How to make money… Turn 12 months into 14

Let’s talk money.

Let’s say you’re you, and you invest with the brokerage firm that you use. And let’s say you invest twice a month, on the 1st and 15th, every month, because you set up your financial plan on automatic like a boss. What actually happens to your money??

Years ago, I was sitting around reviewing my experiments between different financial institutions and comparing numbers and results… and then, while sipping on my favorite beverage… I had an epiphany… Those M@therF’ers!!! They got me!!! And I didn’t even know it!!! And all along I thought I was doing the right thing!!!

So here’s the how this works. You buy on the 1st and 15th of the month through the institution of your choice (God forbid if you use a broker!!). And the trades are FREE!! So how could this be stacked against you?? Well, the institution debits your account on the day you “buy”. But you don’t really “buy” that day. What happens? The transaction of purchasing the stock doesn’t go through for anywhere between 2-4 days (sometimes more with weekends…). So your money, your green dudes, go and work for the institution for 2-4 days until the transaction goes through. Ultimately, they debit your account, hold your money, it works for them for 2-4 days, and then the transaction finally goes through.

This scheme… I mean way they do business… is prevalent throughout the financial industry. It’s what some might call making money on the float. There is a gap, where your money is NOT working for you. It’s working for them!!

If you do the math, each “buy” turns into 2-4 days every month where your money is in limbo (actually, it’s in their coffers, working for them!). Multiple 2-4 days per month times 12 months (for the year), and that institution is using your money for 48 days for free… Holy smokes man! If you invest once a month, that’s over 2 months every year that they make money on you. That institution just magically added 2 months of money working for them into a 12 month period. 4 months if you invest twice a month! More if you trade / invest more often!! Now multiply that times all the clients they have, and it’s starting to look like Fractions of a Penny from Office Space

It doesn’t have to work that way!

So, after all my research, there is one institution that when you buy, they actually make the purchase ON THAT DAY. As it should be. And then That Institution debits your account in 2-4 days later. So your money is working for you the whole time! No gap. Your money is sitting in your account for 2-4 days after you “buy.” There is no “on the float for the financial institution.” Compared to using those other institutions, you essentially get 2 months free money every year, where your green dudes are working for YOU!

Now that you know this secret, you’re going to turn the tables on these super slick organizations and have your money working in your favor. And you’re going to be a

What’s the name of the institution???

Use Vanguard* and become a Bad MoFracky.

*I don’t work for Vanguard. And they don’t pay me. Vanguard is the only institution that I’ve found that is owned by those that use its services. Essentially, Vanguard is owned by its funds. And the company’s funds are owned by the shareholders (that’s you, when you buy). So, the shareholders are the owners of Vanguard.