money advice
It's been a few weeks since tax day, and that means my time is short. In a very little while my knowledge of and attention to my finances will transform back into a pumpkin, returning to its default state: quarterly comparisons of my checking balance and bar tabs to determine whether I should be drinking less, more, or much more (there are some discontinuities in the function).
I really, really hate dealing with money. It stresses me out, leaving me irritable and petty. Online bill payments have made my life significantly better, so much so that I've completely surrendered myself to them. For a while I insisted on manually responding to electronic bills. Then I automated known outgoing payments like rent. Then I set things up to automatically pay incoming bills. These days I'm perfectly happy to hand my SSN and a cheek swab over to even the shadiest vendor's auto-payment system. So what if they route payments through a Nigerian goldenpalace.com subsidiary with an expired SSL certificate? I don't care. I just want to be left alone until someone tells me I'm supposed to appear in court.
But like I said, I'm still in the midst of one of my financial waking periods, and I should probably seize the moment. I know it's uncouth to complain about not knowing what to do alllll one's vast estates and holdings. But, like a musician who can't help recording a sophomore album about how there's a downside to fame (man), I can't resist. The fact is that once, a long time ago, I was capable of saving money. For a while, I did so. The result was not a princely sum by any means, but enough that I should probably figure out something to do with it: partly because I may someday have expenses beyond electronics, beer and rent; but mostly because I'm tired of Bank of America employees stifling laughs and avoiding eye contact whenever I walk by one of their branches.
The obvious answer is to invest it somewhere. But where? And how? It's tempting to fritter it all away on hand-picked stocks, but a long-gone intern's incessant prattling about his portfolio convinced me that E*Trade's potential for turning me into an insufferable ass makes it an undesirable investment vehicle.
Besides, I remember the lesson taught to me by my ECON101 instructor (author of economic mystery novel The Fatal Equilibrium — yes, really): no matter what you think you know, the market already knows it and has priced itself to reflect it. Got a hunch? The market's on to you. Heard a hot tip? The market did, too. Did you just invent a cheap & effective robot bride at a secret facility buried deep within the earth's crust? Sorry weirdo, the market was hiding in the ductwork and has already radioed the news back to the trading floor. Even if you caught it, it'd just crush the cyanide-filled false molar implanted in its jaw before you could get any information from it.
So the thing to do, apparently, is to find an index fund, which lets you spread your investment across the top 500 or 1000 stocks in various segments of the market. This strategy gets around the problem of your not being very good at picking stocks AND the problem of professional stock-pickers not being very good at picking stocks.
All I really have to do is find somebody who's willing to sell me one of these things, then pick one. Figuring out which business to hire has proven unusually difficult, however. My tried & true method for this sort of thing is to find the firm with the best cartoon mascot. For example, if I was still in the market for car insurance I'd obviously have to give my business to the creators of sexy cartoon minx Erin, who periodically fights robotic menaces with an unnamed animated lummox (can't you see he's all wrong for you, Erin!?).
But things aren't as clear-cut in the financial arena. The closest thing to a cartoon that I can think of are these Charles Schwab commercials that rip off Waking Life:
Counteraguments aside, I decided to give it a shot. But it's hopelessly confusing. There are tons of funds. And although they're rated with a varying number of stars along just a few axes (in order to assist stupid people like myself), the overall risk/reward relationship doesn't appear to be zero-sum. This leaves me wondering why anyone wouldn't just pick the one with the best combination of stars — and why it's so hard to use the interface to find that one (maybe this is why investment bankers are so well-paid). Until I figure out the answers to these questions I'm too terrified to do anything.






















































