Wednesday, February 22, 2012

Funding your portfolio... home yogurt making?!

Planning an investment portfolio or demo trading and learning the forex is nice and all but will do little good if one doesn't have any money. From time to time I like to look at different ways to increase the Theoretical Family's cash flow no matter how silly or outlandish it may seem. This brings me to yogurt.

I eat a ton of yogurt weekly. When it comes down to it, yogurt is just cultured milk right? Why then are those little plastic cups of yogurt priced at $14.9 a gallon when a gallon of milk is $3? Perhaps a do-it-yourself investor can become a do-it-yourself yogurt maker. A couple years ago my girlfriend bought me a home yogurt maker. I find it a fun in being creative but does it save money that could be applied to the Model Portfolio?

Home yogurt making is actually incredibly easy.  Heat milk to 175 degrees. Let it cool to 115. Add a pinch of culture (1/32 tsp). Seal the mixture into incubator jars for 10-20 hours.  The machine beeps when its done.
That's it. It isn't rocket science. Keep in mind that people have been making it for thousands of years. I think that conventional wisdom of food handling makes most of us scared to try this.

Health benefits
Have you taken a look at the ingredients on those yogurt cups? Gelatin, high fructose corn syrup, modified corn starch to name a few. They put a ridiculous amount of sugar in those things to cover up the tart from the yogurt.
The ingredients for homemade yogurt is fat free milk and bacteria culture. That's it. Store yogurt only has 1 strain of bacteria. The cultures you can buy have 5. With all the rage of probiotics for health these days you can make healthier and no sugar and fat free yogurt.

Economic benefits
A typical 6 ounce cup of yogurt I see in stores for $0.70
One gallon of milk is $3. A standard 32 ounce quart of milk ends up giving 22 ounces of yogurt. Water is lost from evaporation from boiling and separation during the culturing process.
6 ounces of home made yogurt ends up costing $0.20.  Yes you save $0.50 each one.

Now you do have to buy the $55 machine and that means you have to make 30.38 quarts of yogurt to break even. Up front that may sound like a lot up front but if your family eats 4 of the grocery store cups a week then that's 1 quart a week. Less then a year to break even. If you only do this once every other week then 1 year, 2 months you will break even. Mine has been going nicely for about 2 years now.

I'm going to list this on the funding page as an idea to entertain. 31 weeks from now I'll start counting up $1.81 a week. I doubt I will add that savings into the actual deposits but I think it will show us the power of nickel and diming your way towards a portfolio.

The power here is NOT in a big up front investment. Time works in our favor.

Disclaimer: The investments and trades in my videos and blog entries are not recommendations for others. I am not a financial planner, financial advisor, accountant, or tax adviser. The financial actions I talk about are for my own portfolio and money and only suited for my own risk tolerance, strategy, and ideas. Copying another person's financial moves can lead to large losses. Each person needs to do their due diligence in researching and planning their own actions in the financial markets.


  1. Hey, I had an off topic question for you. Do you own ERF in your sharebuilder account? If you do, will sharebuilder DRIP it? I own ERF as well and just found out today that TradeKing isn't able to DRIP it because its foreign...

  2. For the Model Portfolio I have everything at Sharebuilder, ERF is DRIPping. I am not sure why Tradeking wouldnt drip foreign companies.

    1. I take it all back... I'm not sure how or why but I looked at my account today and TradeKing did DRIP ERF. Which is confusing because I had talked to them about it and they had said it wouldn't work...

  3. Yeah, I was kind of confused as well, but lucky me... I have a sharebuilder account as well!

  4. Slight bit of warning though for foreign companies and sharebuilder. Canada has a tax treaty with the US meaning in some cases the US will give you a tax break if foreign governments tax you. Sharebuilder takes out the tax even in IRAs and the investor has to sort it out later. Most places will but will not have taxes taken out for IRAs.

  5. Is your investing account setup as an IRA?

    1. No its a regular non tax advantaged account. My goal with this portfolio is to retire early when I turn 50. If my money is in an IRA it would be locked away until 59 1/2.

  6. Does Trade KIng allow partial shares or can you only DRIP enough to buy one share. The cash left over stays in your account as cash.

    I am from Canada.