The Propeller – Protect Yourself – Freeze your Credit – 8-18-2024

Back in 2001, Warren Buffett gave a talk at the University of Georgia and hit the students with the most Warren Buffett question ever:

“If you could invest in a friend and get 10% of their income for life, who would you choose?”

Classic Buffett, right? But then he flipped the script:

Once the students had their answers, he followed up with this:

• Why would you invest in that person?
• What character traits do they possess?

Now, suddenly, the students had a cheat sheet for success—a list of traits to adopt in their own lives.

But Buffett didn’t stop there. He asked a second question that really got the gears turning:

“If you could short a friend’s earnings—betting against them—who would you pick and why?”

Boom. Now they had a list of traits to avoid like the plague.

But here’s the kicker: this isn’t just about money. You can run this thought experiment with any kind of currency you value.

• Happiness Coin: If you could claim 10% of a friend’s happiness, who would you invest in and why? Who would you short?
• Fitness Coin: Who’s crushing it in the gym and who’s slacking off?
• Friendship Coin: Who’s the best friend you know, and who might be better left on the sidelines?

The brilliance of this exercise lies in its simplicity. It hacks a glitch in life’s video game: humans are often blind to their own flaws, but we’re experts at spotting them in others. If your friend is in a bad relationship, you can figure it out in 10 minutes—something that might take them 10 years to see.

And there’s one key nuance to remember: Buffett insists this exercise has to be based on merit, not luck. It’s not about picking someone because they’ll inherit a fortune; it’s about behavior, character, and choices.

This thought experiment is pure genius—a life hack straight from the Oracle of Omaha himself.

I’ve talked about this many times before – but with the most recent report of over 2.9 Billion Social Security numbers stolen, this is worth repeating.

Freezing your credit is one of the most effective ways to protect yourself from identity theft, especially in light of recent hacks where millions of Social Security numbers were stolen. With this sensitive information in the hands of criminals, your financial security could be at risk, making it easier for thieves to open fraudulent accounts in your name.

A credit freeze prevents anyone from accessing your credit report without your permission, making it nearly impossible for them to open new accounts. Here’s how you can freeze your credit with the three major credit agencies:

1. Experian

• Online: Visit Experian’s Freeze Center.
• Phone: Call 1-888-397-3742.
• Mail: Send your request to Experian Security Freeze, P.O. Box 9554, Allen, TX 75013.

2. TransUnion

• Online: Go to TransUnion’s Freeze Page.
• Phone: Dial 1-888-909-8872.
• Mail: Write to TransUnion Consumer Solutions, P.O. Box 2000, Chester, PA 19016.

3. Equifax

• Online: Access Equifax’s Freeze Service.
• Phone: Call 1-800-349-9960.
• Mail: Send your request to Equifax Security Freeze, P.O. Box 105788, Atlanta, GA 30348.

Each agency will provide you with a PIN or password to manage your freeze, which can be temporarily lifted if you need to apply for credit. Given the rise in data breaches and the theft of Social Security numbers, freezing your credit is a free, simple, and essential step to securing your financial future.

One common financial misstep I observe is over-optimization. People often fixate on details like whether it’s better to contribute to an IRA earlier in the year or later, losing sight of the bigger picture: increasing their income. Don’t fall into the trap of chasing pennies while missing out on dollars.

At its core, personal finance is straightforward:

1. Spend less than you earn.
2. Invest in broad-based index funds or ETFs (like the S&P 500 or Total Stock Market).
3. Automate your financial processes.

Master these fundamentals, and you can confidently enjoy the journey to financial success.  I expound on each of these fundamentals every week in this newsletter, so stay subscribed!

Tech Tip: Use Technology to Stay Healthy

In today’s fast-paced world, staying healthy can be a challenge. Fortunately, technology is here to help! From fitness apps to smart gadgets, here’s how you can use tech to keep your health on track:

1. Track Your Fitness with Wearables
   Wearable devices like Fitbit, Apple Watch, or Garmin are excellent tools for tracking your daily activity. They monitor your steps, heart rate, and even sleep patterns. Set goals and let your device keep you accountable—it’s like having a personal trainer on your wrist.

2. Use Health Apps to Monitor Your Diet
   Nutrition apps like MyFitnessPal or Lose It! make it easier to keep tabs on what you eat. These apps help you track calories, macronutrients, and even water intake. Many also offer meal suggestions and grocery lists tailored to your dietary goals.

3. Stay Active with Virtual Workouts
   With apps like Peloton, Nike Training Club, and YouTube, you can access a wide range of workout classes right from your living room. Whether you’re into yoga, HIIT, or strength training, there’s something for everyone. Plus, many of these platforms offer community features to keep you motivated.

4. Monitor Your Mental Health
   Mental well-being is just as important as physical health. Apps like Headspace, Calm, and Moodfit provide guided meditations, breathing exercises, and mood tracking to help reduce stress and anxiety. Setting aside a few minutes each day for mindfulness can have a big impact on your overall health.

5. Set Reminders for Healthy Habits
   Use your smartphone or smart assistant to set reminders for healthy habits—like drinking water, taking breaks from screen time, or stretching. Simple prompts throughout the day can help you maintain a balanced routine and prevent burnout.

6. Keep Tabs on Your Health Metrics
   Many smartphones now come with built-in health apps, like Apple Health or Google Fit, that aggregate data from all your devices. Regularly check your health metrics, set achievable goals, and adjust your habits based on the insights you gain.

By leveraging technology, you can make healthy living more manageable and enjoyable. From tracking your workouts to monitoring your mental health, these tools can help you stay on top of your well-being, no matter how busy life gets.

Keep in mind, many companies and health insurance plans cover the costs of many of the above 100%.  Be sure to check what your company or health insurance plan offers.