All posts filed under: Money

10 Ways to Keep From Retiring in a Cardboard Box

I’ve never had access to a 401(k) plan — I’ve been working full-time freelance since 2006. I’ve always wanted to retire, no matter how anathema that sounds in workaholic America. Maybe it’s because I’ve also lived in countries where people actually look forward to — and many can afford — a labor-free later life: England, France, Mexico and my native Canada. Not coincidentally, fear of medical bankruptcy  — the greatest single destroyer of Americans’ finances — isn’t an issue there either because they offer single-payer government healthcare from cradle to grave, working or not. I’ve been saving hard for years. I’m married, so I do have the advantage of an additional income and shared costs. If I were single, I’d probably sell my home and rent or use a reverse mortgage. As a journalist who’s been covering personal finance for years for outlets like The New York Times, Reuters, Investopedia and others, I’ve learned a lot about the common financial mistakes people make. I’ve also handled my own money for decades, moving out of my …

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How to Have the Money Talk with Your Parents

(Photo credit: Stocksy.com) Even if you began planning for your Golden Years at an early age, there is one thing about retirement that no one ever warns you about: You might be on the hook for some (or all) of your parents’ retirement. How, you may ask? Well, there is a high probability your parentals will outlive their savings. The median household approaching retirement has a nest egg of just $10,000 to $20,000, according to the Government Accountability Office. Among folks who have saved for retirement, the median amount of their savings is about $104,000 for households age 55 to 64 and $148,000 for households age 65 to 74. That’s equivalent to a payout of $310 and $649 per month, respectively. That’s not even accounting for inflation. And you shouldn’t count on Social Security to give Mom and Dad much of a safety net. Social Security coverage is minimal at best – this year, the average monthly benefit is $1,341, which equates to $16,092 for the year. That’s barely enough to stay out of poverty. …

How a Finance Pro Saves for Retirement After Leaving Her Job

As the author of How to be a Financial Grownup, I am the original Financial Grownup. Right after college, I got my Certificate in Financial Planning so I would know enough to ask the right questions. Yeah, I’m that kind of person. I’ve been researching and dishing out advice for as long as I can remember. But now, I needed to give a little advice to myself.  How do I keep investing in a retirement fund after leaving corporate America? This week was the first week in my entire post-college working life that I did not contribute to a retirement fund. I’d recently left my job at Thomson Reuters, a place I’d worked for 16 years as an anchor and personal finance columnist. It was time – I was burned-out to a crisp. I’d run the numbers on what leaving would mean for my new self-employed lifestyle, and things would be fine financially. I had opportunities as part of the release of my book, several paid speaking engagements, offers for freelance writing and anchor/reporter fill-in …

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What No One Tells You About Planning for Retirement

I put at least 10 percent (or is it 15 percent?) of my salary in my 401K every year. I contribute to a ROTH every other year (or so). I own my home — or will in 28 years. I have enough in stocks to carry me at least a few weeks. Financially, I’m not that bad off… am I? I ask this of my financial advisor, whose primary value seems to be telling me that I should save more. Disappointingly, he can’t make magic of what I have put away thus far. We meet annually to review where I would be financially if I were to retire at an age that increases with every meeting. He routinely poses questions that start with “If you plan to ever stop working…” or “If you’re serious…” My current retirement plan seems to be not to retire. But then, as I’ve seen with my parents, retirement can come unplanned and earlier than you think. They did everything right — scrimping and saving, counting their pennies and on their …

How I Lost A Million Dollars: What Pay Equity Really Means

As a longtime journalist, I’ve covered what American society considers to be “women’s issues” for 40 years — including pay inequities, which were big news when I became a reporter in the 1970‘s. Unfortunately for all of us, the gender gap is still making headlines today, because female full-time workers earn only 78 cents for every dollar earned by men. As if that weren’t depressing enough, the United States lags far behind many other nations in achieving wage equality. A new report by the World Economic Forum found that the United States ranks 65th among 142 countries. But we’ve heard about women’s lost wages for so many years that the actual figures take on a numbing familiarity. What they really mean may not fully register until later in life, when it’s too late to do anything about the longterm cost of such penalties. So let me tell you about how I lost a million dollars, how a young woman I know is on her way to losing millions more, and what that may mean for you. When …

I Bank at McDonalds: Confessions of a Personal Finance Writer

People assume that I’m good with money because I write about it. I’m better than most. I’ve managed to keep my housing costs below-market in one of America’s most expensive cities for the past two decades. I dutifully sock away 15 percent of my salary (amplified by that oh-so-nice company match) in a retirement plan. I’ve paid off my loans for grad school as well as a car. But I do make questionable financial decisions. Here are four of my deepest, darkest money secrets. 1. I bank at McDonald’s. I know where every McDonald’s is within a 20-block radius from my office. And it’s not for the Big Macs, Filet-O-Fish or French Fries. While I rarely (maybe one out of every 100 visits) consume any food at Mickey Dees, aside from the occasional black-and-white shake, it’s where I get cold, hard cash. That’s because I bank at a credit union which has limited brick-and-mortar locations. But the credit union’s banking network allows you to use ATMs at any New York City McDonald’s, surcharge-free. If I need …

Ditching the “Sorry” When it Comes to Getting Paid

In the board game “Sorry,” two players cannot occupy the same space at the same time. You roll the dice, and if you land on a space where another player is already standing, they’re knocked back to where they started. Their progress is lost, and you’re left apologizing. “Sorry!” you say — with or without sincerity. Sorry, because I took up space that someone was using. Sorry, because I went and put myself out there, rolled the dice, and got somewhere. Sorry, I got in another person’s way. This game made perfect sense to me as a girl, because I was taught to move through the world in pretty much that same way. It was impolite to take up space, even metaphorically, because somebody else might need it. “I’m sorry,” was the all-purpose reply if I drew too much attention, made too much noise or did anything that might possibly annoy anyone. [pullquote]You’re not greedy if you want to be paid well. And you’re not stealing from the women next to you by speaking up.[/pullquote] …

The Embarrassing and Inventive Ways My Dad Saved Money

Dad was a Depression-era baby. My siblings and I always assumed this was the reason for his notoriously thrifty ways. But now that I’ve  considered it further, I’m beginning to believe that it was a result of both nurture AND nature. I think Dad was actually born cheap. While my family had natural financial ups and downs, Dad continued to live as if we were still in the Depression, no matter how flush with cash we might have been. My family ran a small chain of Hallmark stores. Which was ironic since Dad saw the one-time use of greeting cards a foreign and unnecessary concept (we don’t think he planned to resell them, but no one knows for sure.) Every card we received from Dad, since the opening of the stores in the mid 1970s to his death a few years ago, was signed in pencil. After the occasion, he would erase his sentiments, with the intent to reuse the card. My sister Julie calls him “The Original Repurposer.” Hallmark carried a lot of fun …

Here’s Everything Women Could Buy if They Got Paid the Same as Men

What would happen if the wage gap finally disappeared? We know women would be making more money, but how much more would they be bringing home? By now, you’ve probably heard depressing statistics like this one: For every dollar a man earns, a woman makes 77 cents. You might even be sick of hearing it. But here’s another way of thinking about it: If you add all those pennies up, the gender gap will cost the average American woman more than $400,000 over the course of her professional life. What could that buy? A lot, as it turns out. With that money, a woman could buy a house, put two kids through college, buy more than 21,000 gallons of gas and feed her family for almost seven years. Care about the gender wage gap now? Now that we know how much pay inequity costs women, let’s look at how it affects men. Thanks to the gender gap, life is 33% cheaper for a full-time, year-round male worker than it is for the average woman. In …

Spending on Sunny Days: What My Mother’s Diagnosis Taught Me About Money

Growing up in Pittsburgh during the 1970s, I learned a few things: jobs can go away quickly, chronic unemployment can cause entire towns to wither, and the Steelers, unlike the industry they were named for, were invincible. During those years, steel mills closed one after another, but fortunately my family remained unaffected. My father worked for a nascent Allegheny Airlines, which became USAir, now US American Air (or whatever ultra-patriotic name they’ve now chosen to give it). Still, I remember the beginning of each school year when we’d go around the room and state our names, neighborhoods and other fun facts (like where your father worked). Sadly, the question was never where your mother worked; and for a couple of years, there weren’t many fathers working at all. Given that environment, I grew up with the understanding that money was a limited resource that should be saved, put away for retirement and rainy days. Like, Russell-Crowe-in-an-Ark rainy days.  My parents made it clear early on that my choices for college were to either get a …

What Happened When I Spent One Month Living on Cash

I have long preferred the simple swipe of plastic to handing over warm bills. (Doesn’t everyone?) Paying for things in cash is physically painful. As it should be. When others have asked, my excuse for avoiding cash transactions has been that using a card means it’s trackable, so I can better account for my spending when I leave a digital footprint. But have I actually tracked my spending? Nope. Sure, I like having the option. But if my money were a dog, it’s been off the leash for a while. So last month, I decided to try the cash challenge. I took out $500 at the start of the month for discretionary spending (meaning rent, insurance and other recurring expenses were excluded) and vowed to try not to spend a cent more. I was actually excited about it. At last! Getting real about money. I’ve been dodgy and defensive about my spending for a while. This was going to keep me honest. Mine was a very low-tech approach: I took the wad of cash and …

Is It Ever Ok To Be Foolish with Money?

A regular series wherein we discuss deep topics via instant message. This week Margit Detweiler and Stacy Morrison discuss their “spendy regrets” on a Friday afternoon at 6pm while multi-tasking. So, my friend, how are we defining this thing called “spending foolishly?” I have a hard time with the word foolish. Underneath it all, foolish often means FUN and who doesn’t want that? But yes, I’ve had my spendy regrets. Spendy regrets. Love it. Give me an example. I just made a foolish purchase today. I absolutely could have found a perfectly fine piece of furniture for about 1/10th of what I paid. But I fell in LOVE with an aged-wood credenza. The masterful handiwork! The crossed-iron base! And I have to say, the love I give to that piece, I will get back for decades. So no regrets. So that’s not really foolish then? “If it makes you happy…” to quote Ms. Crow. What are the things you will *always* spend money on? Like for me, it’s a comfortable seat with a great view. On …

Manage Your Money, With Feeling

A few years ago, I dreamed of quiet, tree-lined streets, quality neighborhood public schools, a car, a dog, and a yard. My husband and I had had it with city life, so we began hunting for homes in New Jersey. We must have looked at fifteen homes over the course of a year. But after all that, we decided to move just a few neighborhoods over in Brooklyn, where we could get at least 80% of the things we wanted. (We still don’t have the yard or dog. Some day, perhaps.) I always find it interesting to hear why people make homeownership decisions. Some people do a cost analysis and decide that it may be cheaper to own than rent, or predict that it will be a better long-term investment. Some people buy simply because they like the idea of home ownership and they’ve always imagined themselves as a homeowner. Unlike many other types of financial decisions, such as how much to contribute to a 401(k), owning a home is a deeply personal decision since, …