Skimm Money: Dogecoin, Going Green, and Why Renting Isn't a Waste

Published on: Apr 23, 2021fb-roundtwitter-roundemail-round
DogecoiniStock

Hey. The word of the week is accountability. And the money myth we're busting is that renting is throwing away money. In honor of Financial Literacy Month, we explain below why not buying a home could be smarter for some.

Headlines, Skimm'd
  • Crypto creeps into the mainstream. Venmo now lets users buy, sell, and hold some cryptocurrencies (many of which plunged this morning). Not included in Venmo's update: Dogecoin – a "joke" currency that's gotten a lot of attention. More on that later.

  • An uneven recovery. While some Americans are "revenge spending," the US poverty rate hit a pandemic high of 11.7% last month. It was nearly double that for Black Americans. This inequality is why many are calling the economic recovery "K-shaped."

  • Green light for banks. On Monday, the House approved a bill allowing banks to work with (legit) marijuana companies located wherever it's legal. If passed, the bill would give the cannabis industry more practical banking options (read: not relying mostly on cash). Experts say this is a critical step toward making it a national industry.

Make Good (Money) Choices

If you heard renting is a waste of money...

Know it's not that clear cut. Renting doesn't help you build equity, but there are a lot of homeownership costs (think: interest, taxes, insurance) that don't either. Avoiding those expenses could leave more room to pay off debt and invest – two ways to grow your net worth. Renting also gives you the flexibility to move when you need to. If you sell your home too soon after buying, you could end up spending money you've built in equity on closing costs and capital gains taxes.

If one day to honor Mother Earth wasn't enough...

Get into a green routine. Like only running the dishwasher when it's full. Or unplugging electronics when you're not using them. Good for the planet and your wallet. You can also consider socially responsible investing. As in, buying shares of companies focused on good environmental practices and not in companies with a big carbon footprint. Pro tip: look into mutual funds and exchange-traded funds that let you invest in a lot of pre-vetted, eco-friendly companies at once. 

If you need summer plans for the kids...

See if they can stay in school for free. (Sorry, kids.) Of the almost $130 billion in relief funds set aside for K-12 education, at least $1.2 billion is specifically for summer enrichment programs. And some districts are using their share to provide summer classes for kids who need extra academic help after over a year of pandemic learning. Another option: you can use dependent care FSA funds to cover costs for day camps, nannies or daycare.

Thing to Know

Dogecoin: The cryptocurrency making people say "so wow, much value." You might remember "Doge" as the OG of memes. In 2013, a couple of engineers created a digital coin inspired by the famous Shiba Inu as a joke. Fast forward to 2021: Dogecoin (along with meme stocks and NFTs) got swept up in the recent investing manias. Especially when Elon Musk, Snoop Dogg, and Slim Jim started promoting the crypto. Fans sent the price up 400% in one week and dubbed April 20 "Doge Day" hoping to see the coin hit $1. (It made it to around $0.41 before dropping.) If you buy and sell crypto, remember to set aside a chunk of your earnings for capital gains taxes.

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Skimm'd by: Ivana Pino, Casey Bond, Stacy Rapacon, and Elyse Steinhaus