How financial fitness can help you sleep soundly

Coronavirus is causing all sorts of stress but succumbing to scammers on Facebook or borrowing right now to invest will only make it worse. The Barefoot Investor says sorting your finances — and trying a weighted blanket — can help us all sleep more easily in these trying times.

Today I’m going to talk to you about something really weird: investing in sleep.

Here’s the thing: you probably spend, at best, two hours a day in your car, but eight hours a day in the sack … yet you’re likely still sleeping on the equivalent of a Datsun 180B, right?

Honk! Honk!

Seriously, when was the last time you upgraded your ride, Captain Snooze?

Look, I’ve got form on this: in my bestseller I wrote about investing in the Rolls-Royce of pillows, the Dunlopillo, so you could “sleep like a billionaire”. (And yes, I’m the only finance guy who moonlights as a bedroom furnishing adviser. Put that in your pipe and smoke it, Alan Kohler!)

Well, today, I have an update for you.

It all started a few months ago when a friend recommended I try sleeping with a new type of blanket.

“It’s the new thing … they’re called weighted blankets … they weigh, like, 10 kilos … and they’re scientifically proven to release endorphins and help you sleep”, she gushed.

And I thought to myself: “You are crazy.”

Then, a few weeks ago, another friend was raving about hers.

So I went online and found thousands of glowing reviews, and decided to try one myself.

(To be fair there’s also a bunch of pseudoscience written about the benefits of weighted blankets — most of which would even make Paleo Pete blush — which left me very sceptical.)

And so I ordered the cheapest one I could find, fully prepared for it to be the NutriBullet of the bedroom (i.e. destined to end up in the back of a cupboard and eventually thrown out in 2032).

BUT OH MY GOD.

True dinks, the very first night I used it … I slept like it was 2012 (pre-kids, post-marriage).

So how does it work?

Well, it’s pretty simple really: it’s just a standard blanket with 10kg of small beads sewn into it. It weighs you down — but in a good, calming way, and I quickly nod off.

Well, that’s my description (and how it works for me). My father would probably describe it as “sleeping with a hessian bag full of sand on you”. And he’s kind of right: it makes absolutely no sense … but it’s helping me sleep soundly in these trying times, so for me it’s a great investment.

Tread Your Own Path!

READERS WRITE

I’M ANGRY WITH YOU, BAREFOOT

JUSTINE WRITES: Being a Barefooter, I am pretty disappointed with how you treated 22-year-old Tina with her question last week about her boyfriend investing $1000 on her behalf.

You basically ridiculed her. The fact that she took the time to ask for your help speaks volumes, but your reply did not offer one bit of advice on what she should do instead.

Hopefully she has not lost her investment so far and may be able to put it into something better, should you advise her what that might be!

BAREFOOT REPLIES: A recap: Tina wanted to give her boyfriend a grand of her own dough to invest because “he’d made $1500 in 24 hours”.

Yes, I used her question to make a broader point, namely that the stock market has lately become just another place for many young men to gamble.

However, I’m also sure Tina got the message loud and clear that her boyfriend’s day trading would end up in tears — and, Justine, I think that’s valuable advice (heck, I may have even saved their relationship!).

Okay, given the trouble that got me into, let’s double down and deal with another boyfriend question …

The scammers fishing on Facebook may bait their hooks with $100, but their real aim is to reel in thousands of dollars from their victims.

HELP! MY BOYFRIEND IS A SWINGER

BELINDA WRITES: My boyfriend is interested in “swing trading”. He saw it on Facebook.

He says you give them $100 and then you get $1000 back in seven days. I think it is a scam and not a healthy way to manifest income.

However, I have this bias because I hate get-rich-quick schemes. Would you please explain what it is and whether it is worth it.

BAREFOOT REPLIES: I’m with you — it’s a scam.

However, if he’s not going to listen to you then I think it’s worth encouraging him to go through with it.

Think of it this way: your boyfriend will get a real-world, lifelong lesson in greed and stupidity. And all it’s going to cost him is $100? Sounds like a good deal to me.

Just let him know that I think he’ll probably lose a lot more than $100.

Why?

Well, firstly, because he is GIVING MONEY TO A CRIMINAL.

And, secondly, because the scammers fishing on Facebook may bait their hooks with $100, but their real aim is to reel in thousands of dollars from their victims … and they’ll use whatever psychological tricks they can to extract more money.

They may let him nibble on a bit of shrimp, but he’ll end up getting kissed by a shark eventually.

Sounds like a swinging good time, right?

SHOULD I GET A MARGINAL LOAN?

XAVIER WRITES: There is a lot of uncertainty at the moment and share prices (particularly for the banks) are very low. So I thought of getting a marginal loan for $100,000 and dropping an even spread across the Big 4.

It seems a good idea to me, but you warn against it — so is there never a good time to get a marginal loan?

BAREFOOT REPLIES: A “marginal loan” could be very … marginal.

What you mean is a margin loan, where you borrow to buy shares, using your share portfolio as collateral.

But beware. If the shares go down in value, you’ll get a ‘margin call’ from the lender demanding that you put up more money … or they’ll sell your shares from under you, leaving you with potentially large losses.

Granted, in March as the stock market hit its lows, in this column I urged people to keep buying shares (which the Daily Mail ripped off and ran with the headline: “The Barefoot Investor’s warning on why young people should buy shares NOW”).

Since then, the share market has risen significantly, while — in my view — the economic conditions have got much, much worse.

Bottom line? I would not be borrowing to invest in this market. If you do, get ready for some sleepless nights that not even a weighted blanket can help you with.

Most kids learn more by fending for themselves than they do from well-meaning lectures.

TAKE IT FROM THIS MUM, YOUR SON WILL BE OK

JULIET WRITES: You recently wrote about a father who was having problems with his son’s attitude.

Sounds familiar. My youngest did average at school, played at uni for one semester, then sat back on his 10-hour-a-week checkout job. Despite lectures on my part, nothing changed — and I kept bailing him out.

My husband and I wanted a different life, so we sold the big acreage house and bought a beautiful penthouse by the sea. We love it.

My son had to move out, and he was livid for quite a while.

But guess what? He is now 21, has a full-time job, rents a room in a share house, pays his own bills, is paying me back the money he ‘borrowed’, and has plans for his future.

Now he shouts me lunch.

BAREFOOT REPLIES: I actually had a lot of parents write to me this week sharing similar stories.

It taught me a few things:

First, most kids learn more by fending for themselves than they do from well-meaning lectures.

Second, tough love may not feel good at the time (my parents threatened to change the locks after I moved out), but 20 years on they’ll thank you for it.

Finally, as a parent, you’re only ever as happy as your unhappiest kid.

Scott Pape is an independent, community-based financial counsellor. Information and opinions provided in this column are general in nature and have been prepared for educational purposes only. Always seek personal financial advice tailored to your specific needs before making financial and investment decisions.

If you have a money question, go to barefootinvestor.com and #askbarefoot

The Barefoot Investor for Families: The Only Kids’ Money Guide You’ll Ever Need (HarperCollins) RRP $29.99

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Originally published as How financial fitness can help you sleep soundly