News Archives - Lazy Man and Money

Finimize is your Essential 3 Minute Daily Finance Read

July 11, 2019 by Lazy Man 1 Comment

Today I want to tell you about one of the three free newsletters that I read every day without fail. The other two aren’t money-related, so perhaps I’ll cover them another time. I’ve been a subscriber for more than 2 years. During that time’s it’s become incredibly popular with more than 400,000 subscribers.

You know those clickbait titles that make all sorts of crazy claims? This isn’t one of them. Finimize really is best described as “your essential 3 minute daily finance read.” (Those are my words, but I fully expect them to ~~steal~~ borrow them for their future marketing purposes.)

Did I mention that it’s free? I did? Good. It’s easy to miss that very important word with all the other information I’m putting out there.

When you sign up for Finizmize you’ll likely get an email like this one (though it’s possible the welcome has changed in 2 years):

What do you get when you subscribe?

Every morning, I get a financial email that focuses on just two of the main things that happened in the markets. Sometimes it’s a stock. Sometimes it’s a snapshot of an economic report. It always has a section “Why Should I Care?” that explains in plain language what’s really going on.
This morning one of the focuses was on the odds of a recession. It cited this chart from the NY Federal Reserve. You’ll want to scroll down on that for the really amazing part. The Fed has pretty much nailed all the major recessions… and we’re at the point where it’s looking like the next one is upon us.

I know people have been saying that for years, but it’s “next level” to see an authoritative source present a 60-year historical chart showing that a recession is coming.

How could you use this information? Maybe you could take a more conservative investment approach? Personally, I’m going to be shifting some money into bonds. Another possibility is to sell some stock and hold some cash. I’m not going to suggest what you should do, but give you some ideas of what you could do.

The other thing that I love about Finimize is that it is only a 3-minute time investment. We’re all busy, and even financial nerds like me have to think twice about spending 20 minutes on an in-depth financial read.

I’ll highlight a few more things from Finimize in the upcoming weeks and months, but for now I’ll take their cue and keep it sort and sweet. Sign up with this link or the button below:

Join Finizmize!

Jay Leno ($13 Million Mansion and 180 Cars) Says He’s Frugal

March 27, 2019 by Lazy Man 13 Comments

Jay Leno is my neighbor. He’s not my next-door neighbor, but our small Newport, RI community consists of around 60,000 people. Even though I’ve never met him, I hear he’s an extremely nice guy. That’s why this is a uniquely difficult article to write.

A couple of days ago I was reading Money Magazine and came across the following article:

Jay Leno Money Magazine — (Note: I’m including the article here because the free online version from a year earlier is a little less tone-deaf and contains the same basic information. My fair-use to criticize is dependent on the print version above.)

I haven’t seen a money/celebrity article this bad since the famous Men’s Health/Erin Burnett article of late 2007. A few days after I pointed it out it started to make headline news.

This isn’t as bad as that one was, but it reminded me of it. (Now I wonder if the Kylie Jenner self-made billionaire mess was as bad.)

Let’s start with the subheader, “The comedian enjoys the fastlane – but lives like he’s on his last dime.”

I had trouble reconciling that with this piece of news from about 15 months ago, Jay Leno just bought a $13.5 million oceanfront mansion in Newport, R.I. — take a look inside

Here are some nuggets from the article according to the real estate listing:

A gated entrance and winding drive leads up to the estate, which sits on a 9-acre lot and features 15,851 square feet of living space. The home has 12 bedrooms, 12 full bathrooms and three half-baths, according to the listing. It’s also packed with luxe amenities, including a carriage house, walled garden and tennis court.

(Grrr… no Oxford comma!)

There’s more to the description, but a $13.5 million home tells you all you need to know. Using standard estimates on maintenance of a home of 1% of annual price per year, he’ll spend about $135,000 a year just to keep it as it is. Maybe it’s even more with the extensive landscaping.

Jay Leno’s “last dime” must be Scrooge McDuck lucky one.

Originally, I thought that the online version of May 15, 2018 was before he bought the mansion, but it was after.

The Money Magazine article above also mentions that he has around 350 motor vehicles. That includes one he bought in 1999 for $800,000. That’s over 1.2 million in inflation-adjusted dollars today.

I found only one thing in the article that led me to believe he’s frugal. Leno says he doesn’t spend much on clothes.

Leno does make an attempt to preach good financial habits. He says that he never bought anything before he could afford it, never bought anything on credit, and that cash is king. Unfortunately, these are all things that Paris Hilton could say as soon as she was old enough to talk. While Leno made his fortune himself, it’s doesn’t mean he’s frugal. Those financial habits are very easy to follow… if you have a net worth of $350 million.

The Money Magazine article finished up with a quote of “I live pretty frugally.”

If a $13.5 million home and a $70 million car collection*, is living frugally then, you too, can be frugal!

I’m having a lot of difficulty in trying to stretch that to be frugal… even in celebrity terms. I haven’t seen his car show, but if someone is making a show to show off dozens of millions of dollars of your purchases… you can’t say you “live pretty frugally.”

I’m almost having a lot of trouble trying to figure out what feels worse to me about this. Should it be:

Jay Leno himself – I actually think that Jay Leno might deserve the least blame. He’s just saying things like they are for him and giving a little background in his past.
Jay Leno’s publicist – Shouldn’t his publicist take a look at this and say, “Ummm, Jay, this comes off like an alcoholic claiming he isn’t one because he rarely drinks tequila. Instead he only drinks 2 liters of vodka by noon each day”?
Money Magazine – Shouldn’t an editor at Money Magazine take a look at this and say, “We lose a lot of credibility when we blindly equate spending dozens of millions of dollars with being frugal. Only Larry Ellison** can relate when he reads this. The rest of our audience is going to collectively think WTF“?

I’m also confused about why Money Magazine would recycle this interview from about a year ago now. I wonder if they ran out of production time and quickly edited something old as filler.

I’m going to leave those questions up to you, the reader to answer. Let me know your thoughts in comments.

And if I’ve been a little harsh to Jay Leno here and he’s reading it, hopefully he has a sense of humor ;-). I’m not nearly as bad as John Oliver was a little over a week ago:

* This is estimated by adding the 50 more cars mentioned in this interview to the $50 million mentioned at that link.

** Larry Ellison is one of my other rich “neighbors”.

Let’s Talk About the Self-Made Billionaire Kylie Jenner

March 12, 2019 by Lazy Man 2 Comments

Last week Forbes published what has become its second annual clickbait attempt. It was clearly success and I’m upset with myself for continuing to give them attention, even if it’s negative attention. Trust me though, there’s a good reason I’m writing about this.

Of course, I’m talking about how Forbes is labeling Kylie Jenner as the youngest self-made billionaire. I think most people look at “self-made billionaire” and laugh for reasons that I hope are obvious. Her sister, Kim Kardashian, and the whole family have been household names since 2007… and while I have never watched the TV show, I don’t think anyone credits the success of the family to ten year old Kylie. If Honey Boo Boo made the whole family tens and/or hundreds of millions of dollars, I’d give her credit for being self-made. There’s a sizable gap between the Kardashian’s success and Honey Boo Boo.

(Note: I have to pause to make a disclaimer here. I’ve got zero hate for Kylie here. I don’t think she asked for the “self-made” label from Forbes. Even if she did, I’d still blame Forbes for granting it. I’d like to think that Kylie’s focus is, rightfully, on the word after the label. A billion dollars is a billion dollars.)

When I saw the self-made label being applied to Kylie Jenner, I instantly thought, “ShoeMoney!”

I’m sure you did too, right? (Probably not.)

One of the benefits of having been blogging since before Kim K debuted on The Simple Life is that I have a history of articles that most cover inane stuff. One of them was the phenomenon of an internet marketer named ShoeMoney.

ShoeMoney System

Back in 2010, ShoeMoney wrote an article about he built a million dollar product without Google. The product was The ShoeMoney System.

In 2010, I wrote that I’m not a fan of internet marketers. The reason why is that The ShoeMoney System was significantly promoted on the very popular ShoeMoney blog (which was in Google). It was also listed as a million dollars in revenue, not profit, which can be two very different things.

Today ShoeMoneySystem.com redirects to a blog post no ShoeMoney.com that has been taken down and gives and error. That’s the million dollar business.

Obviously, Kylie’s make-up business has a lot more staying power. I only want to compare the two, because neither seems to be self-made. Instead it seems to be a product of significant promotion from another source.

Is Kylie Really Self-Made?

I’d say there are four (maybe more) reasons behind Kylie’s success… and three of them shouldn’t be credited to Kylie.

1. Kylie Jenner’s Famous Family

It could be reasonably said that she was a product of her sister, Kim. In fact, when I looked up the Kardashians’ family net worth, People magazine wrote in the Kim Kardasian profile, “And hey, [Kim] can pretty much take credit for all of her siblings’ fortunes.”

It’s hard to make a case for being self-made if someone else can take credit for all your success.

It’s worth noting that Rob Kardashian is worth an estimated $10 million. So if you want to make an argument that Kylie’s a self-made billionaire, I think you also have to make a case that Rob Kardashian put together his $10 million fortune himself. For some reason, I don’t see anyone making that case.

2. Zuckerberg’s Social Media Empire

Fittingly, much of Jenner’s financial success is due to Forbes former youngest self-made billionaire, Mark Zuckerberg. The Washington Post (paywall) has a great article asking if is “self-made” really true. I think the key quote was at the end:

Even Jenner appeared to be aware that she isn’t fully self-made, telling Forbes Tuesday that her success was due in part to her existing influence.

‘It’s the power of social media,’ she said. ‘I had such a strong reach before I was able to start anything.’

It’s not that Zuckerberg invented all of social media, but Facebook (and Instagram of course) is the biggest platform by far. And Kylie Jenner is the highest paid Instagram influencer. They are estimated to be worth a million dollars each. If she makes a thousand Instagram posts, that’s a billion dollars without the need of a make-up company at all.

Obviously Jenner deserves significant credit for developing and cultivating such a strong social media presence. We just have to acknowledge, as she did herself, that “it’s the power of [the] social media” tool and family fame.

3. Seed Beauty

I wanted to learn a little more about Kylie Jenner’s make-up line. I was curious if she was really spending time in the garage testing out the formulas and refining the ingredients.

As you might be able to imagine Kylie Jenner isn’t spending her time in a make-up lab. The story behind the make-up is all that came from a company called Seed Beauty that “was built on the back of a 60-year-old family business.”

It turns out that Seed Beauty is extremely involved in the make-up. According to that article:

[Seed Beauty] would become a true partner of its brands, adding capital, brand incubation, and fulfillment to its hands-on offerings.

‘Brand incubation’, Laura explains, is a level up from the traditional celebrity brand and manufacturer relationship. White label or private label, as these arrangements are often referred, are largely transactional.

Don’t call Seed Beauty ‘white label’. The company is working hand in hand with brands to grow them from the ground up.

…

The paradigm shift, thanks to social influence, is that anyone can amass huge audiences, suddenly finding themselves in a position to monetize that influence. What do you do with an audience, nothing to sell to them, and no business experience?

Laura recognized an opportunity.

Does that sound like Kylie Jenner’s self-made business?

4. Kylie Jenner’s Smart and Hard Work

That article about Seed Beauty had a lot more to say than what I quoted in the last section. It said that Jenner plays a very active role in the business. It’s clear that she’s involved in all the decisions and that she isn’t just slapping her name on a product.

Importantly, Jenner set this all in motion by seeking out Seed Beauty and pitching them.

There’s a phrase that underpins my entire website, “Work smarter, not harder.” It’s clear to see that Kylie has worked smart. I don’t know enough to say whether she’s worked hard. From my position on the outside, it doesn’t appear like it. However, it’s not fair to make that assessment from a distance.

Forbes’ Definition of Self-Made

From all the above, it is clear that I don’t agree with the label of “self-made.”

That Washington Post article cited why Forbes used the words “self-made.”

Forbes actually put together a 10 level scale going from different types of inherited money to self-made. Here’s are definitions and examples of each level:

1: Inherited fortune but not working to increase it: Laurene Powell Jobs

2: Inherited fortune and has a role managing it: Forrest Mars Jr.

3: Inherited fortune and helping to increase it marginally: Penny Pritzker

4: Inherited fortune and increasing it in a meaningful way: Henry Ross Perot Jr.

5: Inherited small or medium-size business and made it into a ten-digit fortune: George Kaiser

6: Hired or hands-off investor who didn’t create the business: Meg Whitman

7: Self-made who got a head start from wealthy parents and moneyed background: Rupert Murdoch

8: Self-made who came from a middle- or upper-middle-class background: Mark Zuckerberg

9: Self-made who came from a largely working-class background; rose from little to nothing: Eddie Lampert

10: Self-made who not only grew up poor but also overcame significant obstacles: Oprah Winfrey

The problem that I see with this list is that Kylie Jenner could be seen as either #4 or #5. The fortune or business that she inherited is the family’s entertainment empire and social capital that goes with it. She could also be seen as the #6 who hired Seed Beauty.

One of the dangers here is that it looks like Kylie Jenner is in the middle. However, the first three categories are essentially the same to me. Also, I think we can agree that 99.999% (and many more 9s) of peole start in categories 8-10. Even the number of people in category 8 is pretty small compared to 9 and 10.

You can think of it as a very short and very wide pyramid with a almost everyone at the bottom and Kylie arguably starting at the top (or so close to the top that it isn’t worth dissecting).

Conclusion

I think this is one of those cases where it’s a combination of things.

It isn’t like a bag of a billion dollars fell right into Jenner’s lap. However, she’s obviously been in a very unique environment that was essential to her success. She’s used that opportunity to multiply her fortune many, many times over.

After nearly 1500 words, I think there’s still a lot more discussion to be had. Please don’t be shy and comment below.

Is It Really “Game Over” Financially When You Turn 25?

May 5, 2017 by Lazy Man 7 Comments

Quartz media yesterday came out with an article stating “Your financial fate is sealed by the time you turn 25”.

That title was so strong that I knew I was going to write it before I read it. I simply couldn’t believe how it could be true.

In fact, I typed all the above before finishing the article. As I read the article, it seems like a case were the title doesn’t match the article’s text completely. Here are a few reasons why your financial fate isn’t sealed by the time you turn 25:

The text of the article cites averages. Your particular case may not be the average. It might be, but it might not be. It certainly doesn’t feel that everyone’s financial fate is sealed by age 25 as the title seems to state.
You might meet your mate after age 25. I did and it made a tremendous difference in both of our financial fate. It reduced our living expenses while increasing our income.
We were mindful about our financial situation – The reduced living expenses allowed us to save and invest more. I put more time into learning about personal finance. Compound interest has been wonderful for us. All of this happened after age 25.
Percentage gains are not what they seem – The article seemed to show that the average person got their biggest percentage gains from age 25-35. It seems to me that you could at the Salary.com data for almost every profession and see that the biggest change is going from a starting salary to a person with 10 years of experience. It’s easier to make bigger percentage gains when you are starting out at smaller numbers. If you were making $50,000 and got a $25,000 raise, that’s a 50%. If you are experienced and making $125,000 and get a $25,000 raise, it’s only a 20% raise. It’s still the same $25,000, it’s not like your employer became cheap in not giving you 50% raises all the time. After you have gotten a few raises, the raises are naturally going to be a lower percentage.
(I don’t mean to suggest that $25,000 raises are normal, I just wanted to make the math easy.)

I get the idea that the article that the magazine is trying to express. It makes some interesting points elsewhere that may be worth analyzing. However, it got a little dry and it seemed like the numbers were so broad that it was make any useful conclusions.

So, instead, I’ll defer to common sense: Your financial fate is far from sealed by the time you turn 25. In a lot of ways, it might not be formed at all.

Welcome to Jack Johnson Week

April 24, 2017 by Lazy Man 1 Comment

This week I’m going to do something a little different. Don’t worry, we’ll still cover personal finance like we always do. I’ll just be covering some broader topics as well.

I’ve been wanting to write about Jack Johnson for some time. I had planned to simply write about his wisdom when it comes to personal finance and one other topic. However, it felt like writing about Michael Jordan and not mentioning basketball.

As this point, some of you may be thinking, “Who the heck is Jack Johnson?” The rest of you are probably thinking, “He’s that singer who sings that song from 2002.” (The song is Flake and the lyrics don’t don’t mention the title.)

I can’t imagine anyone is thinking, “Hey I need to read a week’s worth articles about this guy.”

Trust me, you do.

Why Now is Jack Johnson’s Time

There are two reasons why this is the perfect time for Jack Johnson Week.

This past Saturday was Earth Day.
While Jack Johnson is known for his music, he might be best described as an environmentalist who happens to play guitar. I’ll pay tribute to that tomorrow in a longer post.

Because saving the environment has oddly recently become a political issue in the United States, I feel it’s a great time to emphasize that we all benefit from things like clean water.
I’d like to recognize the amazing things that can some from a single person from an island in the Pacific.

I will be the first to admit that Jack Johnson comes off like a big hippie. What else would you expect from a former professional surfer/singer/acoustic guitarist/environmentalist? I’m sure his style isn’t for everyone, but I can appreciate messeages of sharing love. And as a father of a 3 and 4 year old, the message of sharing toys has been invaluable.

If this kind of stuff isn’t your thing, then I ask that you kindly check back next week.

Plan for Jack Johnson Week

Nothing is set in stone for this week, but here’s what I’m aiming for:

Tuesday: Jack Johnson on the Environment
Wednesday: Jack Johnson on Personal Finance
Thursday: Jack Johnson on Miscellaneous Topics. (This highly likely to change)
Friday: Jack Johnson on Something Different. (This is a bit of a surprise. A surprise that I don’t think even Jack Johnson could expect.)

Where Did the Idea for this Jack Johnson Week Come From?

I should make it clear that this isn’t an advertisement, but because I’m a big fan it may sound like one. He’s how I became a Jack Johnson fan in the first place. After all, five years ago that I was probably like you, a person who didn’t think twice about a one (or two) hit wonder from 15 years ago.

My fandom couldn’t have been more innocent. Our newborn loved this Curious George Opposites book. Back in 2013, I described it as one of the best frugal baby “toys”.

So with a background that our pre-toddler loved Curious George, it made sense to get the Curious George Movie.

That Curious George might be a top ten movie of all-time. It sounds crazy and if it is, then just blame it on me being sleep-deprived, new parent. I have rewatched more than 50 times… and not because the kids like it. (They did for the first 20 times and then they decided their father is crazy.)

Here are my Top 3 reasons why it is so good:

3. Drew Barrymore as a unique cartoon figure – Her character is an extremely intelligent teacher delivering the most insightful line of the movie. Also, from a male perspective, it’s refreshing to see her get a little tongue-tied talking to a man she has a crush on… and her self-effacing reaction for not doing better with the conversation. (Maybe it’s because I have been on the other side of that my whole life.) The illustrators made her physical appearance stand out, but not in an overly ridiculous way like Jessica Rabbit. Finally, Drew Barrymore’s voicing is just perfect for all the above.

2. Will Ferrell as The Man in the Yellow Hat – I am a huge Ferrell fan and I’d say this role might be one of his best. From the DVD extras it appeared he created much of the dialog and jokes… he wasn’t just lending his voice. It takes a special talent to keep a 2-year old and 40-year old entertained.

1. Jack Johnson’s music – Musicals are my wife’s thing, but I feel like the movie was a borderline musical. And why not? Kids love music! Every song does exactly what a good musical should do (IMO) which is “amp up” the emotion of the moment by 10x or 100x. There’s a reason why it was a best-selling soundtrack.

Jack Johnson’s music was so good that it bested a top comedian’s great performance and an iconic cartoon character (especially considering the limited screen time.)

(I’ve probably oversold the movie, but I came in low expectations. I love Office Space and Serenity for the same reasons.)

My wife bought that soundtrack. The last 4 or 5 songs are lullabies which are perfect for young kids (even better in a car!). I’ve been listening to many of his other songs on Amazon Prime via the Amazon Echo. Unfortunately the soundtrack isn’t available on Prime streaming. Fortunately, I’ve learn a lot from the other songs that are available on Amazon Prime.

That brings us full circle on why I’d have a Jack Johnson week.

I can identify with the lyrics and I feel he presents a positive message that we should all embrace.