Tag: retirement (Page 1 of 2)

It's Time to Face Your Financial Reality

It’s Time to Face Your Financial Reality

Last week, in celebration of Halloween, I shared a tweetstorm of the scariest things you could say to a Personal Finance Geek. Maybe you read that and felt bad about yourself because you have done some of those things (or still do). DON’T. I shared the original tweets. What I did not share were all of the conversations that followed. SEVERAL of these tweets inspired responses from other personal finance bloggers that said things like “Me 2 years ago,” “…said my husband,” “been there!” or “still paying off that debt!”

We are not better than you. And you are not worse.

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retire now

The State of Retirement in the U.S. in 2016

It’s sad.

<End of post.>

Alright, alright. I’ll get into details if I must. First, the good news:

According to the 2016 Retirement Confidence Survey published by the Employee Benefit Research Institute, people are starting to move out of their recession fears. The percentage of workers “very confident” in having enough to retire, went up from 13% in 2013 to 22% in 2015. This year it went down slightly to 21%, but overall, people are feeling a bit more confident in these insane market days.

The question is: Should they feel this confident?

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Saving a Million Dollars is Easy!

Saving a Million Dollars is Easy!

Do you know what my favorite posts to read are? The ones about how saving a million dollars is totally easy! And guess what? There are THOUSANDS! I decided to aggregate a few of my favorites to drive the point home. Saving a million dollars over a long period of time is actually very simple!

Young Adult Money provided a simple calculation for only $500/month: With a “beginning balance of $5,000. If you contribute $500 [a month] over 40 years with a 6% return, you’ll end up with $1,055,511.36.”

Interest rates matter quite a bit when it comes to saving money. This Business Insider chart gives you a daily savings need based on 3 different return rates to save $1,000,000 by 65!

Saving $1000000

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Don't be a retirement newsletter poster child

Don’t be a Retirement Newsletter Poster Child

Periodically, the company that runs the retirement funds at Mr. T’s employer sends out a retirement newsletter. This is the standard single-fold document that tells you to save more money, think about your future, and think about your taxes.

Here’s the Problem:

I read this newsletter religiously (mail about saving more money!? Yes!). It’s terrible. One of my earliest posts rewrote one of Mr. T’s newsletter scenarios because I think someone should jazz this stuff up!

This past newsletter threw in some more horrible stories. I’m changing the names (so I don’t offend the real fictional dummies), but everything else is the same. I’m not making this up!:

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One Change

The Impact of Making Just One Change

A few months before we dove into purging our stuff, Mr. T got new socks. I was reading The Lifechanging Magic of Tidying Up to prepare for the big event. I was just reading the socks section when Mr. T was unpacking his new socks. “This book says you should roll your socks to let them rest.” Probably more to get to me to stop talking about the book, Mr. T dutifully rolled all of his socks. For two months, those perfectly sushi-rolled socks taunted me. They actually seemed happy. Socks. Happy. Crazy? Right? I wanted our whole house to feel that way. Every time I saw his socks, I wanted more! I wanted to dive right in and make it all better.

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How Parents and Significant Others Impact Student Finances

On Monday, we discussed how people are sometimes dumb with money and love, but it’s not all bad news. Today, we highlight research that shows love can positively influence our finances. The first study, published in December 2015, followed 693 University of Arizona students. The (mostly white, female) students were extensively surveyed toward the beginning of college (ages 18-21) and then again toward the end (ages 21-24). The 693 study participants were all included because they reported being in a serious, committed relationship at the second survey. The study was trying to figure out the impact parents and romantic partners have on the financial behaviors and attitudes of college students.

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Recalculating: A New Financial Plan

Welcome to the culmination of a week of numbers! On Monday, we took a look at the historic spending of the Banks family and emerged with an ideal early retirement budget of $51,300 with an after-kids budget of $47,000. Remember that these numbers are all based on maintaining our current lifestyle in our current home in Alaska. Moving will most likely decrease those needs, but since we have data about what we currently spend, we’ll build projections based on the life we currently live.

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Are You a Saver or a Spender? The Why.

I had an interesting conversation with Penny last week. It went something like this:

  • Penny: McKinley is a saver. I’m a spender.
  • Me: What makes McKinley a saver and you a spender?
  • Penny: McKinley just saves all of his money. I buy things. Like my waterproof camera. Well, I guess I’m more of a saver, then a spender.
  • Me: What’s the point of McKinley saving his money? What is he going to do with it?
  • Penny: I don’t know. He just keeps it.
  • Me: Dad and I are savers. But do you know why we save money?
  • Penny: So we can go on vacations and dad doesn’t have to work until he’s old.
  • Me: Right. Money isn’t worth anything if it doesn’t have a purpose.

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Why the YMOYL Wall Chart is the Best Retirement Tool

The book, Your Money or Your Life is said to have introduced the term “Financial Independence” and offers a very specific road map for achieving it. I strongly advocate every person read this book. A large part of the program involves creating a chart. Let’s start with how to create your own chart and then talk about why it’s the greatest thing since sliced bread. In Excel,* or on graph paper on the wall (I will argue for doing both momentarily), start tracking in a point-to-point or line graph form the following numbers:

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The Two Things Keeping You From Retirement

The biggest financial finish line in the majority of people’s lives is retirement. Researchers have poured years into studying how to get people to actually take the steps to prepare for retirement because not enough people are doing so. The definition of retirement is to leave one’s job and cease working. Quitting work is the easy part of retirement. The hard part is being financially prepared to no longer have paychecks coming. Everyone is looking for a magic bullet to retirement—the as-seen-on-TV pill for becoming rich. People want to win the lottery or inherit large amounts of unexpected money because otherwise, they just don’t know how they will ever have enough money to retire.

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