Tired of Treasury bonds that pay nearly nothing, and bank accounts that pay less? Frightened by the vicissitudes of the stock market? We just made an investment with a guaranteed minimum return of six and a half percent. Anyone else interested?
It's not a great return, but it's decent, could go much higher, and essentially risk-free.
Who's with me on this?
Saturday, January 4, 2014 at
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I'll bite. What is it?
Forever stamps. On January 26, domestic first class postage will rise from 46 to 49 cents, or 6.5%. The international forever stamp isn't quite as much of a deal, as international first class postage is only slated to go up 4.5%, but it's still a good return on investment.
Think about it: Stocks go up and down. Bonds go up and down. When have you ever heard of postage rates going anywhere but up? When was the last time your bank paid 4.5% interest? We spent $600 on stamps the other day, and it was tempting to invest a whole lot more.
But how are you planning to sell $600 worth of stamps? Or do you actually use that much postage?
Stamps don't sell well -- you can buy lower denominations at a discount from stamp dealers -- but we'll use that postage easily, Peter. That's why my ROI estimate of 6.5% isn't higher, though I'm pretty sure we'll get at least one more price increase before we run out. We send out lots of Christmas cards, and find that family members, especially grandchildren and those without e-mail, love to get "real" mail. And many of those letters are international, which drives the price up.
I should have remembered. We talked about this! Certainly if your money isn't making more than that elsewhere, you might as well.
We were thinking of stocking up, but not sure about $600 worth... Much better than Discover Bank that just went up to .85%.
Did you buy them online or at your physical post office? I'm not sure our post office has that many stamps on hand.
At our post office. We didn't get as much choice as online (e.g. they were sold out of the Holy Family Christmas stamps -- one of the more beautiful in recent years, I think -- almost as soon as they got them last year. But they even had no trouble coming up with the 200 international forever stamps we wanted.
I thought about buying them online, but the processing fee would have eaten into our profits. :)
Oh, now that's old school. Online processing fee, but free at brick & mortar?
Yep. It's a shipping charge, and not much -- under $2 -- but why not save it if you can? If I decide there's a stamp I particularly want that the local post office doesn't have, I'll probably decide to pay the fee, but I haven't reached that point yet.