Betterment Review: Everything You Need to Know About How Betterment Makes Investing Easy

Betterment review: everything you need to know about how betterment makes investing easy

Betterment Review: Everything You Need to Know About How Betterment Makes Investing Easy


Today let’s talk about investing. Specifically, we are going to talk about the super easy to use Betterment application. This Betterment review will show you just how easy it is to start investing.

I jumped on the Betterment bandwagon a couple years ago because I do not have that much time to research the stock market.

This is why Betterment is the best and easiest way to invest for anyone who does not have the time or knowledge to research the stock market. The financial experts (more to come later) over at Betterment take all of the hard work out of the equation for you.

For me, I personally look at Betterment as a glorified savings account for a variety of different financial goals.

These goals could include saving up for a vacation, an emergency fund, or a house remodeling project.

The money I have put away here was used for our mortgage down payment and saving up for a vacation to Maine this past summer. We still keep an emergency fund and vacation fund within Betterment.

To be upfront with you for this Betterment review, I am showing you screenshots of our Vacation account which currently has zero dollars in it. This is the account that we put money away into to save for vacations. Since we were so aggressive at paying off our car, learn how we did it here. We have actually just restarted our savings for a vacation this month.

Who is Betterment

Alright, let’s start this Betterment review by taking a look at who Betterment really is.

Based in New York City, Betterment was created by Jon Stein in 2008 who wanted to improve the way we invest, “by combining proven investment strategies with technology that drives down costs.” The way the company earns money (more detail later) keeps them from being, “incentivized to recommend certain funds, and we don’t have our own investment products to sell.” This means they will look out for what is really yours. (Betterment)

Betterment review: everything you need to know about how betterment makes investing easy

Overall the company is said to manage $10 billion in assets! That is pretty impressive for a company that is just reaching their 10 year anniversary.

Betterment offers many services such as financial planning, retirement, trusts, access to financial experts, and so much more. Really you can get all of your financial needs satisfied here.

Using their technology, Betterment claims that you will “earn 2.66% more per year than a typical investor.” (Betterment). Whether this claim is true or not, I do not know. It is very enticing though!

Why I like Betterment

Here are the main reasons as to why I choose to use Betterment instead of other services.

Interface: It does not get much easier than using the mobile Betterment application. Here I can see how my accounts (will talk about these next) are performing, easily add more money to those accounts, or adjust how aggressive those accounts are. The clean interface will also quickly tell you if you are on track with that particular account’s goals or not.

Basically, it is a way for the application to kindly yell at you that you are slacking financially.

They also have a very clean online interface (you will see examples later) as well. For me, I mostly use the mobile application because it does everything I need on the fly.

I wanted to have examples in our Betterment review of the mobile application but because of their security policy, the application denies the screenshot request.

Customizable: While talking about how clean the interface is, I kept mentioning accounts. You are asking yourself what the heck those are! Within your Betterment, you can have multiple accounts. These accounts are different investing goals you might have. You might have an account with different goals such as retirement, house down payment, or even that new car.

With each account, you can customize the portfolio’s allocation by adjusting the ratio of bonds vs stocks.

I love this because some accounts you will want to have more aggressive portfolios compared to others. I made our house down payment account more conservative by setting it to invest in more bonds. While I made our vacation fund more aggressive by setting it to invest in more stocks.

Dividends: Another cool feature that I liked was that Betterment takes the dividends your stocks earn and reinvests them automatically for you. I know Andrew loves this idea based on his love for dividend stocks.

It is always fun to receive the notifications from Betterment saying that I earned a dividend and they are putting them to work for me.

When Wouldn’t I use Betterment

Now it is time to change gears in this Betterment review to see when I would not want to use the service. These points are not to negatively reflect on the service but rather to show if you should be using the Robinhood application instead.

Control: Wanting more control as to what stocks your money goes into instead? Then Betterment is not the service for you. Betterment limits your control on purpose as they want to simplify the investing process as much as possible. Plus, as I mentioned earlier, their technology that makes the proper recommendations are said to make 2.66% more per year, so Betterment is wanting you to use their technology.

Robinhood would be a better option for you if you want to put in the research to pick each individual stock yourself.

Time: If you have more time and passion to research your stocks then I would probably use Robinhood instead. Personally, I love to research companies and their stocks. This was a passion that started back when I was around 15 years old.

Between a one-year-old, Wallet Squirrel, and other passions I just do not have the time to do the research.

This is why I decided to go with Betterment. Andrew is a bachelor so he has the time to put in the research. This is why he uses Robinhood.

Cost: Betterment does cost you some money. They base their fee on your overall account balance. There is a 0.25% annual fee for the basic service which will cost you $25 a year if you have $10,000 in your account. Betterment also offers a Premium service that is 0.40% annually which would cost you $400 a year if you have $100,000 in your account (Their minimum balance for the Premium service).

The Premium service sounds pretty awesome as you get unlimited access to a personally picked CFP professional.

To put this into perspective, let’s take a general look at what a CFP can cost.  Some CFP professionals will charge based on an annual fee like Betterment while others change by the hour. Since this is a Betterment review looks compare that way. A CFP professional can charge anywhere between 2% to 0.50% annually depending on how large your portfolio is. Based on these numbers, you can see that Betterment is a cheaper option.

How To Get Started

Head over to Betterment (yes, that is an affiliate link) to get started by clicking the Get Started link in the top right-hand corner. They will walk you through a series of questions to make sure you get the account set up right.

Betterment review: everything you need to know about how betterment makes investing easy

Once you complete the initial set up, you can set up the bank account to make deposits into your new Betterment account. This is located in your account settings in the Bank Accounts sections.

Now it is time to set up an account by clicking the Add Account button on your summary page.

Betterment review: everything you need to know about how betterment makes investing easy

Betterment will walk you through the setup process until they get to my favorite part, the portfolio strategy for this account. Click the Continue button one more time. Here is where you can customize the allocation by adjusting the slider. After you are satisfied with the allocation, Betterment will help you get started on the first deposit to keep you on track with the goal set up.

Betterment review: everything you need to know about how betterment makes investing easy

That’s it! You have set up your first account with a goal to keep you on financially on track!

Want to change up this new account you set up? Do not worry! You can do this by clicking the three dots next to the accounts balance. Then click on Edit Goal and Betterment will walk you through the whole process. Within this menu, you can also edit your allocation or even delete the account once you do not need it anymore.

Betterment review: everything you need to know about how betterment makes investing easy

Well, that is it to get you started within Betterment. There are other options for you to explore such as the Smart Deposit feature or even upgrading your plan to take advantage of their financial experts.

Betterment review: everything you need to know about how betterment makes investing easy


To conclude this Betterment review, overall, I love Betterment as a more robust savings account. Right now I do not use it for anything else.

If you are looking for a new investing service, I would highly recommend trying out Betterment. If you use this link to signup for your own Betterment account you will get 90 days managed free! I only get 30 days managed free if you use that link.

Looks like you win!

When I first started using Betterment, I would not have even thought about using this service for a retirement fund. Since 2015 they have really expanded their abilities and now I would consider it. One day, I actually might end up using it for our 401k as well. Until then, we will just keep putting money away here for our vacations and emergency fund.

What do you currently use for your investing needs?

Happy Holidays from Wallet Squirrel – A Look Back at 2017

Happy Holidays from Wallet Squirrel – A Look Back at 2017

Fun fact. Did you know there are a total of 29 holidays celebrated between Thanksgiving and New Years Eve?

So on that note, we at Wallet Squirrel, would like to wish you a Merry Christmas, Happy Hannuka, or any other holiday you might be celebrating!

Andrew and I personally would like to thank every single one of you for an awesome 2017!

Because of you, in 2017 we saw a tremendous amount of growth of interest in our journey to becoming financial guru’s, investing ninjas, and financially free. You all have decided to join us on this journey as we all learn together from our personal experiences.

Today, I would like to take a look back at our more popular and well-liked posts of 2017. Let the reminiscing commence!

Side Hustling

We, like everyone else, love to find new ways to earn more money and to see how others are making money. This is why we started searching around the globe for new awesome ways to earn more money outside of our 9 to 5 jobs.

How Andrew made $1.88 Selling Stock Photography in 10 Days – Both Andrew and I wrote several articles about stock photography throughout the year. His about how he made $1.88 within 10 Days of being accepted performed the best. I still own the title for making the most money off of one photograph though, $1,000 and counting.

Earn Money While Working Out With the Achievement App – Achievement is a fun application that syncs up with all of your activities, including your tweets. You earn more points the more you walk, workout, sleep, tweet healthy thoughts, and so on. Let the point earning begin!

How to Sell Something on Craigslist and Make Money – Andrew was able to sell some old stuff on Craigslist. He walks us through the whole process from posting his items to meeting up with the buyer. Pretty cool!

I believe he sold his old guitar. Now that he has a girlfriend, I guess he doesn’t need to walk the streets of Denver serenading women anymore.


3 Reasons Why Monthly Dividends are Better – Andrew talks about why he believes that monthly dividends are better than other dividend stocks. He walks you through why you should think they are awesome too and how to find those stocks that hand out monthly dividends.

Come learn how you can learn extra money on top of the normal gains of investing.

Cost-Benefit Analysis Example to either Pay Off My Car or Invest? – Andrew was not sure if he should pay off his car or invest the extra money he had. Enter the cost-benefit analysis. He walks through his thought process and how to properly perform a cost-benefit analysis. Check out the article to

see what he ended up doing.

Latest Stock Purchases – Andrew informs us throughout the year about the latest stock purchases he makes. This is intended to help inform us all about new stocks that might interest you. This is one example of those articles.

You can look at his entire portfolio in the investments page.

Personal Finance

How to Pay Off Your Car Loan Faster – Paying off our car early freed up $405 a month! This money has been great so we can be more aggressive at paying off our student loans. This article walks through the different ways we were able to apply to pay off $7,000 in only three months.

How and What to Teach Your Kids About Money – A lot of us have young kids. One question I had was, “How should we go about teaching them about money?” So I did some research and this is what I found out.

9 Bad Spending Habits that are Killing Your Budget – We all have bad spending habits that we need to drop ASAP. For me, I had a lot! Luckily, I have a loving and patient wife that has helped me break most of these bad spending habits.

What are your bad spending habits?


How to Start a Blog – I could not believe blogging was still so hot! I thought I was caught in an episode of How I Met Your Mother where Barney was only focused on his own blog. Well, the blogging world is still massive and still hot! It is time for you to start your very own blog!

50 Amazon Affiliate Website Examples – The money that can be made off of affiliate marketing is amazing! This article provides 50 examples to get the ideas flowing in your mind.

Are you planning on starting an affiliate niche website in 2018? Andrew is doing one!

An SEO Strategy – What Works and What Does Not – We saw a 1,500% in traffic growth during 2017. This growth mainly comes from our SEO strategy (also our Marketing Strategy). This is the perfect next step after you start your very own blog!

A New Year

I love the end of a year as it is a great time to look back on the goals you succeeded at and failed. This is the time of the year to prepare how you will concur the upcoming year.

For me personally, I do not succeed at every goal on my list. I am alright with that as long as I learn from my mistakes to make the next year the best year yet!

Next week I will dive more into this concept.




Disney’s New Streaming Service Will Soon Destroy the Competition

Disney’s New Streaming Service Will Soon Destroy the Competition

We talk about the rise of Netflix, Amazon’s streaming service, Hulu and even YouTube but I don’t think we’ve discussed enough of the impact Disney’s new streaming service is going to have.

Yes, Disney is Developing its Own Streaming Service

If you didn’t know, Disney is developing its own streaming service that’s looking to be priced substantially below Netflix at its launch. They have been leaking bits and pieces about their new streaming service here and there so we only know a little, but I don’t think people realize how big of news this is.

Cable TV is Dying, Streaming is the New Thing

In 2015, Netflix and Hulu grew 29% to a $5.1 billion market cap while cable and satellite tv only grew by 3%. It’s safe to say that streaming is taking over. Netflix alone has 109.3 million subscribers and anticipates another 6.3 million subscriptions this quarter. Those 109.3 million people are paying $10.99/month. That’s $1,202,300,000 per month. Not bad.

With Streaming, Content is King

Netflix realized a while ago, that anyone can get copy rights to movies and tv shows to be a streaming service, but what makes you unique is the original content you produce. That’s content you exclusively control. Think “House of Cards” you can’t get that anywhere except Netflix. Those original shows draw crowds of people to Netflix and they stay for the wide range of shows to watch. So much so that most people don’t need cable anymore other than sports, which have started streaming as well.

If you’re curious to know how serious original content is Netflix. Netflix plans to spend $8 billion on original content in 2018.

No One Has More Content Than Disney

Nearly every childhood movie (Lion King, Aladdin, 101 Dalmatians, etc.) is owned by Disney. Now add onto those the Pixar movies (Toy Story, Finding Nemo, Cars), Marvel Studios (Iron Man, Captain America, Thor, Avengers, etc.) as well as Lucas Films (Star Wars). These are just a taste of the original content has, and can start streaming on their own network when ready. They own the exclusive rights to these films that can be leveraged in their new streaming service.

These are huge name franchises here! The Marvel Films alone have averaged $840 million at the global box office per movie.

Then you also need to consider all the Disney channel content and shows that it’s created for tv, soon going to be available in one location. I wouldn’t be surprised to see the Disney Streaming service being the one streaming service owned by every mom in America.

Here’s a taste of the Disney Vault of movies.

Now start to consider what if Disney started to produce new content, including Star Wars, Marvel and/or movies exclusively for their new streaming service. That will be a huge draw to the service!

As much as Netflix, Hulu, Amazon Video and YouTube can crank out content. Disney has a winning formula it’s used for years to amass loads of quality content and proven itself over and over. It WILL win the original content game. If Disney can continue to dominate the original content game, they will win the streaming game.

When Does Disney’s Streaming Service Start?

The only thing we know is that Disney plans to debut their streaming service in 2019. Coincidently, this is when their current contract with Netflix is through. So when Netflix loses all their Disney content (think Marvel Series like Jessica Jones, Luke Cage, Daredevil, etc plus other Disney content), Disney will likely publish these shows on their own streaming service.

Keep in mind, they’ll start their ESPN streaming service in 2018 to start catching those cable-cutters who love sports. This will give them an opportunity to help hash out all the bugs for their larger digital content streaming service.

Will This Impact the Streaming Industry?

To give you an idea of the impact the news about a Disney streaming service. When Disney made the announcement, Netflix stock price dropped 4%.

Plus Disney has the resources not only from its box office hits, but it’s depths of resources to undercut all these other streaming services in price. So while Netfilx will continue to raise it’s monthly subscription price to pay for their original content, Disney win the war on prices and simply choke Netflix out. We’ll likely see Amazon Video and Disney as the lasting champions in the streaming game.


I am going to try to pick up a few more shares of Disney while the price is low before 2019. It’s not the greatest dividend for my dividend strategy at a 1.51% dividend, but it’s a great company with a great plan to be the #1 player in streaming services.

If you liked this article, I’d love if you shared it! =)

AndrewWallet Squirrel Found and Finance Ninja

Top 22 Warren Buffett Quotes the Internet Can’t Get Enough Of

Warren Buffett, CEO of Berkshire Hathaway, has a net worth of over $78.2 billion and is known as one of the greatest investors of all time. So when he speaks, people take notes. Here are some of the top 22 Warren Buffett Quotes the internet can’t get enough of.

Warren Buffett Quotes Infographic

Top 22 Warren Buffett Quotes the Internet Can’t Get Enough Of

Here are some of the top Warren Buffet quotes found on every list of Warren Buffet quotes around the internet. These quotes range in wisdom on investing to regular life. I try to live by these quotes on my own investment portfolio.

Warren Buffett Quotes

1. Rule #1: Never lose money. Rule #2: Never forget rule #1

One of my favorite Warren Buffet Quotes. The fastest way to grow your money is to never lose it in the first place. This applies from saving on your groceries to focusing on less risky stocks of well established companies.

2. It takes 20 years to build a reputation and five minutes to ruin it. If you think about that, you’ll do things differently

Think about the Wells Fargo or Equifax scandals. It takes years to build enough trust for someone to have brand loyalty. Warren Buffet quotes it takes 20 years, but it takes 5 minutes or less to destroy all that goodwill you’ve built. People are quick to revolt if you’ve done anything to betray their trust.

It is infinitely harder to build trust than destroy it.

3. Diversification is a protection against ignorance. It makes very little sense for those who know what they’re doing.

Multiple studies show that diversification in the stock market will help protect you against market falls. Or it could be summarized in the old proverb “Don’t put all your eggs in one basket”. Unless you have insider information that a stock is going do really well, maintain a diversified portfolio to protect you. No one knows what they’re doing all the time.

4. If you aren’t willing to own a stock for ten years, don’t even think about owning it for ten minutes. Put together a portfolio of companies whose aggregate earnings march upward over the years, and so also will the portfolio’s market value.

Unless you’re a day trader (I will never be), you should only be investing in the stock market with the intention to hold those stocks for a long time. You can do really well as a beginner if you’re buying stocks and not planning on selling till you retire. Those are where you get the best returns. Warren Buffett is infamously known for rarely selling stocks.

5. It’s far better to buy a wonderful company at a fair price than a fair company at a wonderful price.

When you buy a stock, you should think of it as owning a piece of that company. You should be looking at wonderful companies that have a competitive advantage in the industry. Those are the companies that will do well over the long run. You may find a wonderful price on a mediocre company, but really what are you getting? A mediocre company that will likely be edged out of the market by a better company.

Many of the famous Warren Buffett quotes are about investing in strong companies with a competitive advantage and strong brand loyalty rather than cheap companies where you think you can make a quick buck. Warren Buffett is never into buying a company for a quick buck.

6. Be fearful when others are greedy. Be greedy when others are fearful.

During the 2008 financial crisis when investors were all exiting the market, Warren Buffett invested in a few large companies even though their stock prices were falling. Those deals made Warren Buffett over $10 billion dollars when the market stabilized and it’s continuing to show dividends. When the market goes upside down during world events, politics, market forecasts, those are the times when everyone else is fearful, that Warren Buffet sees an advantage when the markets crash.

Think about it this way, the New York Stock Exchange has been around since 1817, it has always recovered. Chances are, minus a world apocalypse, that the market will always bounce back. Those who capitalize on those downturns are usually rewarded.

7. The difference between successful people and really successful people is that really successful people say no to almost everything.

One of my favorite Warren Buffett quotes because it has so many applications. You will see many opportunities in your life and you may want to jump on everyone, but it’s ok to be selective and say no. You’ll burn yourself out if you say “yes” to everything. This also applies to going out on a Saturday night with friends drinking. It’s ok to say “no” to save a few dollars or have a night to yourself to finish your article on Warren Buffett quotes. =)

This also applies to going out on a Saturday night with friends drinking. It’s ok to say “no” to save a few dollars or have a night to yourself to finish your article on Warren Buffett quotes. =)

8. Develop and build the habits you admire in others.

Remember all those times that your parents wanted you to hang out with those “good kids”. The habits of the people you surround yourself with rub off you on, consciously or unconsciously. When you find people like Warren Buffett, the Oracle of Omaha, who is one of the greatest investors of all time. You should find out what makes him so successful and learn those traits to improve yourself.

9. Passive investing will make you more money than active trading

Oh my goodness, fees are the WORST! Active trading requires more work and more fees, so more of your money will be paid to your broker. Yet studies have shown over and over that passive investing where you set your money and forget it are far more successful for growing wealth. I don’t plan to ever touch my stocks currently making dividends.

10. There seems to be some perverse human characteristic that likes to make easy things difficult.

Great quote, people always imagine things are more difficult than they really are. When I first considered starting investing, I thought there were so many hurdles and financial experts I would have to pay. Yet, when I finally decided I wanted to start investing in the stock market, I just downloaded the Robinhood App and started investing. It took 10 minutes to sign up and buy my first stock when I worried about investing in the stock market for over 5 years. Things are often more simple than you think they are.

11. Tell me who your heroes are and I’ll tell you who you’ll turn out to be.

This is similar to the Warren Buffett quote “Develop and build the habits you admire in others”. If you want to be an entrepreneur, start joining local meetups of entrepreneurs. You learn SO MUCH MORE when you surround yourself with the people you want to be like. You can learn A LOT in a book, but you’ll learn even more by surrounding yourself with people you admire.

12. We have long felt that the only value of stock forecasters is to make fortune-tellers look good.

No one can predict the stock market, no one. Not even Warren Buffett. Anyone who says they know exactly how the market works is trying to sell you something. You can lump stock forecasters being as accurate as the carnival fortune-tellers. You know the ones with 3 teeth, crystal ball and you’re going to die in 2083.

13. When we own portions of outstanding businesses with outstanding managements, our favorite holding period is forever.

If you invest in an outstanding company, even if the stock price goes up, why would you ever sell it? No matter when you sell it, outstanding companies will continually do better and better. Don’t sell until you absolutely have to, otherwise, you’ll just be losing money in the long run. Many of Warren Buffett Quotes are like this, they are all very Anti-Day Trader.

14. You don’t need to be a rocket scientist. Investing is not a game where the guy with the 160 IQ beats the guy with 130 IQ.

If you follow the basic principals of Warren Buffett and buy outstanding companies with strong competitive advantages like Apple (AAPL). You don’t have to be a genius. Just buy and hold forever, you literally don’t have to do anything until you sell.

Many Warren Buffett quotes are similar to this because he stresses that anyone can invest in the stock market. The simplest way is just to invest in index funds that follow the market. Set it and forget it. The market sees an average increase of 7% per year and that’s WAY better than a savings account.

15. I try to buy stock in businesses that are so wonderful that an idiot can run them. Because sooner or later, one will.

Look for companies to invest in that are so strong that they can weather any storm because soon enough they will have to. Think about Apple (AAPL), as long as they keep pushing out iPhones it doesn’t matter who runs the company, they’ll continue to do well. People were worried when Steve Jobs passed because they didn’t know the future of the company, but Tim Cook stepped in and maintained the same Apple legacy. As long as Tim Cook sticks to the secret Apple recipe, they’ll be in good shape.

16. Buy into a company because you want to own it, not because you want the stock to go up.

If you see a company that you think is going to do well or heard will do well, don’t buy it unless you’re willing to hold it for awhile. If something goes wrong and the stock dives, you’re stuck with a company you don’t believe in and will likely sell at a lower price to get rid of it, ruining the reason you bought it in the first place.

17. Wall Street is the only place that people ride to work in a Rolls Royce to get advice from those who take the subway.

This is just a funny Warren Buffet quote.

18. Charlie and I have not learned how to solve difficult business problems. What we have learned is to avoid them.

I’m sure Warren Buffett and Charlie Munger have learned how to solve difficult business problems, but the best way to navigate murky waters is to avoid them all together. The more problems your business can avoid, the better shape you’ll be. You can avoid a lot of problems from being proactive instead of reactive.

19. Long ago, Ben Graham taught me that “Price is what you pay; value is what you get.”

Ben Graham, Warren Buffett’s mentor had this popular quote. I always think about it simply. Price is what you buy a stock for and Value is what you sell that same stock for.

20. It’s better to hang out with people better than you. Pick out associates whose behavior is better than yours and you’ll drift in that direction.

If you can’t tell, Warren Buffett believes in surrounding yourself with the right people. He credits much of his success from surrounding himself with smart, good people.

21. If past history was all there was to the game, the richest people would be librarians.

When you analyze a stock based on its historical performance, it’s called technical analysis. Yet past performance does not necessarily mean future performance. Just because you know what the stock has done in the past doesn’t mean it’s going to follow that same trend.

22. You only have to do a very few things right in your life so long as you don’t do too many things wrong.

It’s ok to mess up, focus on learning from those mistakes for the next time. It just sounds cooler when Warren Buffett quotes it. Or you can take this as no matter how many mistakes you’ve made in the past, you always have a chance to do more good. It’s one of those life quotes that can go many ways.

Latest Stock Purchase & Analysis – Cisco (CSCO)

After seeing multiple investor friends pick up Cisco (CSCO) lately, I had to check it out. So these are the insights I looked into and ultimately factored into my first purchase of Cisco.

Why am I sharing my latest stock purchase?

Each month I try different ways to make extra money and share how much I make in my Income Reports. Every month I use this money to buy more stocks and other investments to build a $10,000,000 investment portfolio. It may take a while, but it’s done with one investment at a time.

This month I bought 9 shares of Cisco.

What is Cisco

Cisco (Stock Ticker CSCO) is a hardware and software company that designs, manufactures, and sells Internet Protocol (IP) based networking and other products related to the communications and information technology industry worldwide.

I basically just like to think of Cisco as the infrastructure of the internet. All of the highways that connect websites and databases and funny cat videos of the internet are primary run on Cisco products.

If you want to know what a company does look at their revenue. In 2016 this is where their money came from:

  • Switching (30% of revenue) – Switches connect computers, printers, and servers within a building or campus. These allow everything to talk to each other. Switches create a network of devices.
  • Routers (15% of revenue) – If a switch is a network, routers connect networks. A router links computers to the internet.
  • Collaboration (9% of revenue) – This is a general term to describe their immersive video conference software, IP telephones, software to connect the devices to talk to each other. This includes Jabber, Cisco WebEx and Spark. For example, my office uses Cisco WebEx to coordinate all of our in/out video conferences.
  • Data Centers (7% of revenue) – Data Centers allow large scale flexible computing. This can be from storage to computing power.
  • Wireless Infrastructure (5% of revenue) – These are the base stations and infrastructure for Wi-Fi. Think of hotels, casinos, grocery stores, airports and any building that provides Wi-Fi. Most of these devices are Cisco related.
  • Security (4% of revenue) – These are the firewalls that block out Russian hackers and malware from accessing their infrastructure and their client’s servers/computers/Internet of Things.
  • Services (24% of revenue) – These are the people that run these services, train clients how to use them, manage networks, operate systems and support their wide variety of products.

We can say that the other 6% is “Other”, but you get the idea they do a lot with the internet. Combined all these products and services generated $49,247,000,000 in total revenue in 2016.

Why did I buy Cisco?

When looking over Cisco, they really hit some of the key factors that I look for when buying a stock.

1. Dividend (good)- They have a 3.69% dividend that they’ve had since 2012. That 3.69% is really nice considering this is a tech stock that traditionally has lower dividends.

2. Historical Performance (good)- They say that past performance doesn’t indicate future performance, but I like the graph of the stock price over the last 5 years. It has its dips, but overall it has a progressive climb. That is a plus for me.

5 Year Graph of Cisco’s Stock Price

3. Strong History (good) – I’m not a big fan of crazy risk, so I like to invest in proven companies. Cisco has a market cap of 161.702 Billion, they’ve been around since 1984 building the internet. I want to make sure that the company has been tested long enough that they know how to manage market downturns.

4. Reoccurring Revenue (getting there) – Cisco has traditionally been a hardware company, but they are transitioning into more of a software company and one that wants to focus on a subscription model. Their CEO, Chuck Robbins even mentioned in their 2016 Annual Report that they are “working to move more of our revenue to a software-based and subscription-based model”. I am a huge fan of reoccuring revenue, so when I see a company of this size transitioning to that business model, I can get on board.

Since I liked what I saw, I bought 9 shares at $31.89 per share for a total of $279.09.

Why did I buy now?

In honesty, I probably rushed into buying Cisco because I wanted to buy their stock before their earnings call on August 16th (yesterday). I thought the stock would increase after the earning call, but it dropped a bit after coming short on revenue. F*&K.

The stock price has dipped about a dollar since then. I failed.

I will continue to hold Cisco because I think they are in the right direction, but it just sucks that I bought it right before the dip. This will probably teach me not to rush into anything when looking at future stocks.


I like Cisco and look forward to following them, but will be hesitant into rushing into any future buying just because a earnings report is coming up and everyone else is bullish on a stock.

If Cisco continues to invest more into their subscription-based business model, I’ll likely add more to this position.

3 Reasons Why Monthly Dividend Stocks Are Better than Quarterly

When I recently sold $6,000 of my portfolio, I kept 2 stocks. These were Verizon (VZ) and Realty Income (O).

I choose to keep Verizon because they were in the process of picking up Yahoo and the stock was tanking because there were strikes and other internal issues with Verizon’s business. However while the stock went down a few dollars, I’m confident they are coming back.

The other stocks Realty Income, has always been one of my favorites for several reasons. First they are a REIT (Real Estate Investment Trust) and they own the land under businesses that aren’t getting disrupted by Amazon yet, like Dollar General, Walgreens and CVS. SECOND, is they are known as the “Monthly Dividend Company” because they produce monthly dividends.

There are a lot of companies that produce dividends (why I love them), but receiving dividends monthly is pretty awesome!

Why Monthly Dividends Stocks are Awesome!

  1. Monthly Dividend Stocks are way easier to budget for – If you’re waiting quarterly for those dividend checks, you’re forced to budget that income for the next several months. A lump sum you have to let sit in your bank account tempting you to spend it. No matter your willpower, you’ll always be thinking “I’d be willing to eat Ramen Noodles for the next month if I bought a boat right now”. You’ll be the most sodium rich sea captain. You’re better than that.
  2. Better Compound Interest – If you’re receiving dividends every month, you can use that to reinvest in more stocks and have those dividends grow more by the time your other quarterly stocks arrive. Simply, the faster you reinvest those dividends, the faster they’ll compound interest. For Example, if you owned 1000 shares of a $10 stock at a 5% annual dividend. At the end of the year you’ll have earned 5% at $500. However if you received monthly dividends, you could reinvest those dividends each month and have earned 5.12% at $511.62. This is assuming you have a DRIP campaign set up. However it’s obviously more, and that’s only one year.
  3. It’s enjoyable seeing regular income – There is something incredibly satisfying as an investor seeing their investments create monthly income. It feels like you’re earning extra as your stock price fluctuates, you’re still seeing income being produced. You can reinvest or spend that monthly income but it gives you extra cash each month to play with.

What Type of Companies Produce Monthly Dividends?

You’ll mostly find monthly dividend companies limited to Real Estate Investment Trust, Business Development Companies and sometimes Master Limited Partnerships.

Real Estate Investment Trust – is essentially a company that owns multiple properties and generates income based on those properties. They can specialize in different real estate niches such as commercial property, apartments, office buildings, hospitals, etc. Each REIT usually has a specific focus and most produce dividends.

Business Development Companies – are organizations that invest in small to medium-sized companies to help them grow in pivotal stages of their development. Their income is made up from their investments in companies.

Master Limited Partnerships – are organizations that generate predictable income streams based on production/processing/storage and transportation of depletable natural resources.

Are you invested in any monthly dividend stocks? Tell me about them.

Income Report – August, 2016

As I start ramping Wallet Squirrel back up, I’m reminded that no matter what I do. There are some passive income strategies that keep earning me money. So dear passive income. Thank you.


Let’s talk Double Cash Back Credit Card

During a recent Entrepreneur Meet and Greet in Denver (yes, I go to these). It was pointed by a fellow entrepreneur who read my blog (eek, people read this) that we should clarify good and bad ways to use a credit card.

See, I pay off my entire credit card debt daily, since I paid mine off in 2015. So I treat my credit card like cash. I know that I am going to HAVE to pay it all off the next day so anything that I’m willing to pay cash for, I use credit. Mainly just for the 2% cash back.

It was pointed out though, that some people may not know this difference and could continue their spiral of debt. I’m obviously not condoning this. Only use a credit card if you have good credit card habits. It’s easy to say you’re getting 2% back with a credit card, but things still cost 98%.

Moral of the story. It’s hard to say my 2% Cash Back Credit Card is a sort of passive income. Especially if I’m using it to buy wants like Colorado Rockies Tickets. However, a majority of the time I use my Cash Back Credit Card on purchases I’m going to make anyways, so I consider it passive income.

Monthly Goals (I HATE monthly goals)

I have a bad habit of not liking being told what to do. Once I write something down, I’m telling myself to do something and sometimes that’s a bit much. Especially when the guilt of failing a to-do list is a lot worse than actually accomplishing something. Maybe I’ll rename this “Some things Andrew, could maybe do in the future, if he wants”. Catchy right?

  1. Write 2 posts this month on how to earn additional income. That’s what this site is about and let’s get down to the roots.
  2. Comment on 70 blogs. I came to this number because I have 70 blogs on my “To Read” list. Let me know if you want to be on this list.

What are Dividends and Dividend Investing?

On Friday, I sat at lunch with some friends talking about life, weekend plans, and personal finance. I’m a dork I know, but I found myself explaining what are dividends and dividend investing. So let me take a shot at this since I talk about them ALL the time.

What are Dividends?

Let’s start with what are dividends. Dividends are a portion of a company’s profits that are paid regularly to the company’s shareholders. The amount of profits shared among shareholders is a percentage of the stock price called “yield”. This is shared sometimes annually, quarterly or monthly to the shareholders depending on the company.

Dividends are popular because not only do shareholders of a company’s stock see the price move. They receive dividends just for owning the stock. It’s like a small bonus.

For example: Apple (AAPL) stock price is currently $100. Apple has an annual dividend yield of 2.27%. Shareholders will receive $2.27 throughout the year just for holding onto the stock. The neat part is shareholders will receive income from their investment without selling.

What Are Dividends Infographic

Why do stocks produce dividends?

First, not all stocks produce dividends. Stocks like Google and Amazon don’t produce dividends. Every company decides for themselves whether they want to or not.

Stocks like Google and Amazon don’t wish to produce dividends because they want to focus all extra capital for research and development. Typically younger companies like this don’t pay dividends. However if you look at Coca-Cola, while they do innovate, their extra cash is distributed as dividends because they found it’s better put towards dividends to attract more investors. Dividends are very attractive to investors because of compounding.

Let’s Talk Compounding!

The idea is that dividends will compound increasing your investment. Let’s say you invest in 50 shares of stock ABC at $100 a share with a 3% dividend yield, you’ll annually earn $150 per year in dividends. However if the stock increases its dividend 5% (not stock price value, but dividend yield), your $5,000 investment in 20 years will be worth $13,143. That’s a 162.85% gain! Here’s a great dividend reinvestment calculator.

That’s if the stock stayed the same price at $100, but typically the market increases annually at 7%. So both the stock price and dividend will increase. Cool right?

What is Dividend Investing?

Dividend Investing is the idea of investing in only stocks that produce dividends. The purpose being of living off the dividends produced by the stocks you own opposed to selling your stocks for money. It essentially creates passive income.

Let’s say you plan to live roughly till your 92, and you want to have $60,000 per year for retirement. If you retire at 65 you would need to have $1,620,000 (before taxes) saved up to spend $60k every year. Yet, by 92 you will have run out of money, totally broke, dirt poor.

However dividend investors use dividend yield to create passive income for retirement. In the same situation, a dividend investor would save a larger amount upfront, $2,000,000 in a portfolio of dividend stocks at a 3% dividend yield. That 3% yield will create $60,000 (before taxes) per year. If you never touch your principal (that $2,000,000) you’ll be able to keep receiving dividends every year, forever. So even if you live to 126 (oldest person in the world), you can rely on that $60,000 every year since people seem to keep living longer and longer. I personally plan to live to 182.

Dividend Investing is relying on a reoccurring stream of income that never runs out opposed to a stash of cash that will eventually run out. If you haven’t figured it out, I’m a dividend investor.

Fun Fact: All five of Warrant Buffett (one of the greatest investors of all time) largest stock holdings pay dividends. These are Wells Fargo, Coca-Cola, American Express, IBM and Wal-Mart. He lives on the buy and hold strategy. He invests in good companies that pay dividends and sits back and receives a paycheck. Sounds like a dividend investor to me.

I’m constantly wordsmithing on how to explain what are dividends and dividend investing to people. How’d I do? Any tips on explaining it better?

My Emergency Fund, Why I Keep $2,000 For Emergencies

Early last year, following the January 17th post season game of Broncos vs Steelers, I recall reading Dave Ramsey’s “Total Money Makeover”. Yes, I was desperate.

In one of the first chapters, he goes on and on (he literally can not shut up about it) about having an Emergency Fund. Yes, others have mentioned it, but for me, Dave Ramsey was the first to tell me I need to get on this. He was my first.

Here’s the thing with Emergency Funds. Everyone seems to have a different way they set these up. Davvy-Poo Ramsey talks about putting money in an envelope under your bed for safe keeping to pull out in dire emergencies. His believes that if people have an emergency fund easily accessible, they will spend it. Apparently he believes his audience has no self-control, maybe they don’t, but I went a different direction. I will always love Davvy-Poo for starting on my Emergency Fund journey, but here’s where I deviate.

My Emergency Fund

I have everything electronic. I keep $2,000 in my checking account as my “Emergency Fund” where it’s readily available. I don’t have cash hidden under my bed like National Geographic’s Doomsday Preppers (how the mighty National Geographic has fallen).

My active checking account fluctuates between $2,000 and $4,000 each month to cover my monthly expenses. At the end of the month, anything over $4,000 goes toward my savings account and that into my dividend portfolio. Here’s what I mean (infographic below):

Emergency Fund Infographic-01

Why I set up my Emergency Fund like this?

I have a method to my madness. Two reasons why I set up my Emergency Fund like this:

  1. My checking account is immediately accessible for debit withdraw if needed. PLUS my checking account gains interest (albeit a small amount) my emergency fund is large enough I make about $0.20 each month. I couldn’t do that hiding cash under my bed like a caveman.
  2. The biggest reason is fees. Overdraft fees are ridiculous and I’ve done that a couple times when I kept extra cash in savings. Since my Emergency Fund is the base of my checking account, if I go over my monthly expenses, it just pulls cash from my Emergency Fund which is the foundation for my checking account. No OVERDRAFT FEES EVER.

How much do you need in an Emergency Fund?

This is where a lot of people differ on how much they should have saved in an emergency fund. For me, I try to have $2,000 in my immediate emergency fund. This will cover about 1 month’s expenses for me. My emergency fund essentially gives me enough time to access my stock portfolio if needed.

In case of a legit emergency, here’s what I’d actually do

I’ve never had a legit emergency that’s affected my income (I’m young and invincible), but if I ever did, I have a plan.

  1. I would have immediate access to $2,000 in my checking account
  2. I would have immediate access to my emergency fund of $2,000 also in my checking account
  3. I would have semi-immediate access to my saving account which usually holds $4,000. It’s a semi-secondary emergency fund. This also makes interest =)
  4. That would give me time if needed to sell stocks and access my portfolio currently made up of $7,000.

With my average monthly expense of 2,000. My emergency process would cover me for 7.5 months if I could make no money what so ever. That’s pretty cool! Yes, I have friends and family that would be willing to help, but it’s important to me that I could support myself.

How do you set up your emergency fund?

Robinhood App Review: I saved $420 in trading fees in 6 months

Robinhood App Review: I saved $420 in trading fees in 6 months


Summary: In short, I have saved $420 in trading fees in 6 months (calculations below). I tested the new Robinhood stock trading platform, since September 2015. This article is a personal summary of the headaches and “fucking awesome” moments that I yelled out loud the past couple months. Let’s face it though, you hate trading fees and you’re curious to see what all the hype is about with the new Robinhood App.

What is Robinhood?

Robinhood’s biggest claim to fame, it has $0 trading fees. I said that right. The average trading fee is $7-$10 per trade and Robinhood said screw that! Traditional brokerages make SO MUCH MONEY, that Robinhood formed a different business model where they don’t make money on their trades (I’ll explain how their make dough in a bit)

You’ll first notice: You’ll always see Robinhood called the “Robinhood App” because it’s not a traditional brokerage with a website, it is purely only an app. This is one way they keep their costs down, but also because their target audience is millennials. Robinhood specifically target new millennial investors usually around the average age of 24. Those who are starting out with little money, who can’t pay trading fees but want to start investing in a simple way.

It’s open to everyone: Everything I read on Robinhood talks about their waiting period. I didn’t encounter that at all. I simply downloaded it on my android phone (originally built for Apple, but works on both) and signed up. They make it easy.


How Robinhood makes money

If you ever want to understand a company, understand the way they make money. Nike and Gap use child labor to make a higher margin. I’m not here to judge, just shining an example why should know the fundamentals of how profits are made. Let’s take a look at Robinhood’s.

Robinhood makes money by:

  • Collecting Interest from the cash you have lying in your brokerage account that isn’t invested. For example, if you have $900 in your account and are waiting for stock prices to come down, traditional brokers are gaining interest off that $900 like a savings account. Some brokerage accounts give some of this back, but Robinhood keeps it. You won’t lose any money, but you just won’t gain anything extra from un-invested cash. So invest it!

Most electronic trading firms pay little to nothing to place trades, but individual investors are getting taxed up to $7 – $10 per trade. Robinhood saw this as an opportunity.

Robinhood App Review: My experience

Signing up: Pretty simple. I downloaded the Robinhood App from the Google Play store on my android phone. You will fill out the same info you would open a bank account. You will have to give your social security number, so be warned, but this is the same info you’d give to any brokerage account. It just feels weird because you’re doing this all over a phone.

Once you register and sign in. You don’t have to use your email and password every time. You can set up a 4 digit pin for security in case you lose your phone.

Connect your bank account: Everything is electronic, so you need to connect your bank account. Both traditional brick & mortar banks, as well as virtual banks, will work. I connected both my Wells Fargo account and Ally account. Keep in mind, when you sign up, you won’t be able to trade right away. There is usually a 5 business day waiting period once you sign up. This is usually just for Robinhood to verify that your money (a few cents) can be sent to your bank and back.

Is it weird doing everything over an app? There is definitely an adjustment period where you need to get comfortable trading over the app. I’ve never traded over anything else, but it turned out quite easy. There are not many buttons and it’s straight forward.

  1. Search for your stock ticker
  2. There is a large buy button, click it
  3. There is a verify screen, where you must swipe up to verify. This removes people who accidentally double tap from making mistakes.
  4. Done.

Here is a look at what the Robinhood App looks like.

Robinhood App Review - Screenshots-01

What I like about the Robinhood App

In the last 6 months, I have done 60 trades. These were a majority of buys and averaged around $101.23 per trade. I prefer dividend investing. So when I have an extra $100, I want to invest that immediately, because the longer it’s invested, the more it’ll make. Traditionally I would keep that $100 in my savings account until I had $1,000 or so to justify a $7 trading fee. Now I just buy stock immediately!

I can do this at my desk at work. I receive a notification from Robinhood that HCP has decreased 10%, I can open up the app and buy 2 shares of HCP faster than I check Facebook (Facebook is addicting). I don’t have to think about the cost/benefit of paying $7 to do this, it’s free! In the total span of 60 trades in 6 months assuming a the minimum fee of $7 I have saved $420 in trading fees. Awesome right?

What I don’t like about the Robinhood App

  1. The biggest issue with Robinhood is the three business day wait period. If you transfer money to your Robinhood brokerage account on Monday, it won’t be available till Thursday. If you sell a stock, you won’t have that cash available to you till 3 business days. Yes it sucks, but I have more time than money. Easily worth $0, but worth sharing. Just wait till Robinhood Instant is revealed to everyone.
    UPDATED 9/22/2017 – There is no more wait period for Robinhood Instant. It’s open to everyone, so no more 3 day wait period for your investments. This is awesome! 
  2. There is no website to access your stocks whatsoever. That means I can’t connect it to Mint (my money manager). Mint as consistently stated that since Robinhood doesn’t have a website, it can’t connect to the brokerage account. So my true financial worth isn’t provided. This does kind of suck.
  3. There is no in depth analytics to analyze stock values. It gives the basic info, but I usually use Yahoo Finance to do my research and just use the Robinhood App for pulling the trigger. With so many great analyzing tools on the web, this isn’t the biggest loss.
  4. I would be remise if I didn’t mention the recent glitch Robinhood had. I woke up earlier this week to find that Robinhood glitched out and didn’t display my portfolio value. I literally freaked the fuck out. My balance went from $6,604.54 to $8.14 (which was my available cash). I immediately noticed that I still had all my stock positions, but it just didn’t total correctly. I knew since it was displaying my available cash instead of the portfolio value, this was a glitch and pulled the wrong info. I rightly, emailed customer support and they fixed the issue in a couple of hours. I don’t think it was too crazy, but some people on the world wide web wouldn’t shut up about it. Maybe it is the $0 free trades, but I can live with a small glitch for saving $420.
    UPDATED 9/22/2017 – This hasn’t happened since.

Don’t let those negative comments scare you, I have absolutely loved the Robinhood trading platform! I plan on continuing to use it as my primary brokerage account for years to come.

The last word

Robinhood isn’t the first to try the $0 free trade. Other companies have done this in the past and frankly failed. It’s a difficult business model, but I think Robinhood is doing it right. They have received financial support from some large names like Google Ventures, Index Ventures and Ribbit Capital. They have something special.

I will continue to use Robinhood as my brokerage account for the foreseeable future. I do small trades and that $0 trading fee is perfect for my investing style. If you are tired of paying for trading fees, I’d suggest you give it a try. Plus their new promotion gives new sign-ups a free share of stock.

I believe the Robinhood Business model will influence other brokerage firms in the future and they’ll lower prices to target this millennial demographic. This will be awesome for future investors. Would you be willing to try it? If not, what are your reservations?