My personal finance stack 💳
Several friends have asked me about my personal finance “stack.” Analogous to sharing the tech stack behind a product, here’s the stack of banks and Fintech startups behind my financial life:
Credit cards: Chase Sapphire Preferred and Chase Freedom
For security, convenience, and rewards point reasons, I favor using credit and avoiding cash / debit transactions wherever possible. Accordingly, I spent a decent bit of time researching and fine-tuning this component of the stack.
The CSP card offers AmEx-like warranty, travel, and rental car protection for purchases made on the card. Paired with no foreign transaction fees, its VISA signature status, and a sign-up bonus with a cash value of $400, it’s one of the best cards out there at the moment.
Both the CSP and Freedom cards feed points back to Chase’s Ultimate Rewards program, one of the most flexible in the industry (you can transfer points 1:1 to other airline reward programs like United Mileage Plus and redeem them directly).
Of note, the Ultimate Rewards program also currently offers a 2:1 redemption bonus for travel booked through their portal, but I’ve found it clunky and poor-performing in its ability to return the most cost-efficient result for flight / hotel bookings.
Checking and savings accounts: Capital One 360 (online)
Capital One 360 is one of the sharpest 100% online banking operations around. They’re completely full-service: checking, savings, and traditional financial instruments like CDs (if you’re into that kind of thing).
My experience with them has been flawless, they refer to their customers as “Savers,” and seem quite committed to innovation / millennials. Their acquisition of Level Money & team earlier this year has already led to some nice improvements to their mobile banking app / strategy.
It’s worth noting that I’ve also heard good things about Capital One 360’s most direct competitor, Ally bank (mostly through mentions of their savings account APR in r/PF).
Before opening an account with Capital One 360, I began the process of opening a savings account with Ally, but they asked me to call into a support line to further verify my identity (I wasn’t given the option to do this via a Lexis-Nexis style, “You may have received a student loan in 2009, who is the servicer of this loan?” question). I generally have no qualms against calling in for this sort of thing, but I next went to Capital One’s website and they created an account for me without this step at midnight on a Saturday, thereby winning out by avoiding a “call during EST business hours” interaction.
Retirement (401k and IRA’s) & non-tax advantaged investment accounts: Vanguard
A love letter to Vanguard will be birthed from this blog at some point, but for now I’ll simply share that all my investment accounts are held under the Vanguard umbrella.
Market-tracking index funds + low-cost ETFs aren’t the right choice for everyone, and I’ve got several friends who spent time on Wall Street that deviate from this strategy in the pursuit of more aggressive returns, but I greatly enjoy the stress-free strategy and dirt cheap ERs that their funds provide.
They also have a pretty interesting offering allowing for the simple creation of charitable foundations that I plan to use later on in life. (jlcollinsnh has an interesting post covering this specific offering).
Credit score tracking: Credit Karma
Credit Karma is the leader in truly free credit score monitoring. Full stop. If you haven’t yet signed up, I encourage you to go check it out asap.
I also take advantage of the free annual credit reports available from each of the three major credit bureaus. I space these out throughout the year and while they don’t provide a credit score, they provide peace of mind in ensuring that no unauthorized lines of credit have been opened in my name since last check (which should be pretty tough to do).
It’s worth nothing that neither Credit Karma nor the government-mandated free credit reports are generally accepted by landlords as part of the rental application process. For that situation, you’ll need to pony up the cash to grab an official, score-based report directly from one of the three credit bureaus.
Last time I had to do this, I used the $1 promotion from TransUnion. Canceling the associated credit monitoring service before the end of the 7-day trial period required going through a five-step rejection-of-service process over the phone with a (friendly) customer service rep, but it wasn’t the worst and saved a bit compared to buying it outright.
Net worth tracking: Personal Capital
I’ve been using Personal Capital’s account aggregation and net worth tracking tools since the end of last year when I moved away from Mint (more details on this move in a future post).
Their focus on net worth (v.s. budgeting) is refreshing and they offer several other tools, including an impressive retirement planner, that are useful / entertaining to play with.
The service is free, but they will call you as you approach ~$100k in investments to pitch you on their pricey (.89%) investment management services. A bit intrusive, but they’re very friendly in accepting a decline to their offer.
Other components, used infrequently:
Bitcoin Wallet: Coinbase
2018 update: I no longer own any bitcoin (or any other cryptocurrencies). If I did, I would be using a hardware wallet (like a TREZOR) and not using a web wallet like Coinbase.
I own an insignificant amount of Bitcoin (<1% of my net worth). Coinbase is the only place that I’ve ever purchased BTC and I really love the platform that they’re building out.
They’re also incredibly security-focused as a company. Measures like mandatory 2FA for all accounts and cold / offline storage inspire lots of trust in their ability to scale as the leader in the space.
Alternative online purchase method: Paypal
Legacy credit cards:
- Bank of America
- Shell Gas card (authorized user)
For credit score reasons, I keep open a couple legacy credit cards. My current credit score is very thankful for my dad adding me as an authorized user when I was in high school (and for picking up the gas bill!).
Note: If I had been asked to detail my personal finance stack at any given time over the past few years, there’s a good chance it might have looked a bit different. Here’s a list of former components of my stack and why I’ve moved away from them:
Simple - Generally good, but several service interruptions + complete outages caused me to lose trust in them handling my money.
Acorns - Tried this out for a few weeks and dropped for costs reasons / slow transfer times (7-10 day withdrawal times as equities need to be sold, etc.).
Robinhood - Put $100 in here to try it out. Decent experience, but dropped as I don’t generally invest in individual stocks and spent too much time looking at the app throughout the day.
Mint - Too many ads / suggested offers; few meaningful product improvements over past several years since their acquisition.
Bank of America checking and savings accounts - These were legacy accounts from my younger days — dropped because of their high fees.