Ira was writing about how he doesn't like to be the "dumb money" in his post on mutual fund analysis.  This of course led me to the same morose place I always wind up when I start thinking about my investment approach.  What in the world makes me think I can outperform the markets.  Most professionals don't do it, so why wouldn't I be in index funds? 

The short answer is that I am, but I'm also keenly aware of risks that are unique to me in my full financial position.  I may not be able to outperform the market, but I may be better able to hedge myself.  All of this feels to some degree like a rationalization though.

My broker knows better than to try to sell me junk, but I still talk to my family's brokers.  They are always coming up with these garbage products who's intent is to convince the buyer to pay a high commission.  That's their one and only goal.  I have nearly zero experiences with professionals where I don't find myself playing defense to keep them from trying to sell me junk.  If the whole industry is aligned against me, what makes me think I'm not the dumb money?

I think in the current era, we've become a little too accustomed to buying stocks.  In fact I think that most people think that "investing" and "buying stocks" are one and the same.  No one thinks about starting a business or other things they could do with their money.  They stick it into the stock market because "that's what you do."  Even worse our tax code is rigged to give them every incentive to do so.  All of this makes me nervous that I'm part of a ponzi scheme.  What do you think -- Are we the dumb money?

So Jess is apparently jonsing for the Bay Lake Tower.  I can't say that I blame her.  I'm pretty much jonsing for anywhere in Disney World.  I'm just not as picky.  While I'd love to do BLT, I'd be happy to do pretty much anyplace.

We stayed at Pop Century last year and it was awesome.  I can't even imagine what having the kind of view the towers do would be like.  I think it would probalby ruin me for everyplace else, so maybe it's best I never get the experience.  I'd really love to try it though, so if you're looking for a traveling companion let me know!

I'd also like to mention that if you're there, you should totally snag me a cupcake!

My friend Liza is trying to get a start in investing.  She knows she's ahead of the game because she's looking at investing instead of saving.  Most people are still worried about getting out of debt, much less saving or investing.  Meanwhile my friend Issur is worried about whether his travel expenses are justifiable.  These represent two issues of spending philosophies that people need to put some thought into:

Experiences vs. Possessions

One thing I think everyone needs to think about is which of thier spending habits have actually paid off and which have they regretted?  I read a study recently that described that most people regretted almost every major purchase except experiences.  Everyone felt like they had spent too much on their television, car or home, but almost never regretted money they spent on travel or other memorable experiences.  This is something you, and Issur, should keep in mind.  You rarely hear about people wishing they had spent more on their car, but you hear about people regretting spending too much on their car all the time.  Think about that the next time you are trying to figure out if an expense is justifiable.

Keeping Motivated After Getting Out of Debt

I also think that Liza's problem is really interesting too.  She doesn't realize that she's already jumped one of the biggest hurdles out there.  Most people only think in terms of "getting out of debt."  They worry about getting to zero, which is hardly an admirable aim.  Unfortunately after they get there they don't have that same urgency.  Being in debt causes a pain that not saving doesn't.  You also have the problem that most people think you're successful because you're better off then they are.  It's much harder to keep from spending if you know you've escaped the debt that's weighing down so many of your friends and family. 

Don't let this be you.  Think about those regrets that possessions generally represent and make your money work for you.  Saving and investing are the tools for freedom.  Flat screen TVs are a millstone that will weigh you down.  Keep this in mind at all times.

Thank goodness for a willing subject.

Don't let DW know this, but I'm subversively working a plan to get a WDW trip in this year.  The plan was to wait until 2012, but I've seen some deals I think might be compelling.  At least they're compelling to me, hopefully she will agree once I have a chacne to work my magic on her.  I'll just have to be extra persuasive. 

Man the Posterous post-login screen sure gives you a lot of pressure.  It's now time to write your first post.  (or what?)