I’m Losing 50 Bucks to Be Happy, and I’m not Crazy

by David Ning · 15 comments

low balanceFor years, I tried to stretch my money to its maximum potential. Moving money across different online savings accounts for better rates, taking money out of my checking account as soon as it’s there, paying bills on the last possible day to get more interest,…, the list goes on. Basically, whatever you can think of to earn a few extra dollar or two of interests, chances are good that I’m doing it. My motto was simple – two dollars is better than no dollar.

It was fun at the beginning, but as the number of accounts and bills I needed to keep track of began to pile up, managing the cash flows became a mini part time job. At times, it was even a little stressful because inter-bank transfers take as much as three days.

Many of you know about my shift into passive investing through a diversified portfolio of ETFs. Again, I’m not in the camp that believe stock picking isn’t a better investment. It’s just that when I weigh the burden of the part time investment analyst job that comes with active investing, it’s not worth it.

Along the same lines of thinking, I will stop being a cash flow specialist. In order to do so, I will:

  • Keep money in the checking account as a cushion for monthly and credit card bills
  • Setup automatic bill pay, so no bills will ever be late. In cases where automatic payment is not possible, I will pay the bill as soon as it arrives.
  • Potential lost of interest is expected to be less than $50, which is well worth the lack of stress.

No more messing around with moving money in and out of different accounts to earn more interest. No more stressful days as I impatiently check for transfers to go through. No more reminders about when bills are due. Yeah there’s some lost of interest, but the lack of stress will more than make up for it.

Sometimes, the choice that leads to more money isn’t the correct one.

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{ 15 comments… read them below or add one }

FFB August 19, 2009 at 7:34 am

You’re not losing money. You’re paying for your free time. Trying to save and be frugal only goes so far without taking up too much time. It’s like when someone drives across town for gas that’s a few cents cheaper. If you can do better things with your time then it’s not worth it.


MoneyNing August 19, 2009 at 2:11 pm

Technically, I’m not losing it since I never had it too :) It was a fun title though.


David @ Dinks Finance August 19, 2009 at 11:48 pm

I agree. I saw a guy drive to a park I was at, go into the trash cans, and pull out maybe 10-12 bottles from each. No way that was profitable. The gas alone would eat up any money he’d make on the cans. Not to mention the fact he still had to drive to the recycling center at some point to actually convert the cans to cash. The guy needed a lesson on opportunity cost.



Tom P August 19, 2009 at 8:10 am

I was in the same crossroad a few years ago, and I decided to do the same thing. It simply wasn’t work the time to manage all numbers when the reward is really only a few bucks a month. Add to that the occasional hiccup causing overdraft fees and you almost come out even. Actually, not quite even because you end up having more stress and less time.


MoneyNing August 19, 2009 at 2:12 pm

Yes. The costly mistakes certainly eliminated ANY additional income these strategies would make.


finco86 August 19, 2009 at 12:51 pm

I totally agree. I look at the interest on money market funds vs. online saving accounts and can move money to make a few more dollars on my emergency fund and allocated savings, but I don’t want to move to a new interest bearing checking that has multiple requirements just to get a few dollars in interest. I then have to be much more diligent so that I meet the requirements to earn the most interest. I don’t think it is worth the amount of work involved and the increased stress.


marci August 19, 2009 at 2:08 pm

Make good decisions to start with, and then just ‘let it ride” – and it will take good care of you :)
Welcome to the old-fogeys’ club :)
No stress, no mess – fun fun fun.


Jason August 19, 2009 at 4:52 pm

I never understood why people spend so much time caring about the last few cents. I am all for being responsible, but I will never control my budget to the last cent. I still have a life to live and spending time looking at statements and numbers just isn’t what I enjoy.


Jessica Griffin August 21, 2009 at 1:57 am

Having been through the endless dance of moving my funds from one bank to another, I agree with you completely. With the interest on savings being minimal, it just isn’t worth all the stress.


Wilson Pon August 21, 2009 at 7:52 am

Thanks for the useful advices, Ning. Yep, in this case, we should be stick with the recently saving account, as it avoids us from becoming the victim of interests lost.


Save Money Hound August 21, 2009 at 7:33 pm

Time is money. Saving a few extra dollars isn’t always worth it. I like your 3 action points. The lessons learnt seem to be paying off for you. Well done.


RB @ Financial Samurai August 26, 2009 at 8:27 am

You should think about my “Going Broke To Win Big” strategy where I employ 3 banks to maximize my returns, and minimize my costs. It’s quite simple actually, and effective.

Over the past 10 years, I probably have saved/made $45,000 more than I could have if i co-mingled and kept everything all in one bank.


Slicing Through Money’s Mysteries


jennifer August 27, 2009 at 5:43 am

when i was earning 6% on all the money i had floating around from credit cards, ite was worth it and fun. for 3%, i agree, it’s not fun or worth it. i’ve started paying off the credit cards because i don’t want to play anymore :)


Lee August 27, 2009 at 6:07 am

I think that’s a good investment; in yourself. $50 versus (potentially) 50 hours a year trying to earn that $50? That’s just not good money sense. As other comments said, frugality should only go so far.


Witty Artist June 2, 2011 at 12:33 am

For sure moving funds from one place to another and keeping track is stressful. And for a few more bucks it’s just not worth the time I lose. Who knows, in that time I can make more money then the saved one.


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