Close Menu

Main Content


Investing Blog Container

The Economics of Animal Crossing

The Economics of Animal Crossing


By Kelly Griese

Wednesday, July 15, 2020

All it took was a pandemic to turn a 19-year-old video game franchise into one of the most popular ways to waste time at home. I’m talking about Animal Crossing: New Horizons (ACNH).

What is ACNH? You start the game by agreeing to move to a deserted island being developed by a somewhat shady raccoon named Tom Nook. Tom is big on upselling. He will always convince you to borrow more money in order to buy and build bigger and better things for your new island home. Through the course of the game, you gradually develop the island into your own paradise, all while making friends with talking animals. 

ACNH was released on March 20, 2020. The franchise began in 2001, but the latest game, exclusively available on the Nintendo Switch, has sold more than 13 million copies. It sold more in its first six weeks than any previous Animal Crossing game. Getting your hands on a copy of the game is easy, though don’t look for a drop in price anytime soon. It sells for close to $60. But getting the console you need to play the game may be challenging. As Forbes reported in April, gamers had better luck finding toilet paper than a Switch. What’s causing the shortage? Well, a few things, all related to supply and demand. The Switch is manufactured in China, and the pandemic forced factory shutdowns, meaning supply dropped. This happened at the same time as an increase in demand (though the Switch was certainly popular before the pandemic). But there’s an even bigger problem driving shortages: bots buying up stock before it can reach store shelves. Once the bots have done their job, the folks who use them can then resell the Switches on eBay or Amazon at a huge premium. Switch’s retail price is around $300, but a quick look at Amazon right now will show you consoles selling for $500.

But enough about the real world supply and demand issues, let’s talk about the in-game economics. I’ve been playing the game myself for about two weeks, and here are the financial concepts I’ve encountered so far: 

  • Loans, Financing, and Home Ownership
  • Fundraising
  • Donating
  • Supply and Demand
  • Producers and Consumers
  • Goods and Services
  • Return on Investment
  • Stock Market

There are two types of currency in the game. Bells and Miles. Think of Bells as cash. Think of Miles as rewards points. You can earn Bells by selling a number of consumable products that you can collect on your island, such as fish, insects, fruits, wood, and minerals. You earn Miles through experience. So what do you do with all this currency? Well, you buy stuff. Lots of stuff. Let me breakdown some of the above financial concepts with examples. 

Loans, Financing, and Home Ownership

When you first move to the island, you immediately owe Tom Nook 5,000 Miles for moving expenses and a tent to live in. These first 5,000 Miles are easy to earn, so you’re able to pay off your debt within your first day of playing. From that point on, each improvement of your living quarters, from a one-room house to a six-room mansion results in you taking out additional mortgages. In total, you will spend 5,696,000 Bells to reach mansion status. (For the record, my home currently has four rooms, and I still owe about 250,000 Bells on my most recent home expansion.) Loans and financing are real world things that adults understand, but these are new concepts for many of the children playing the game. What’s different about ACNH is that these are zero-interest loans and you can take as much time as you want in repaying your mortgage. No late fees! 


As I mentioned above, the primary method for earning Bells in the game is through gathering and selling consumable items you find around the island. Some of these items are incredibly common, others are rare. As you might imagine, goods that are harder to find fetch a higher price when you sell them. For example, a Coelacanth (a type of fish that’s critically endangered in reality) sells for 15,000 Bells. That’s some serious money that could be used toward paying off your debt or buying cool new stuff. But the game encourages you to donate one of every type of creature, fossil, and piece of art found on the island. These donations are then placed on display in an elaborate museum. ACNH players are quite proud of their museums. I know that I was particularly excited when I caught my first Great White Shark, and even though I could have sold it for a lot of Bells, I donated it to the museum so I could regularly visit and watch it swim. I’m still searching for the elusive Coelacanth. The concept of donating in the game is interesting. The reward players receive for donating is not monetary, but they do receive a great deal of satisfaction in working toward a complete museum collection.

Supply and Demand

While most sellable items in ACNH have a set price, there are times you can earn extra income. For example, Timmy and Tommy Nook, who buy anything you find on the island, have a “hot item” every day. This is an object that you can craft using raw materials you find on the island. My first “hot item” was a simple wooden nightstand. By harvesting wood from every tree on my island, I was able to make several dozen and sell them at a marked up price. There are other ways to maximize profits. Some of the animal characters in the game have particular appetites. For example, C.J. is a beaver who will occasionally visit your island and pay 1.5x more for fish than Timmy and Tommy will pay.

Stock Market

No discussion of Animal Crossing: New Horizons would be complete without talking about turnips. Yes, turnips. Each Sunday, an animal character named Daisy Mae will arrive on your island to sell turnips. The cost of the turnips varies from island to island. For example, mine cost 108 Bells earlier this week, while a friend of mine reported her cost as 103 Bells. Fortunately, we found another friend who had turnips for 92 Bells each. We immediately visited his island to buy as many turnips as we could carry. Why? Because throughout the rest of the week, we will have the opportunity to sell our turnips for a huge profit (or loss). You have just one week to sell turnips bought on Sunday, before they rot. On Monday, I checked the value of turnips on my own island, and I could sell them for 142 Bells each. Yes, it’s a profit, but last week I sold my turnips for 459 Bells each! As with the real world stock market, the goal is to buy low and sell high. I want the best return possible, so I start by asking my friends about the prices on their islands. If they have an exceptionally good price, I simply travel to their island to sell. But if they don’t have good prices either, that’s when I turn to the internet. ACNH players from around the world use social media, apps, and websites to communicate about turnip prices and negotiate island visits. One of the more popular apps is called ACNH Exchange. On it, players can post their current turnip prices and agree to host other players on their islands. But there’s a catch. The lines are long (I’ve seen lines up to 13 hours long), and hosts often demand high value items in exchange for allowing you to visit. This is when a player must consider the return on investment. Is the time spent in line and the fee for accessing the island worth it? I got lucky last week and was able to visit a friend’s island to sell my turnips. There was no wait, and the friend didn’t charge me any fee. This week, I have 2,000 turnips to sell, so now I’m aggressively looking for the best price with the lowest fee and shortest wait.

Economic Education

All of the above commentary might make you think Animal Crossing: New Horizons is a stressful game. Personally, I find it incredibly relaxing. It’s also been a fun new thing to do with my friends while we’re all social distancing. My ACNH character can visit their islands, and they can visit mine. It’s a safe way of hanging out together. 

What I wasn’t expecting when getting the game was the economic education built into it. The financial concepts explored in-game and the real world economics that have evolved with the game’s popularity make it all the more interesting for me, as someone who educates others about personal finance and investment fraud. If you’re looking for a fun way to introduce your children to some basic financial concepts, Animal Crossing: New Horizons might suit your needs. Just make sure you have conversations offline about differences between the game and reality. 

Meanwhile, I’m going to look for ways to integrate Animal Crossing into the activities and presentations we offer for kids. I encourage you to take a look at what we already have to offer by checking out a previous blog post

If you want a lot more in-depth information about the economics of Animal Crossing, here are some of the articles I read before writing this blog post: 

Blog Topics:
Budgeting, Credit, Investing 

Strong Finances for a Strong Emotional Wellbeing

Strong Finances for a Strong Emotional Wellbeing


By Kylee Hale

Wednesday, June 24, 2020

There are multiple things contributing to the anxiety Americans are feeling right now. With many people working from home while caring for children, and juggling health concerns, it’s no surprise that people are feeling stretched to the limit. According to a recent survey by the National Foundation of Financial Education, nearly 9 in 10 Americans say that money is a primary cause of anxiety. 

As cities begin to reopen and attempt a slow return to normalcy, the tens of millions of Americans who lost their jobs or were laid off will continue to worry about their livelihood and feel the emotional toll. According to a poll by the Kaiser Family Foundation, 45% of U.S. adults report that their mental health has been negatively impacted due to worry and stress over the virus. Another survey, showed that 69% of American adults have financial worries, which are heighten by three major concerns: not having enough savings, losing a job, and not being able to pay debts. Even in better times, financial concerns can cause a lot of stress. Regardless of the circumstances, here are some ways to ease your mind if you’re dealing with the common money stressors. 

You are in control

Every one of us is experiencing change to some degree, which means we have to think differently to get through this. What you were doing before may not work now, but embracing the things you can control will provide stability during these unsteady times. Some things that you can control are spending, saving, and your reaction to market events. 

If you are struggling and your emergency fund is dwindling, you should examine your expenses. Rethink your budget and prioritize the bills that cannot be put off. For Hoosiers, the Governor’s order prohibits evictions, foreclosures, and utility service disconnects through June 30th. You can read more about this in our Deadlines and Delays post. Many states have issued executive orders to block evictions and many state courts are not accepting eviction filings until further notice. 30% of Americans have not paid their housing payment this month. While this is not something to promote, there are safeguards in place to keep Americans from losing their shelter. 

Creating an emergency budget can be helpful to review spending and saving. Track online spending and avoid triggers to cut out unnecessary purchases. Unsubscribe from emails, unfollow brands and influencers on social media, and delete browser history to help control spending.  It’s still important to save whenever you can, but you may have to redirect some of your saving goals to more pressing financial needs. 

For investors, while you can’t control the market, you can control your reaction to the fluctuation. If you’re wondering how to survive this unpredictable market, try to remind yourself to relax and ride it out. Attempting to time the market isn’t a good strategy and can result in costly mistakes. For help on convincing yourself to be content check out this post on market correction

Rid Yourself of Anxiety

Understanding how anxiety relates to your financial decisions can provide you the peace of mind you need. Stress and worry have adverse effects on our spending habits, often contributing to more spending and less saving. Similar to stress eating, stress spending is something we do to try to make ourselves feel better. On the other hand, saving is really what makes us feel better and more prepared for the unexpected.  Try putting extra thought into purchases and determine if they are unnecessary. Saving more money at this time can put you more at ease in the case of a future unplanned event.

If paying bills is a hassle to you, a way to reduce the stress of remembering to pay on time is by setting up auto pay or bill pay. Auto pay can be scheduled through the service provider and bill pay can be set up through your bank. With bill pay, the bank automatically issues regular monthly payments and you can do this for mortgages, student loans, rent, utilities, car loans, and even credit cards. Give your mind a break and some clarity by not worrying about missing a payment. In addition, to automatically paying your bills, you can arrange to automatically save. Establishing regular payments into your savings account or retirement account is a good way to ensure you do save and this will help you reach your savings goal. 

Being proactive rather than reactive instills a sense of preparedness and minimizes the pressure felt when an emergency does occur. It is difficult to prepare for an emergency as it is unexpected. The best way to stay calm is to be flexible. Come up with a plan or an adaptable process that allows you to maintain your livelihood when the world around you changes. Four proven and effective financial strategies that will help you get through whatever comes at you are to spend wisely, save for emergencies, stick to your goals and invest for the long term. These strategies are successful all around and sure to reduce tension in difficult times. 

Studies have shown that actively managing your finances can have positive side effects. By putting in the effort to save money, you’ll create an emotional buffer that’s sure to reduce anxiety. Being aware of your financial plan will provide confidence and less tension when the unexpected does occur. Even taking small steps or implementing just one or two strategies for better money management will give you a better mental outlook. 

Take Advantage of Available Resources

If you continue to feel worried, reach out to a partner or a friend. Discussing financial fears together can help you find a better solution. If you prefer to talk to a professional, there are multiple free resources available. For example, the National Foundation for Credit Counseling offers a COVID-19 Emergency Financial Help toolkit with access to chat counselors for advice. The National Association of Personal Financial Advisors and the Financial Planning Association also provide certified financial planners and advisors at no cost. 

Virtual health visits are also gaining popularity. Most insurance providers cover a variety of mental health resources and many therapists are available for telehealth appointments. For more information on mental health services contact your insurance provider or employer as some employers have free counseling through employee assistance programs. Lastly if you feel you are suffering from mental health issues, the Substance Abuse and Mental Health Services hotline does not require insurance and is available 24/7.

While it may not be as obvious as stress eating, financial stress can be detrimental to your health, mentally and physically. Just as we try to stay physically fit, it’s important to remain financially stable in difficult times. Being in control of your financial decisions and being prepared can do wonders for your overall health, mentally, emotionally and financially. You don’t have to go into overdrive to be financially prepared but any effort made to better weather the storm will make you feel better all-around when crisis does occur. 

Blog topics: 
Budgeting, Credit, Investing 

How Coronavirus has Affected Wedding Season and Tips for Investing with Your Partner

How Coronavirus has Affected Wedding Season and Tips for Investing with Your Partner


By Kylee Hale

Wednesday, June 10, 2020

Every year there are over 2 million weddings in the United States, and this 78 billion dollar industry has been brought to a halt by COVID-19. As wedding plans are drastically changed, couples and vendors look for a plan B. For some, a change of plans means reducing the guest list while others are rescheduling for next year. Venues and vendors are adapting to offer packages for smaller parties. These include mini ceremonies and micro luxury weddings with over the top service for a smaller guest count. However, with the economic decline and stressful financial situations that many are dealing with, some couples are sticking to a reduced budget and cutting back altogether.







It is likely that smaller ceremonies will be trending through this fall and wedding insurance will be a higher consideration for newly engaged couples. Unfortunately it is too late for couples to purchase insurance coverage for the impact of COVID-19, but couples can purchase insurance for future unexpected events. In the wedding and event industry there are two main types of insurance available. Liability insurance may be required by the venue and typically covers any damage done by the bride, groom or their guests and can protect the married couple if guests leaves the event intoxicated. The other type is Cancellation insurance which covers lost deposits in the case of severe weather, accident, illness, injury or business bankruptcy. 

When engaged or soon to be married, it’s easy for couples to put their focus on the big day. While a wedding and reception may be exciting, this is not the most important aspect of being joined by marriage. Before agreeing to tie the knot, couples should have a frank conversation about money and investing.

Disagreement over money is a common source of tension for couples and an oft cited reason for divorce. But these discussions are impossible to avoid as you build a life together and plan and save for retirement.

When it comes to investing, couples might have different ideas about financial goals, the types of products to invest in and the level of risk they are willing to take with the family's portfolio. Fortunately, there are things couples can do to bridge the investment style gap and keep the peace. Here are four tips from FINRA, to help you keep the harmony in your relationship.

Communicate. Like many other issues in relationships, the key to maintaining harmony is to begin with a conversation. It's important for each partner to understand the other person's tolerance for risk. It's equally important for couples to talk about their financial goals and how soon they hope to achieve them.

It's a good idea to touch base regularly about household finances and working together to create solutions—like a budget or investing plan.

Get educated. Knowledge can give couples the power to resolve financial differences. If you work to learn the basics of investing together, you can feel comfortable knowing you are speaking the same language and both understand the risks involved with different investments and different strategies.

Get started with the FINRA Foundation's free Course to Smart Investing, which is designed to fit into your busy lifestyle. And, bonus, the theme of the course sequence is love and relationships!

Divide and conquer. For some couples, it might be better to divvy up accounts and responsibilities. You might have the more conservative partner handle the savings for short-term goals, such as saving for a down payment on a house, where a conservative approach is often justified.

The more aggressive partner, in turn, could possibly oversee savings for long-term goals like retirement, where investments can be more aggressive when retirement is still many years down the road.

Hire a referee. Sometimes couples simply can't figure things out on their own. A financial professional can help couples get beyond two opposing investment styles and make recommendations based on what's mutually beneficial for the couple.

It might just be worth the cost and effort. After all, managing a relationship is hard enough without having to fight about money.

For more information on discussing your finances as a couple, check out our Money Skills for Newlywed Couples guide. 

Blog topics: 

What is Market Correction?

What is Market Correction?


By Kylee Hale

Wednesday, March 18, 2020

Market Correction1

With investments, it can be said that a stock index enters “correction” territory when it falls by more than ten percent, and this alarming drop can put many investors on edge. A lot has happened recently in large part due to coronavirus concerns resulting in canceled meetings and reservations, supply chain disruption, an oil price war and on top of that we’re in a presidential election year. As an investor or onlooker, you may be wondering what this really means and what to expect next. So let’s look at some of the common questions. 

Is it the beginning of a bear market? 

Let’s go back and define market correction, there is no universal definition but most consider a correction has occurred when a major index such as the S&P 500 index or Dow Jones Industrial Average, declines from its most recent peak by 10% but still less than 20%. Historically the drop returns or “corrects” prices to their longer-term trend as this is referred to as the “correction”. It’s not really possible to predict whether a correction will reverse or turn into a bear market, meaning that the market falls by 20% or more. As of last week Dow Jones, the S&P 500 and the Nasdaq all entered a bear market. Since November 1974 there have been twenty-two market corrections, four (five if you include the current) of which became bear markets. 

What if this is the start of a declining market?

It’s easy to forget that the market cannot and should not go up indefinitely. After a long run of a bull market, shares of stock are selling at a premium, a correction would be better seen not as a sign of doom but yet as a sign of opportunity. While bear markets can be scary, they are part of long term investing and they don’t last forever. The average bear market has lasted 17 months which is far shorter than the average bull market and they can end as abruptly as they begin. 

How to survive the market dip? 

We don’t know how the coronavirus will play out – nor does anyone, really. While we navigate our way to progress the markets will remain bumpy. This uncertainty is uncomfortable and driving volatility in the markets. We are experiencing an economic slowdown as we’re all affected by the social distancing. What we don’t know is how long it’s going to last, but we can be almost certain to expect growth to rebound, even if it doesn’t happen this year. 

In China, where the outbreak originated, a decline in new cases of the coronavirus is already happening, showing that travel bans and canceling public gatherings is working to stop the spread. Economically, as a country we are in better shape than the 2008 bear market, because our large banks aren’t as highly leveraged, meaning they’re better equipped to handle this now than they were back then. Worrying about the spread of the virus and the bear market is counterproductive, but being prepared is a good approach. 

Is there anything I can do?

Have a plan. A written financial plan can help you weather the storm and calm your nerves. Think of your short and long term goals and stay the course as the market gets bumpy. Consider your risk, it’s easier to take risks when the market is rising, however, market downturns can provide a time to consider adjusting your asset allocation. Remember you can’t lose any more than the money you put into your investments and regular rebalancing will help keep your portfolio on target. If you are tempted to sell and buy again later, CNBC has demonstrated if you had invested in the market from 1999 to 2018 and not touched it, your money would have doubled. But if you had jumped in and jumped out of the market and perhaps missed out on the ten best performing days in the timeframe, your returns would be cut in half. Lastly, it is important to consider your life stage or age. As young investors have time to recover, those nearing retirement would favor diversification and a more conservative approach. It might be a good idea to avoid selling assets and postpone planned withdrawals for large expenses. It's important to remember that a loss is not official until funds are withdrawn and it's recorded on paper.

Blog topics:

Compound Interest Benefits the Lender, Not the Spender.

Compound Interest Benefits the Lender, Not the Spender.


By Kylee Hale

Wednesday, March 4, 2020

In my last post, I explained how remarkable compound interest is and how its positive effects can really boost your savings. However, compound interest also applies to most of your debt like student loans, mortgages and unpaid credit card balances. For those who pay compound interest on loans, it can dig a deep hole that may be difficult to escape. Here's a few examples of how compound interest can dig financial holes:

Compound Interest on School Loan

Brandon took out student loans to fund his education, finishing school with $50,000 in student loans at a 7% annual interest rate. Brandon was not able to find a job in his field with a competitive salary, so he entered an income-based repayment program to make ends meet, paying $200 per month. While the repayment program freed up money to help him pay his monthly bills, the payments were not enough to cover the interest on his student loans, much less the principal. After ten years, Brandon’s loan balance grew from $50,000 to $65,866, despite making payments every month. Time and compound interest caused his loan balance to grow. To the right is an example of Brandon’s $50,000 loan with compounding interest creating more debt just over one year.

Brandon’s sister Amanda wanted to go on vacation, but had not saved enough money. Instead of scaling back her plans, she booked a trip to Tahiti on her credit card. Unfortunately, Amanda was unable to pay off her credit card balance, and the interest charges began to compound. Amanda went from owing $10,000 to owing more than $10,786 one year later, even though she paid $150 per month. The credit card’s high 25% interest rate meant that Amanda’s $150 payments didn’t even cover the interest on her debt each month.  


What can I do to avoid the pitfalls of compound interest?

  1. Be discerning about debt. Don’t take on unnecessary debt like Amanda did. Make sure you only take on debt that you can afford to pay back, at an interest rate that won’t hinder your ability to save for your future.  
  2. Pay down high-interest debts. If you already have high-interest debt, refinancing to a lower rate could be a solution for you, but might not make sense for everyone. Do your best to pay off high-interest debts before the compound interest takes its toll on your finances.

Compound interest should be used to your advantage, and to invest for your future.  Be cautious in taking on debt and understand how compound interest can derail your finances.

Blog topics:
Investing, Budgeting

The Devil You Know

The Devil You Know


By Kelly Griese

Wednesday, February 26, 2020

Affinity Fraud

You know the phrase, “better the devil you know than the devil you don’t,” but it isn’t true when talking about investment fraud. Specifically, I’m talking about affinity fraud. It’s a financial scheme that involves a scammer who appears to be part of a community or interest group. The scammer builds trust within the group and exploits that trust to push fraudulent, non-existent, and too-good-to-be-true investments on other members of the group. 

Simply put, affinity fraud is the wolf in sheep’s clothing. 

Affinity fraud is most likely to occur in groups or communities of like-minded people. You’ll find it almost anywhere that people gather around a shared belief, interest, or goal. Examples include:

  • Places of worship
  • Tight-knit ethnic or immigrant communities
  • Country clubs
  • Professional organizations
  • Places of business
  • Online forums

Why It Works

Affinity fraud is successful for a few reasons. For starters, it’s human nature to trust people who are similar to us. I played a game once with some fourth graders who were visiting the Indiana Statehouse for Statehood Day. In the game, I played the role of an affinity fraudster, and a coworker played the role of a victim. The common interest that my character exploited was a love of the Colts. I started by hyping up the team and sharing stories about watching football. Once it seemed clear the victim saw me as someone trustworthy because of our shared interest, I mentioned a “great investment opportunity.” The victim was excited to hear more. That’s when she turned to the kids, asking if they thought she should invest. They quickly informed her that I could not be trusted, and my greatest joy was having one of those children call me - the fraudster in the skit - a “dirty liar.” 

Another reason why affinity fraud works is that victims are often reluctant to report someone who they feel is part of their group. The victim could be afraid that they won’t be believed or that other members of the group will be angry with them. The fear of reporting allows the fraudster to remain within the group, conning more and more members. 

Here’s an example of affinity fraud shared by the North American Securities Administrators Association (NASAA): 

Desiree has been attending the same church for many years. One day, the pastor introduces a new member of the congregation, Jim. Jim spends the next several months getting to know parishioners, and even reads scriptures and gives sermons for the pastor on occasion. Everyone loves Jim!

Jim gathers a group of parishioners one Sunday after service, including Desiree, and tells them about an exclusive investment opportunity that he has just for them. Jim’s investment pays more than their savings accounts and has zero risk, but he needs a check or cash before he leaves church that day. Desiree knows Jim and trusts him, so she gives him a check for $2,000. Like clockwork, the interest checks come in and the statements Jim gives her show huge gains in her account!

Desiree is so impressed that she gives Jim the rest of her savings and tells her sister Nicole, who also invests with Jim.

Two months later, Desiree stops getting the promised returns. Jim assures Desiree that everything is okay, it’s just an issue with a supplier of the company that is funding the returns. Desiree believes him and agrees to wait it out. Jim stops coming to church, and stops responding to Desiree, Nicole, and the rest of the church members that invested with him. When they report the matter to their local securities regulator, they find out that Jim and the product were unregistered, and that their savings are likely gone forever.

Protect Yourself

So how can you protect yourself? First, know that affinity fraud is common. It happens every day all over the U.S. You should be cautious if you’re ever approached about an investment opportunity at church or in a community group. 

  • Don’t act on personal feelings. People who commit affinity fraud are usually very likable and seem trustworthy. Investors should never let their comfort with a person’s character and status in the community replace adequate due diligence. Ask questions.
  • Don’t act too quickly. If someone offers you a can’t miss investment opportunity and puts you on the spot, don’t be afraid to walk away. Never make an investment decision without understanding where your money is going, how it will be used, and how you can get it back.
  • Everything has risk. There is no such thing as a risk-free investment, and anyone who promises otherwise is lying. Investors should always ask about the risks of the investment, and understand issues such as liquidity, investment time frame, rate of return, risk of loss, and how the proceeds of the investor’s investment will be used to turn the promised profits.
  • Trust but verify. Affinity fraud frequently involves someone that the victim has known for many years. The simple fact that you’ve known a person for 20 years does not replace the need to ask questions about any investment opportunity, and to take pause if you don’t understand it.
  • Always ask if the person and the security are registered. Contact the Indiana Securities Division or search FINRA’s BrokerCheck database to confirm if the salesperson is registered. Regardless of how long you have known a person or been conducting business with an individual, it’s worthwhile to do a quick search in the database to confirm up-to-date licensing and compliance. If the person isn’t registered, ask why, and carefully consider if the investment is worth the risk.

If you think you are a victim of affinity fraud, contact the Indiana Securities Division

Blog topics:
Fraud Prevention, Investing 

Why Compound Interest Matters

Why Compound Interest Matters


By Kylee Hale

Wednesday, February 19, 2020

Compound interest has been called the 8th Wonder of the World. It can be a double-edged sword, benefiting those who use it to build wealth, and burdening those who accrue interest on loans and dig themselves into deep financial holes. Let’s discuss the basics of compound interest and the effect it has on your financial future.

What is compound interest and how does it work?
Compound interest is interest calculated on an amount of principal (e.g., a deposit or loan) including all accumulated interest from prior compounding periods. Put more simply, it is interest on top of the interest previously added to the principal. Compound interest causes principal to grow exponentially over time. In the case of invested assets, it is a powerful tool to build wealth.

Examples of how compound interest can help build wealth:

Compound Interest


Warren recognized early in life that if he routinely saved and invested, he could accumulate wealth and live a better life. He started investing at 22, adding $500 per month to an account which held an index fund tied to the stock market. The index fund returned 7% per year for the next 40 years, when Warren retired at the age of 62. The initial $500, and the monthly contributions thereafter, grew to almost $1.2 million thanks to time, compound interest, and Warren’s investing strategy.   

Compound Interest




Warren’s friend Charlie wasn’t able to put away as much as Warren during his career, but he invested a $10,000 inheritance at 22 in the same index fund. Charlie’s investment, despite him not adding any more money to it, was worth almost $150,000 when he turned 62.  How? Time and compound investment returns caused Charlie’s inheritance to grow without him adding a penny.



From these examples, you can see how remarkable compound interest is and why you would want to take advantage of it whenever possible. However, compound interest also applies to most of your debt like student loans, mortgages and unpaid credit card balances. In my next post I will explain how compound interest can have a negative effect and how you can best avoid it. Here are a few tips on how to get the most out of your money with compound interest.

Don’t just save — invest! To take advantage of compound interest, your savings must be in an account that pays some kind of return on investment. That rate will depend upon the amount of risk taken. Higher rates of return are associated with higher risk of loss, and lower rates of return are associated with lower risk of loss.   

Start as early as possible: Time is one of the most important elements of compound interest. The longer your money is invested, the more opportunities it will have to grow. A 25-year-old who puts away $500 a month until age 65 with a 7% rate of return would have nearly $1.2 million, while a 35-year-old doing the same thing would have only $567,000 at age 65.  The earliest years of investing are the most important when it comes to compounding.

Be consistent and patient: Consistent contributions to an investment account over time gives compounding more principal to compound on and can enhance returns. As Warren and Charlie discovered, even modest contributions, paired with investment returns over long periods of time, can help you reach your financial goals.

 Check it out for yourself: The U.S. Securities and Exchange Commission has a compound interest calculator available on their website. Look at what your savings could look like based on different timeframes and rates of return.

Blog topics:

5 Reasons to Shift Investments

5 Reasons to Shift Investments


By Kylee Hale

Wednesday, February 5, 2020

We must start off saying, it's best not to stir up your investments. When you choose to invest, it’s advised to relax and ride out the roller coaster twists of the market. Trying to beat the market is not a good strategy and often doesn’t work. Stick to the motto of investing steadily, diversely and for the long term. This will provide the most foolproof route to success.Set it and forget it


However, there are times when Showtime’s rotisserie chicken oven infomercial tagline “Set it and Forget it” just isn’t meeting your needs. Here are 5 relevant situations where you might be better off moving your funds around.


  1. New job, new retirement account  

If your employer provides the option to invest in a 401(k), 403(b) or similar retirement saving vehicle your contribution to this investment typically cuts off when you terminate employment with that employer. It’s often a good idea to consider rolling the funds over to your new retirement saving investment vehicle whether that’s a new employer-sponsored plan or a different account of your choosing. It is possible to leave the account as it stands but this could become a loose end. If you choose to roll it over, you’ll want to follow the protocol from the IRS to avoid a tax penalty and opt for a direct rollover to reduce tax filing complications.

Side note: In a previous post, I analyzed the state employee’s paycheck. The state-sponsored 457 plan is yours to keep after you leave state employment, and you can roll it. There is no age penalty but you are responsible for paying income tax on the funds.


  1. You're over the fees

There will always be fees, every cent you pay in fees is a cent not in your account, not earning returns. If you’re using a digital adviser, you can expect to be charged about 0.25% - 0.30% of your assets per year. If you’re shelling out for fees themselves, or if moving your investment could lower your fees, it’s probably a good idea to make the move. You may also consider moving your investments if the options you’re looking for aren’t available for you. If impact investing or investments made to generate positive, measurable social and environmental impact alongside a financial return, is your desire, you may have to shift your investments to meet this ambition.


Memory Overload

  1. Requires excess memory 

An overall financial picture can be difficult to maintain if you have multiple accounts. Consolidating your investments can ease your stress and create a simpler way to follow your investment goals. Another benefit of having your investments all under one scope is the ability to work with a single person or company. Developing a relationship with one person that you can speed dial with all your investment questions is a relief when it comes to money. Multiple accounts also means multiple logins, statements, and tedious account updates when your address or beneficiaries change.


  1. Need some risk or stability

Managing your investments all in one spot can avoid overlapping investments, but it’s still important for your portfolio to stretch across multiple asset classes. Maintaining balance within your portfolio might urge you to shift your asset allocations. Maybe you bought a stock a while ago and then inherited a similar or were gifted an investment. Rebalancing your portfolio helps preserve your desired amount of risk and continue progress towards your goals.


  1. Retirement is on your horizon

When you’re getting close to the golden years you may want to reevaluate your assets. You can’t keep money in tax-advantaged retirement accounts forever. There are age restrictions on certain accounts and you are required to begin withdrawing at least the minimum distributions. If you don’t, you will lose that hard-earned and saved money to penalties. It’s easy to forget about an old 401k, from a previous job, if you have not consolidated in a while.​​​​​​


As you may have noticed none of the examples above include moving investments due to market dip. It’s important to remember when investing if you experience a market plummet or prolonged downtown, the loss is not locked in until you sell. History shows the market always returns and often surpasses the previous high. If the conditions above apply to you and you decide the time is right to shift your investment, be sure to ask about a direct rollover or in-kind transfer to ease the process. Investments and taxes can be complicated, if you have any questions, be sure to seek out a licensed professional. To confirm a professional licensure, you can search the database on the Securities Portal. 

Blog topics:

What Exactly is a Real Estate Investment Trust?

What Exactly is a Real Estate Investment Trust?


By Kylee Hale

Wednesday, January 22, 2020

In past years, stocks would have been considered the best long term investment, but as of last year, real estate has made its way to the top. According to this Bankrate survey that asked Americans “What is best way to invest money that you wouldn’t need for more than 10 years?” approximately 30% of all generations are in favor of real estate as a long term investment. Real estate can be a very lucrative investment at any age, however it usually requires a lot of money, or very good credit, to get started and is known to be a big time commitment. For busy individuals who might not have the extra cash for a huge down payment, a real estate investment trust (REIT) might be a less demanding way to get started.

Market Exposure - REITs allow investors to pool money together to invest in large-scale, income-producing commercial real estate. These may include office buildings, shopping malls, apartments, hotels, resorts, self-storage facilities, warehouses, and mortgages or loans. This collaboration provides people who may not have the funds to buy commercial real estate on their own with the opportunities to invest but without the time commitment and cost of buying and managing a property. 

Diversity - By being in a different asset class than stocks or bonds, REITs, provide the opportunity to diversify a portfolio. REITs can be found in public and private markets, although publicly-traded REITs are the most liquid. Before investing in a REIT, you should understand whether or not it is publicly traded, and how this could affect the benefits and risks to you. For more, check out FINRA’s Investor Alert on reviewing non-traded REITs.

Appreciation - REITs are generally passive investments as opposed to active…meaning that they are generally suited best for long term investors rather than short term. Unlike other real estate companies, a REIT does not develop real estate properties to resell them. Instead, a REIT buys and develops properties primarily to operate them as part of its investment portfolio. A benefit to investing in REITs is the potential for long-term appreciation, if the real estate market you're invested in gains value, your shares may too.

Fees - Publicly traded REITs can be purchased through a broker. Generally, you can purchase the common stock, preferred stock, or debt security of a publicly-traded REIT. Brokerage fees will apply. Non-traded REITs are typically sold by a broker or financial adviser. Non-traded REITs generally have high up-front fees. Sales commissions and upfront offering fees usually total approximately 9 to 10 percent of the investment. These costs lower the value of the investment by a significant amount. 

Taxes - When the REIT collects rental income from its properties, at least 90% of those earnings are returned to the investors as dividends. The shareholders of a REIT are responsible for paying taxes on the dividends and any capital gains they receive in connection with their investment in the REIT. Dividends paid by REITs generally are treated as ordinary income and are not entitled to the reduced tax rates on other types of corporate dividends.

REITs provide the option to add real estate to an investment portfolio when it otherwise might not be feasible. Some REITs yield higher profit dividends than other investments, but with reward comes risk. Be extra cautious of non-exchange traded REITs and fraudulent salesmen. You can verify the registration of both publicly traded and non-traded REITs through the Securities and Exchange Commission’s EDGAR system. You can also use EDGAR to review a REIT’s annual and quarterly reports as well as any offering prospectus. Lastly, you should also check out the broker or investment adviser who recommends purchasing a REIT. To learn how to do so, visit the SEC’s Investor.gov page: Working with Brokers and Investment Advisers.

Blog topics:

Let's Talk Money

Let's Talk Money


By Kelly Griese

Wednesday, November 20, 2019

Having “The Talk”
If you’re a parent, seeing the words “the talk” in quotation marks may make you nervous. You probably assume it pertains to a discussion of the birds and the bees. But in this case, “the talk” pertains to an even more taboo topic: money. A quick Google search reveals article after article on how we would rather have an awkward conversation about sex, politics, or religion than delve into the ultra-uncomfortable subject of money. Gary Dayton, a licensed psychologist and head of Peak Psychology in Glastonbury, Connecticut, was quoted in a recent US News report. “To many, money symbolizes comfort and living with ease, but it can also bring up scary issues of dependence, insecurity and even survival,” Dayton said. When you put it that way, it’s no wonder we’re all so afraid to discuss our finances! Money means a lot to us. It can represent status, power, security, stress, weakness, mistakes and more. We judge ourselves and others based on how much money (and debt) everyone has. Right or wrong, it’s common. So how do we broach such a difficult conversation with our loved ones, and why should we? 

Why You Should Talk about Money
Let’s start with the why. Keeping our finances a secret allows for a lot of problems to fester. Think of the room in your house where guests aren’t allowed. It’s where you hide all the junk you don’t want them to see. The rest of the house may look picture perfect for a party, but that’s because you stashed all the clutter in that one room that’s off-limits. You might impress everyone for the time being, but what happens if someone stumbles into the messy room? Rather than hiding your secrets, wouldn’t it be better to fix the problems you’ve shoved out of sight? Purge the room of all that stuff you no longer need or want and give it a good scrubbing. Most importantly, don’t refill the room once you’ve cleaned it! By opening up our whole home for exploration and presenting an honest version of ourselves to the world, we’re motivated to tackle problem areas and maintain them moving forward. Think of your finances in the same way. Hiding money problems from your spouse, children, and parents won’t make those problems go away. They’ll grow to the point of crisis. So make a plan to discuss what’s wrong and work together to improve your financial lives. 

When You Should Talk about Money
The holidays can actually be a great time to discuss finances. On Thanksgiving, it’s common for multiple generations of a family to gather together to celebrate. It’s a time to reflect on all the good things in your life for which you are thankful. And this date sadly can precede a time of excess spending in preparation for Christmas. So before rushing out to shop on Black Friday, take some time to discuss what you can truly afford to spend. Or, perhaps decide as a family to change up the way you have traditionally celebrated Christmas. You could forgo presents all together, arrange a Secret Santa system, or even decide to pool all your money together for a shared adventure that will create wonderful memories. 

How to Start a Conversation about Money
Starting a conversation about money is easier than you think. You don’t have to air all your dirty laundry right away. It’s fine to ease into these talks and gradually discuss more and more difficult things. Here are some conversation starters from the North American Securities Administrators Association (NASAA) that you can use to begin the process. 

Conversations for Couples - Communication is an essential part of a healthy relationship. Your money talk should be an open and honest dialogue with your spouse or significant other about your current financial situation and goals. 


  • How much of our income should go toward fixed expenses (i.e. rent, insurance) versus flexible expenses (i.e. entertainment, savings, investments)?
  • Have we determined our priorities for flexible income and expenses?
  • Do we have similar habits or views on how to manage money?


  • What are our short and long term financial goals?
  • Are we prepared for unexpected financial hardships?
  • Are there ways we could spend less and save more?


  • How much risk are we willing to take with our money?
  • What investments are appropriate at this time in our life?
  • Where can we get help with our financial/investment decisions?
  • How can we select a financial professional (i.e. broker, investment advisor, financial planner) that’s right for us?

For more help discussing financial matters with your significant other, we encourage you to check out our Money Skills for Newlyweds guide

Conversations for Parents and Kids - Help your children build good money habits by talking with them early and often about finances and by setting a good financial example. Educational games and resources for youth can help get your children thinking and talking about personal finance. Use the questions below to jump start a conversation with your child about responsible money management. 


  • What is the difference between a need and a want? Which is more important?
  • How does our family make decisions about spending and saving?
  • Why is it important to balance income (money coming in) with expenses (money going out)?
  • What are ways to earn more money (i.e. babysitting, lawn mowing)?


  • What are some ways to save money?
  • How can interest help make your savings grow?
  • Is there something special you want to save for?
  • What are some ways to save for a long-term goal like buying a car or going to college?


  • What is an investment and how does it work?
  • How can investing make your money grow?
  • What are some of the risks of investing?
  • What are some ways to make investing less risky?
  • Where can you get advice and information about investing?

There’s an argument to be made for parents telling children how much money they make. The New York Times reported on one man’s hands-on budgeting lesson. He withdrew his entire month’s salary in $1 bills, dumped the cash on a table in front of his children, and spent the next few hours explaining where all of that money goes. 

Conversations for Retirees and Senior Citizens - Once you leave the workforce, it’s important to talk with your loved ones about how to ensure that you retain your financial security and independence throughout your retirement. Ask yourself, your partner or your adult children these questions to help you re-evaluate your financial plan in retirement.


  • Are projections for our retirement needs accurate?
  • Will we be able to enjoy the lifestyle we want (i.e. travel or recreational activities)?
  • Have we planned for unforeseen expenses due to inflation and medical expenses?
  • Could we downsize to reduce living expenses?
  • Have we made arrangements for someone to manage our finances if our health should decline?


  • Have we planned for rising health care costs?
  • Does someone we trust have copies of our estate planning documents and accounts information?
  • Do we have an emergency fund for unexpected financial hardships?
  • Who can we seek advice from to leave an inheritance?
  • Do we know all commissions, penalties, taxes and fees for withdrawing or rolling over retirement funds?


  • Who manages our investments and gives us investment advice?
  • Does our mix of investments match the level of risk we want at this stage of life?
  • Do we understand the risk and benefits of financial products promoted to senior investors, such as reverse mortgages, variable annuities or life settlements?
  • Do we know all commissions, penalties, taxes and fees for withdrawing or rolling over our retirement funds?
  • Who will handle our investments if our health starts to decline?

There’s another important conversation to have with aging loved ones. It’s crucial that you discuss fraud. It’s everywhere, and senior citizens are a favorite target. Many people fear this topic, because they think it will upset the seniors in their life. To ease your mind, here are some conversational queues flowing right along with “can you pass the turkey,” to ease into talking about protecting their pockets.

  • Now Versus Then - “Back in my day” and “when I was your age” are two common sayings spoken by aging generations. Most parents and grandparents love to tell stories about how they had to “walk 20 miles, uphill, both ways, in the snow.”  Use this to your advantage. Ask them why and how they interpret things have changed. This is a great way to lead into discussing technology and the evolution of scams.
  • Vet yourself - Remember the first time you typed your own name into Google? You were probably amazed at the amount of information returned through your search.  Be sure to ask your loved ones if they have tried this.  If not, grab a device and do this together. This will help them observe “straight from the horse’s mouth” how much personal information is online and available at one click. Feel free to throw in a “wow, look how easy it is for fraudsters to access this information” or similar comment.
  • Add Credibility - By visiting valid alert websites with your aging loved ones, such as Federal Trade Commission and the IRS, you are able to share valuable information with your loved one without seeming pushy or overly dramatic. These sources also have Facebook and Twitter accounts for followers to receive fraud alerts automatically. Additionally, it can help to watch the news together when reports about fraud are discussed.  Our Indiana MoneyWise website also provides ways to spot fraud and avoid becoming a victim.
  • Talk with them, not at them - Most of us pride ourselves on our independence. Engaging in conversation and open discussion rather than telling your loved ones what to do, goes along way.  Remember your parents and grandparents probably have a contrasting viewpoint on scams and fraud.  Back in the day, they didn’t have to lock their doors, and a handshake sealed the deal.  Although times have changed, the mindset still exists. Their trusting nature, accessibility, and polite manners make them tempting targets for con artists. When talking with them, encourage an attitude of empowerment. Discuss ways they can protect themselves.  By arming them with information, you’ll help your aging loved ones avoid fraud and establish yourself as someone they can come to when problems arise. For more information about aging family members and caregiving visit AgingCare.com.

Blog topics: 
Budgeting, Investing

Bitcoin and Beyond: What Do You Know About Crypto?

Bitcoin and Beyond: What Do You Know About Crypto?


By Kelly Griese

Wednesday, October 30, 2019

Bitcoin This week marks the 11th anniversary of Bitcoin. It’s one of the most talked about brand names in the fintech world, and for many people, it’s as synonymous with cryptocurrency. Think using Coke in place of soda, Kleenex in place of facial tissue, Chapstick in place of lip balm. There are even terms to define this phenomenon: genericized trademark or proprietary eponym. Essentially, the brand name becomes the common name we use to describe all similar products. In the case of Bitcoin, we often use it in place cryptocurrency, even though there are more than 2,900 different cryptocurrencies in existence. 


So what is cryptocurrency anBitcoind how does it apply to investing? 

First, let’s define cryptocurrencies with some help from the North American Securities Administrators Association, or NASAA

“Cryptocurrencies are digital assets created by companies or individuals that take the form of a virtual coin or token. Anyone can create a cryptocurrency. Cryptocurrencies are intangible and exist only on the internet. Central banks and other governmental authorities do not insure or control cryptocurrencies. You cannot always exchange them for other fiat currencies (i.e., currencies declared “legal tender” by governments), such as the U.S. or Canadian dollar or Mexican peso. Cryptocurrencies trade on unregulated, opaque exchanges on which there may be little or no opportunity to independently verify their true market value. And given the newness and uniqueness of cryptocurrencies and related instruments, they do not yet have a clear place in the existing framework of financial regulation.”

BitcoinFor some investors, the decentralized, unregulated nature of cryptocurrencies makes them MORE appealing, and fraudsters agree.

Fraudsters all too eager to exploit investors’ interest in the crypto craze. Here are some common schemes associated with cryptocurrencies: 

Fake digital wallets – A digital wallet is used to store, send, and receive cryptocurrencies. Scammers design a fake digital wallet to lure users into providing their private key or code that enables the wallet to open. Once a scammer receives the private key, he or she can steal all the cryptocurrency from the owner’s digital wallet.

Pump-and-dumps – Groups of individuals coordinate to buy a thinly-traded cryptocurrency, promote the cryptocurrency on social media to push up demand and price, and then sell it in a coordinated sale. The price plummets and those unaware of the scheme are left with the devalued cryptocurrency. 

Multi-level marketing platforms – Companies lure investors through the promise of high interest with low risk. These investors are then incentivized to recruit more members. 

In an effort to combat cryptocurrency scams, the Indiana Securities Division joined forces with NASAA to investigate Initial Coin Offerings (ICOs) and cryptocurrency-related investment products. “Operation Cryptosweep” involves more than 40 NASAA members, including the Indiana Securities Division.  To date, the operation has resulted in more than 330 inquiries and investigations and at least 85 enforcement actions. As part of the the sweep, the Indiana Securities Division filed a cease and desist order against Bionic for registration violations.


Before investing in crypto-related products, here are some common concerns you should consider: 

Volatility - Cryptocurrency markets are highly volatile, making them unsuitable for most investors looking to meet long-term savings or retirement goals. To understand this volatility, just look to the Bitcoin crash of 2018. It was valued at $6,447 on October 31, 2017 before spiking to an all-time high of $19,068 on December 17, 2017 and returning to $6,283 as of October 30, 2018. Other cryptocurrencies experienced similar volatility.

No recourse - Cryptocurrency and many crypto-related investments are subject to minimal regulatory oversight, and there may be no recourse should the cryptocurrency disappear due to a cybersecurity breach or hack.

Untraceable - Cryptocurrency or crypto-related investments only exist on the internet. Issuers can be located anywhere in the world, so it may be impossible to trace and recover lost funds through the courts.

Uninsured - Cryptocurrency accounts are not insured by the Federal Deposit Insurance Corporation, or FDIC. 

Unregulated - Cryptocurrency investors rely upon unregulated exchanges that may lack appropriate internal controls, making them susceptible to fraud, theft and hacking.

Hackable - Creating a digital wallet to store cryptocurrency involves installing software on an investor’s computer. As with any software download, hackers may include malicious code.

Vulnerable - Purchasers of cryptocurrencies rely on the strength of their own computer systems as well as systems provided by third parties to protect purchased cryptocurrencies from theft.

Last year, ahead of the 10th anniversary of Bitcoin, the Securities Division of the Indiana Secretary of State’s office released an investor advisory on the subject of cryptocurrencies. You can read it here.  Additionally, NASAA created a short, animated video to help investors better understand cryptocurrency-related investing and the risks involved. You can view the video here

Blog topics: 
Fraud Prevention

How to Start Investing

How to Start Investing


By Kylee Hale

Wednesday, October 23, 2019

Young adults today face one of the most uncertain economic futures of any generation since the Great Depression. Specifically for us Millennials, born in the 80’s and early 90’s, most of us came of age and entered the workforce during the Great Recession. As a result some of us started careers with lower salaries than desired or not in our preferred field of work. Fuse this with the amount of debt we carry in the form of school loans, and it’s easy to see why some (not all) of us might be nervous about putting our hard earned money into an investment option that carries any degree of risk. Aside from questioning how to begin investing, you may be wondering when to begin. Let's address that first.

If you remember any of the following, you need to be investing for your future:

Oregon Trail when Facebook required a college email address.N*Sync & Limp Bizkit.Total Request LiveBeanie BabiesBlockbuster VideoAIM AOL instant messengerMixed CDsFloppy DisksNETFLIX DVDs VIA MAILDial-up InternetTwilight

Hopefully, you have deduced that you should start investing today. Not investing while time is on your side could make for a difficult road to retirement. But many times, we run away from things that seem challenging or when we don't know where the starting line is. Investing can seem overwhelming and full of uncertain outcomes, yet most of these emotions are built up by myths or fictional roadblocks. Here are the top three myths you need to stop believing about investing and the encouragement you need to get going. 

3 Investing myths you should ignore

Myth 1: I don’t have enough money to start investing.
“The journey of a thousand miles begins with a single step.” - Lao Tsu, Chinese Philosopher

Can you put aside $5 a week? $10 a week? Then congratulations! You have enough money to start investing for your future goals, whether that includes a home, wedding, or more flexible lifestyle. You might be able to find even more to invest by taking a look at your budget. (Don’t have a budget? Check out our free budgeting worksheet and instruction guide here.) You can make this choice effortless with automatic deductions. If you’re paid bi-weekly and have $20 taken out from your paycheck before it hits your bank account, you’ll have over $500 to invest over the course of the year, and you won’t miss it because you won’t see it.

Many brokerage firms and trading platforms offer no minimum deposit required investment options, just be sure to check the commissions or management fees. Many young adults are curious about investing apps, you can check out some guidelines for using smart phone investing apps here. Remember, before placing your money with any broker-dealer, to make sure they are registered by checking the Indiana Securities Portal.

Myth 2: I don’t know enough about investing – I have no idea which stock to pick.
“You don’t need to be a rocket scientist. Investing is not a game where the guy with the 160 IQ beats the guy with 130 IQ.” - Warren Buffett

You don’t have to pick stocks if you don’t feel comfortable researching the financial health and history of individual companies. There are many investment products that enable you to invest in broad sectors of the market for not much cost at all. These products allow you to diversify and spread your risk out over several different companies and economic sectors, rather than putting all your money in one company’s stock. If you need help building a portfolio, you can also enlist the assistance of a robo-adviser or consult a registered financial professional. Many financial planners, investment advisers, and brokers are willing to work with clients who are just starting out on their investing journey and may not have accumulated many investable assets yet. In a way, time is on the financial professional’s side by working with younger clients whose investments will enjoy the benefit of compounding value over time.

Start educating yourself by using Google or check out our Investing 101 page for educational materials on investing. You may also start by researching lower cost financial professionals in your area or who are willing to work with you remotely on your investment goals. For more information, see this overview of the different types of financial professionals.

Myth 3: I’m afraid of losing all my money.
“When you invest, you are buying a day that you don’t have to work.” - Aya Laraya

It's undeniable how scary it was when the US stock market lost half of its value in 2008. However, that’s not the end of the story – by 2012, the market was back on track and trending upward. How many millionaires can you name that became wealthy by investing in savings accounts? The answer to that question is likely, none. While there is always a risk of losing money when investing, leaving your money in a savings account is almost a guarantee that you will lose some of the value of your money to inflation.

Take a look at the data on market performance over the long term (10, 20, and 30 years), while there are fluctuations, in general, the market has trended up over the long term. Don’t get hung up on social media trends or 24-hour news shows. It’s important not to make your investment decisions based on sources that offer dramatized information on the latest market dip or the hottest new IPO. 

I can't say it enough, right now time is on your side, but with each day that passes, it’s a little less on your side.

Through my membership with the North American Securities Administration Association (NASAA), Alerts and Advisories project group, we created NASAA's Millennial Money Mission. For more investor insights and advisories visit NASAA.org

Blog topics: 

Investing via Smartphone Apps

Investing via Smartphone Apps


By Kylee Hale

Wednesday, October 9, 2019

Smartphones offer easy and instant access to apps that can help you navigate the complex world of investing. However, the variety of financial apps offered to investors can be daunting, especially if you are new to investing. This information will help you understand some options when investing via smartphone apps and highlight things to consider before committing to app-based investing.

investing app


Thinking of using a smartphone app for investing?

You may already use smartphone apps to do your banking, make purchases, transfer money to your friends, or find deals on products and services. With so much of your financial life tied to your phone, it makes sense that you might also consider an app (or two) to help you invest. Since investing can help you reach short- and long-term financial goals, there are many things to consider when choosing an investment-focused app.


What kinds of apps are available?

Financial services companies that offer smartphone apps take various approaches to help people invest their money and monitor their portfolios. These apps range in focus and cost. Here are some examples: 
  • Buying and selling investments: Trade stocks, bonds, and other investment products.
  • Turning daily spending into investing: “Round-up” your daily purchases and take the “spare change” to automatically buy investments for a predetermined portfolio.
  • Investing through automatic allocation: Direct a certain percentage of your income to an investment or retirement account.
  • Assigning a portion of spending to invest: Monitor your spending and saving habits and assign a percentage of your overall spending to an investment account.

How can using investing apps be helpful?

Investing is a life-long pursuit that can help you meet your financial goals. If you’re just getting started, an app may help you take more control of your finances or better understand the investing world. For example, if you have trouble making yourself save money to invest, you may favor an app that does it for you. However, once you build a small investment portfolio, you should reevaluate if you still need the app and if there are better options for you. This should become a habit as your needs and expectations change.

How can investing apps be problematic?

Smartphone apps give instant access to trading and portfolio management services, with market access at your fingertips. If you are fairly new to investing, jumping right into trading stocks, bonds, and other complex financial products may not be in your best interest. For example, if you are an emotional person who is swayed by market gyrations, you may end up buying investments at high prices and selling at low prices. Even if you are paying low, or no, trading fees, frequent buying and selling can cost you in the long run. You may also end up with a portfolio that isn’t balanced or diversified. 

Things to think about when using investing apps:

  • Investing on autopilot: Putting an investment portfolio on cruise control may be attractive to people who think investing is difficult and complex. However, if you don’t pay attention to your investments or the services you are using, you may not be happy in the long run. Also, if you use several different apps, you risk over-complicating your finances. 


  • Cyber and data security: Read the terms of service and understand how the company will protect your financial data. With any online application, there’s a risk of being hacked. Check consumer reviews and internet searches for information about any data breach the app may have experienced.  


  • Customer service and access: If you have an issue with your account or the app, you’ll want to be sure that you have access to someone (a live human!) who can help you fix the problem. Be sure you are comfortable with the level of service the app provides, and read customer reviews. 


  • Fees: People are attracted to these types of services because they offer low-fee alternatives to traditional financial service firms. Being fee conscious is good, but a lower fee structure could mean less service and information. Read the fine print to determine what the total fees are for an account. Over time, these add up and impact your overall returns. 


  • Investment offerings: If the app is allocating money to investments for you, understand the investment products and track record of the investment management firm overseeing the products. You want to be comfortable with the types of investments an app is putting you into, the risk you are taking, and the fees being charged. 


What can I do to avoid possible pitfalls of using financial services apps?

Be cautious, do your research and stay engaged.

Don’t use a smartphone app just because a friend suggests it to you. If you are new to investing, you may find yourself using an app that isn’t suitable for your needs or is fraudulent. Technology can make your investing life easier, but you should monitor and check in on your portfolio regularly. Being an informed investor will help you build the skills and knowledge you need to meet your long-term financial goals.

Your takeaway

Technology is rapidly changing the way we invest and manage our finances. When using online services or apps, be sure to use smartphone apps that you understand and fit your financial needs. 

Through my membership with the North American Securities Administration Association (NASAA), Alerts and Advisories project group, we created NASAA's Millennial Money Mission. For more investor insights and advisories visit NASAA.org

Blog topics:
Investing, Fraud Prevnetion

Free Classroom Programming

Free Classroom Programming


By Kelly Griese

Wednesday, October 2, 2019

School is back in session, and the holidays aren’t far away. It’s safe to say teachers are BUSY! And so are our Indiana MoneyWise education coordinators. This time of year, we receive dozens of invitations from Indiana teachers interested in inviting us to their classrooms to speak to students about personal finance and fraud prevention. So in celebration of World Teachers' Day on October 5, we offer you an overview of some of the FREE programming options available to all Indiana teachers. 

Pet $ense Magical Creatures – This is a game that teaches children some of the basics of budgeting using magical creatures from the world of Harry Potter. Children adopt imaginary pets and use an assigned allowance to make purchasing decisions for pet supplies. We throw in an emergency expense, and children will be face with the dilemma of whether they have enough money remaining to afford a class trip to Hogsmeade. 

  • Suggested Time: 15-45 minutes (depending on group size, math skills, and the amount of discussion that takes place)
  • Content: budgeting, credit, debt, emergency expenses
  • Recommended Ages: grade school
  • Ideal Audience Size: any size

Avengers Saving the Day – Connecting with kids using comic books! We use a special edition “Avengers” comic book, created by Marvel Comics in partnership with Visa’s Practical Money Skills to teach children basic financial concepts. Children receive a free piggy bank and comic book (while supplies last). 

  • Suggested Time: 45-60 minutes (more time is needed for larger groups)
  • Content: currency, budgeting, saving, banking, and more!
  • Recommend Ages: grades 2-7
  • Ideal Audience Size: any size

Fraud Fighting Force – Children love escape rooms, and we have created a simulation that uses many of the best parts, such as locks and secret codes. Children are told they have a chance to join a superhero team known as the Fraud Fighting Force, but they must first prove their worth by passing a series of tests. In the process of playing, children learn how to spot the red flags of fraud so they can avoid becoming victims of a financial scam. 

  • Suggested Time: 15-30 minutes (depending on ages and group size)
  • Content: financial fraud prevention
  • Recommended Ages: 5th grade and older
  • Ideal Audience Size: participants should be divided into teams if there is a large audience (4-5 per team)

Financial Football – This is a game that’s available online, but can be fun to play in teams. The fast-paced, interactive game is competitive and helps students learn money management skills. Teams compete to answer finance questions to gain yardage and score touchdowns. 

  • Suggested Time: 45 minutes
  • Content: general financial fitness
  • Recommended Ages: there are three versions, 11-14, 14-18, 18+
  • Ideal Audience Size: 20 or fewer (teams are recommended)

How to Avoid Getting $CAMMED – This $CAMMED presentation is our most popular program. It provides students with the perfect introduction to various types of financial fraud and exploitation. Teens learn about the IRS scam, the grandparent scam, the tech support scam, Ponzi schemes, and identity theft. The presentation includes videos featuring interviews with real criminals and victims. Teenagers learn about methods of persuasion used by fraudsters and are taught how to protect themselves. 

  • Suggested Time: 45-60 minutes (60 is ideal to allow for more questions)
  • Content: fraud and scams
  • Recommended Ages: high school
  • Ideal Audience Size: any size

Adulting 101 – Reality bites! In this presentation, we examine typical “adulting” activities such as budgeting, paying off debt, investing, improving your credit, buying a car, and paying for school. This is a more intensive workshop that is best presented over a course of multiple sessions, or you can pick a few topics for us to cover with your students. 

  • Suggested Time: 3-4 hours total (can be spread over the course of several days)
  • Content: values, goals, budgeting, saving money, investing, credit reports, credit scores, buying a car, paying for school
  • Recommended Ages: high school students (juniors and seniors especially) 
  • Ideal Audience Size: 20-40 students

If you’d like to invite one of our education coordinators to visit your school, please send an email with the following information:

  • Teacher name, email address, and phone number
  • School name and address
  • Proposed dates and times 
  • Student grade level
  • Topics you’d like us to cover
  • Number of class periods you’d like to join

You can email me, Kelly Griese, at kgriese@sos.in.gov. Or you can email my coworker, Kylee Hale, at kyhale@sos.in.gov. All of our programs are customizable to fit your needs, and we are able to bring our own presenting equipment if necessary. And, yes, we really do travel the ENTIRE state of Indiana. All of our programming is available for free for use in classrooms and out-of-school programs. 

Blog topics:
Fraud Prevention, Budgeting

The Truth About October Investing

The Truth About October Investing


By Kylee Hale

Wednesday, September 25, 2019

Is October the month of market crashes? AccoStocks Crash October Effectrding to lnvestopedia.com, the October effect is the theory that stocks tend to decline specifically during this month. This theory is supported by multiple historic market crashes. For example: on October 19, 1987, the Dow fell 22.6%, one of the largest single-day drops in market history. This day has been coined as Black Monday. Other examples include: Thursday, October 24, 1929 (Black Thursday) when the Dow dropped 11% and Tuesday, October 29 (Black Tuesday), which marked the beginning of the Great Depression.  Are these historic crashes anything more than coincidence? What should you look for in October?

-  There’s no evidence that the previous major market crashes were connected. The statistics show more historical down markets have occurred in September than October

-  Previous market slides in the years 1987, 1990, 2001, and 2002 turned around before October was over. 

-  Despite the 1987 plummet, Black Monday has been one of the best buying opportunities of the last 50 years. 

-  The psychological expectation of the October effect combined with skittish investors is a recipe for a self-fulfilling prophecy. Evidence suggests than more often than not, you’ll make money in October. 

-  October may get a bad rap for the significant historic drops, but it’s important to remember that market downfalls don't cluster. As convenient as it would be for all financial collapses to occur in just one month, October is no more susceptible to downfalls than the other 11 months.

-  If October isn’t the worst month, which is? September has more historical down markets and was the instigator for the crash in 1929. 

The stock market is not easy to predict. But one thing you can rely on is that after every crash, the market will eventually go back up. Here are some parting words regarding the October Effect. 

  • Don’t get caught up in worrying over one month, think long term. If you’re investing in the short term, be conservative, lighter on stock investments and only invest what you are willing to lose.
  • If you sell in October, you could be missing out on big gains. December is typically a good month for the market. 
  • Be sure to diversify as past performance doesn’t always indicate future returns.
  • Spread your money around and combine investments in multiple sectors to alleviate risk. 
  • Exploit the fear, if other investors are selling off during October, be sure to look for deals. 

As with all investments, careful vetting and due diligence is a must. Call our office at 1-800-223-8791 or search the Securities Portal to check if both the professional and securities products being offered are registered.

Blog topics:

The Best Way to Save for Higher Education

The Best Way to Save for Higher Education


By Kylee Hale

Wednesday, September 11, 2019

The Best Way to Save for Higher Education 9.11.19 postWhether you’re a parent or you yourself are looking to obtain a degree it's easy to get sticker shock from reviewing education costs. With a price tag that's constantly rising, it may seem impossible to pay upfront or even someday pay off financial aid loans. Future students should apply for scholarships, grants and even consider schools with lower tuition fees. But two things ring true in nearly every situation - it's never too early or too late to start, and a dollar saved now is better than one borrowed later. With this, I want to bring light to the beauty of Indiana’s 529 Plans, which might just be your best friend in paying for higher education.  

Named for Section 529 of the federal tax code, 529 Plans are to post-high school education as 401(k)s and similar options are to retirement. 

Earnings on 529 investments are tax-deferred, and become tax-free when used to pay for qualified higher education expenses.

Indiana offers one of the most generous up-front tax incentives for 529 contributors, Hoosiers can get a 20% credit worth up to $1,000. This credit is available to each taxpayer that contributes, even better, the credit is available to account owners and third­party gift contributors, meaning parents, grandparents and others can all pitch in and reap some of the benefits.

529s are also incredibly flexible. Qualified expenses include tuition, room and board, books, fees or computers at any school that's eligible to receive federal financial aid. Whether your child wants to become a doctor or a skilled tradesperson, 529 savings can be used to help them pursue their goals. But one thing to note, is that 529 savings cannot be used to pay off student loans, so it’s better to save up before and take advantage of the tax benefits. 

Perhaps most importantly, 529 Plans are affordable and easy to use, with a variety of investment options and strategies to meet savers' needs.

Here in Indiana, the CollegeChoice 529 program consists of three different Plans:

CollegeChoice Direct CollegeChoice Advisor CollegeChoice CD
The Direct Plan features quick online account setup and a low minimum contribution of $10. The Year of Enrollment portfolios are set to automatically grow more conservative as a beneficiary gets older. The Advisor Plan offers access to a wider variety of investment options. As with any financial service involving professional assistance, the Advisor Plan comes with slightly higher fees. The CD Plan resembles a traditional bank product in that it offers principal protection. Its streamlined lineup of FDIC-insured options includes one-, two­and three-year fixed rate certificates of deposit (CDs) and a savings account.

All three of these 529 Plans share the same core benefits mentioned above - and all three represent a meaningful investment in a child's future. 

The cost of higher education isn't going to suddenly plummet overnight, but when used properly, 529 Plans can help parents and all students prepare for the significant challenge of financing it.

For more information about the CollegeChoice 529 Direct Savings Plan, call 1.866.485.9415 or visit www.collegechoicedirect.com to obtain a Disclosure Booklet, which includes investment objectives, risks, charges, expenses, and other important information; read and consider it carefully before investing. 

For more information about the CollegeChoice Advisor 529 Savings Plan, contact your financial advisor, call 1.866.485.9413 or visit www.collegechoiceadvisor529.com to obtain a Disclosure Statement, which includes investment objectives, risks, charges, expenses, and other important information; read and consider it carefully before investing. 

For more information about the CollegeChoice CD 529 Savings Plan, call 1.888.913.2885 or visit www.collegechoicecd.com to obtain a Disclosure Statement. The Federal Deposit Insurance Corporation (FDIC) generally insures, with respect to each FDIC-insured institution, deposit accounts that are held in the same right and capacity up to the maximum amount set by federal law, currently $250,000. 


Please Note: before you invest, consider whether your or the beneficiary's home state offers any state tax or other state benefits such as financial aid, scholarship funds, and protection from creditors that are only available for investments in that state's qualified tuition program. You should also consult your financial, tax, or other advisor to learn more about how state-based benefits (or any limitations) would apply to your specific circumstances. You may also wish to contact directly your home state's 529 college savings plan(s), or any other 529 plan, to learn more about those plans' features, benefits, and limitations. Keep in mind that state-based benefits should be one of many appropriately weighted factors to be considered when making an investment decision.

The above is adapted from the Indiana MoneyWise e-magazine March 2018 as written by guest author Troy Montigney. Click here to download a PDF version of the full e-magazine.


Interesting Facts I Bet You Never Knew About Millennial Investors

Interesting Facts I Bet You Never Knew About Millennial Investors


By Kylee Hale

Wednesday, August 28, 2019

The millennial generation has been plagued with the blame of killing almost everything. From napkins and cable TV to the real estate industry. Even though, millennials aren't buying starter homes as soon as they leave the nest these young adults stand out in their saving and investing manners.

DIY Generation

From building a bookshelf to starting a business, millennials are do-it-yourselfers. These adults know that more than likely they will be responsible for saving for their own retirement. More than half, feel that their main source of income during retirement will be from a 401k, IRA or similar savings account, the pension is dead.

Money isn't a Sensitive Subject

Because millennials feel more responsible for their retirement success they are openly discussing money plans with family and friends, well more openly than past generations. According to CNBC, 75% of millennial couples talk about money at least once a week, that's 9% more than Gen X couples and 31% more than baby boomer couples.

Millennials are on F.I.R.E.

F.I.R.E. stands for Financial Independence Retire Early, this is a financial movement defined by frugality, extreme saving and investing. Not all Millennials are living by the guidelines of this focus, however, Transamerica Retirement Survey shows that 58% of Millennials plan to be retired by age 65 or sooner, and while 69% of baby boomers say they expect to work past that age. Not only do millennials expect to retire earlier, but they also expect to live longer, making them the first generation to spend more time in retirement than time spent on the job.

Simplicity is Golden

Some millennials are investing, and they are selecting investments that are easier to understand. Some of the most popular investment vehicles for millennials include index mutual funds, exchange-traded funds and employer 401(k) target-date funds. Millennial investors are more interested in sustainable investing, investing in companies or funds that take into account social and environmental impact. According to Morgan Stanley, millennials are twice as likely, compared to the overall investor population, to invest in companies targeting social and environmental goals, and 90% of millennials say they want sustainable investing as an option in their 401(k) plans.

What's the Verdict?

The millennial generation is coming up short compared to other generations in accumulated emergency funds, participation in employer retirement plans, and they seem to be a bit skittish when urged to invest. But that's not to say they are doomed. Millennials are saving at an earlier age than Gen Xers and baby boomers did and many of the challenges like student loan debt and high housing costs aren't their fault. However, saving more, maxing out the employer's 401(k) match (if available), and dipping their toes in the water of other investments would hedge the millennial's outlook to greater retirement success.

Blog topics:

News and FAQs

Top FAQs