Glencore to shed jobs in Australia

MINING giant Glencore plans to shed up to 535 jobs at its Australian operations after announcing it will cut its global zinc production by a third.

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This Famous Mother of 2 Wants to Send You a Free Box of Diapers

You’ve probably heard of Jessica Alba – the superstar actress from Fantastic Four and Dark Angel.

Did you know she’s also the founder of a billion-dollar sustainable products company? Oh, and a mother of two young daughters, in case you didn’t think she was working hard enough.

Enter The Honest Company

Alba’s daughters – 7-year-old Honor and 4-year-old Haven – are actually the inspiration for her entrepreneurship.

“It’s the most satisfying job in the world,” says Alba about being a mom. “But, it can also be overwhelming and confusing. I created The Honest Company to help moms and to give all children a better, safer start.”

The company provides safe, sustainable products for families. From diapers to cleaners to makeup, the company wants to eliminate as many of what co-founder Christopher Gavigan calls “toxic risks” from everyday household products.

Parents like Alba and Gavigan, a father of three, are becoming increasingly aware of potential toxins in disposable diapers and other common products, and the risks they could pose to children.

From their own experiences and frustrations as parents, the pair came up with an ideal for families: safe, eco-friendly, beautiful, convenient and affordable products.

Everyone should have access to this ideal, they believed. So they created it.

Fast forward a few years and it’s now a BILLION dollar company. How inspiring, right?

How to Get Free Diapers and Wipes

What’s even cooler is that Jessica Alba’s company is now sending how free box of diapers to moms and dads all over the country.

Use this link to sign up for a free trial, and The Honest Company will send you seven of their premium diapers and 10 baby wipes totally free.

Other Products for the Family

The Honest Company is more than just diapers.

According to Gavigan, “Many [parents] are still completely unaware of the toxic risks posed by everyday basics, like diapers, home cleaners, body washes, and laundry soaps. Yet, there’s growing consensus that some chemicals used in these products are linked to chronic diseases like asthma, ADHD and even cancer.”

In addition to baby products like diapers, wipes and formula, The Honest Company offers non-toxic personal care and home cleaning products, which you can get at a discount through their Essentials Bundle.

You can also get whole-food based supplements for kids and adults through the Health and Wellness Bundle.

Click here to grab your free samples.

Good luck Penny Hoarders!

 

The post This Famous Mother of 2 Wants to Send You a Free Box of Diapers appeared first on The Penny Hoarder.

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How did the Islamic State get its Toyotas?

HOW did Islamic State get its massive fleet of Toyotas when the car company stopped sending its vehicles to Syria years ago?

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$7 million ‘a drop in the ocean’

A LAWYER for the mastermind behind Australia’s worst insider trading scam says his jail term should be cut because his profit was relatively small.

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How Apple could come unstuck

IT’S the biggest brand in the world by far. But what goes up must surely come down. So how will gravity catch up with Apple?

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VW boss sorry but says scandal not his fault

VOLKSWAGEN’S top US executive offered deep apologies yet sought to distance himself from the emissions scandal enveloping the world’s largest automaker.

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Should You Share Your Credit Score on the First Date?

Couples with large gaps in their credit scores are more likely to separate later on, according to a new study.

While most first dates center on polite discussion over coffee, drinks, or dinner, serious romantic prospects might consider asking for their date’s credit score right off the bat.

That’s because a growing body of research indicates that some (potentially awkward) financial conversations – including those about credit history – can offer crucial clues about the length and quality of a romantic partnership. So if you’re looking for a relationship with staying power, why beat around the bush?

According to an ongoing paper from the Federal Reserve Board, people with drastically different credit scores may experience more financial stress down the line — which places a major burden on a relationship. In fact, the paper concludes “couples with larger [credit] score gaps at the beginning of their relationship are more likely to subsequently separate.”

That’s right: People with dissimilar credit scores are more likely to break up – at least eventually.

And that’s not all. The study, which analyzed 12 million randomly selected consumer credit profiles, also showed that people with higher credit scores are more likely to form committed relationships in the first place.

Further, the paper asserts that credit scores are much more than a three-digit number representing our credit health; in fact, they may represent our level of responsibility as human beings and romantic partners. The authors even say their findings suggest that a person’s credit score can “reveal their relationship skill and level of commitment.”

Men and Women Are Already Wary of Bad Credit Matches

Spoiler alert: It appears men and women already knew this somehow – at least on an instinctual level. According to a 2013 study from FreeCreditReport.com, men and women were already ranking financial responsibility on par with physical attractiveness and sexual compatibility when it came to choosing a potential mate.

A full 75% of female survey respondents also admitted to taking credit scores into account when vetting a new relationship that year, along with 57% of men. And a majority of male and female respondents worried a partner’s poor credit score could affect their own finances adversely – with 68% worrying it would prevent them from buying a house, 53% worrying about managing joint accounts, 52% stressed over getting the best interest rates, and 42% worrying bad credit could ruin their chance at a car loan.

A full 25% of respondents were also willing to pull the plug on a partner with poor credit before marriage – simply because they didn’t want to be held back by someone’s poor decisions or credit history.

Poor Credit = Bad Money Management = Arguments

That may sound drastic, but perhaps it’s not a bad prescription for avoiding future marital trouble. After all, a relationship with money problems from the get-go may not last long, and has a good chance of making everyone miserable during its short lifespan.

Recent research from Kansas State University professor Sonya Britt concluded that money issues are the crux of the problem during many divorce proceedings. And when things are all about money, it can get ugly quick.

“Arguments about money is by far the top predictor of divorce,” noted Britt, assistant professor of family studies and human services and program director of personal financial planning, in a press release. “It’s not children, sex, in-laws or anything else. It’s money — for both men and women.”

After studying data from 4,500 couples surveyed as part of the National Survey of Families and Households in 2013, Britt also concluded that money arguments are some of the hardest to recover from for most couples – and that financial arguments lead to decreased relationship satisfaction over time.

Britt’s findings seem to echo those from the Federal Reserve Board in suggesting that couples who are financially incompatible from the beginning have a harder climb ahead.

“You can measure people’s money arguments when they are very first married,” Britt said. “It doesn’t matter how long ago it was, but when they were first together and already arguing about money, there is a good chance they are going to have poor relationship satisfaction.”

This just goes to show that red flags like poor credit should be heeded and treated with care. And for couples who may not be on the same page, Britt suggests seeing a financial planner as part of premarital counseling.

Should You Ask Your Date About Their Credit?

While you may feel weird discussing credit scores early on in a relationship, it appears that knowing someone’s credit profile and their sense of financial responsibility could save you both some time – and potential heartache — in the long run. So come right out with it if you’re willing. At the very least, you’ll get an idea of where you stand.

In a perfect world, your preferred romantic partner will be an ideal financial match as well. But in the real world, a good looker with bad credit might spell financial disaster and a rocky relationship ahead. Either way, it can pay off to know what you’re dealing with ahead of time.

There may be nothing less romantic than swapping credit scores on a first date. But hey, at least you’ll have something to talk about.

Did you share your credit score early in your relationship? Would you date someone with poor credit?

Related Articles:

• Why Your Spouse Is Your Most Important Money Decision
• Joint Finances: Why I Share My Money With My Husband
• Eight Things to Think About Before You Get Married

The post Should You Share Your Credit Score on the First Date? appeared first on The Simple Dollar.

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This Retirement Plan Is Creepy and Illegal, But It Just Might Work…

If your piggy bank breaks, your IRA investment tanks, or you simply fail to save for retirement, there’s still one option left: Bet on your longevity.

An old-timey retirement scheme called the tontine might be coming back into style. While this once-hip model for funding your future was largely shunned at the advent of modern insurance companies, some experts claim tontines could again be a viable option for retirement planning.

But first, a quick look at how this crazy scheme works.

It’s sort of like the ultimate form of schadenfreude: You make an investment. A bunch of other people make the same investment, and as the investment grows, you all get paid on a regular basis.

But as people in the group die, the pot grows — meaning if you outlive your investment partners, you’re going to end up with more money.

It’s that easy. All you have to do is wait for everyone else to die.

Your Middle-Ages Retirement Plan

The practice dates back to the Middle Ages, when governments would seek investments from their citizens to fund wars. Tontines worked like a juiced-up version of an annuity, where a loan is paid back in increasing amounts each year until your death.

“It was the ultimate lottery. If you died, you lost everything in a tontine,” Jeff Guo writes in the Washington Post’s illuminating history of the practice. “But if you were the last person standing, you stood to collect huge annual payments.”

Remember, it was the Middle Ages. You were lucky if you made it to 40.

The American tontine model reached its peak around 1900, and is often thought to be the predecessor to modern insurance policies. But many of these plans were corrupt.

“There was rampant shadiness back in the day,” Guo notes. Tontines got lumped in with the sins of gambling, and states started to outlaw them, starting with New York in 1906.

Return of the Tontine?

Some academics are campaigning for the tontine’s return as a viable retirement option. In theory, it would be most ideal for people without children or others they would want their money to go to when they died.

If you bought into a tontine and were one of the first to fall to the Grim Reaper, your money would at least be going to the other people in your tontine, to make their retirement more comfortable. The money from that annuity insurance policy wouldn’t be lost to the insurance company.

A tontine model could also work to replace today’s pensions.

“Instead of setting aside so much money to make sure all the pensions are fully funded, why not let the pension payouts vary?” Guo writes.

“If people are dying faster than anticipated, redistribute their shares so that the remaining pensioners get slightly larger checks. If people are dying slower than anticipated, shrink those pension checks a bit.”

With an aging population that’s living longer than ever before, it’s definitely time to start thinking about alternatives to typical retirement options.

Moshe Milevsky, finance professor and author of King William’s Tontine: Why The Retirement Annuity of the Future Should Resemble Its Past, told MarketWatch earlier this year that the ideal tontine scenario would require “approximately 500 investors in a ‘village’ around the age of retirement banding together” with the aid of an impartial advisor.

Milevsky has been working on selling people on the tontine idea for a while. In one 2014 interview, he likened alternative retirement plans like tontines to a new normal:

“You used go to work and get a cubicle, a couple days of vacation, a chair and a pension. Today it’s not like that. Now saving for retirement is like saying you have to bring your own chair to work. It’s a new reality, and today you have to manage your retirement yourself.”

Fraught with indecision, I took to Twitter to ask Washington Post reporter Jeff Guo, unofficial tontine historian, if he would choose a tontine as a means of retirement cash. After all, I’m sure he’s spent more time considering this method than I have. His response:

@Lisatella @thepennyhoarder I dunno! A large, transparent tontine that approximates a low-cost annuity would be tempting…

— Jeff Guo (@_jeffguo) October 7, 2015

Before You Sign up for a Tontine, Check out Family Pools

For many, the Hollywood trope of a tontine that turns into a murder spree is going to be the thing that sticks in your mind — something The Daily Show pointed out in 2011.

But let’s be real: In a post-modern tontine aided by technology, you’re unlikely to know your investment group, therefore preserving yourself from the low threat of investment-fueled murder. It’s just the idea that’s creepy.

The simple idea of hedging a bet on your life over someone else’s is the exact opposite of a family pool, where a community agrees to contribute a certain sum each week or month, with one party in the pool receiving the entire pot on a rotating basis.

It’s not meant for retirement, but more designed for saving for large purchases with a supportive group.

This form of community saving ensures that everyone is taken care of equally over time. You know everyone involved, so if someone in the group were to die, you’d probably give that person’s share back to their family.

But who knows — maybe some combination of family pools and tontines will be the new, new normal by the time I’m ready to retire.

Your turn: Would you sign up for a tontine?

Disclosure: We have a serious Taco Bell addiction around here. The affiliate links in this post help us order off the dollar menu. Thanks for your support!

Lisa Rowan is a writer, editor, and podcaster living in Baltimore.

The post This Retirement Plan Is Creepy and Illegal, But It Just Might Work… appeared first on The Penny Hoarder.

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Is It Finally Time to Get Rid of Your Landline?

There are pros and cons to cutting the cord.

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Being a Pro Athlete Made Me a Terrible Investor

More than half of former NBA players are broke within five years of retirement, according to a Sports Illustrated estimate. Photo: Eric Wong

After much thought and deliberation, I’ve developed a theory on why such a staggering amount of NFL and NBA players go broke shortly after retiring.

The main culprit will always be that they failed to live within their means. Supporting dozens of family members and buying multiple luxury cars has never helped anyone’s financial situation.

But, after examining my own financial struggles during and after my professional basketball career, I have another theory as to why ex-athletes are going broke left and right: The confidence needed to become a pro athlete makes you feel invincible in the investing world. The results of this hubris are disastrous.

First, some background. I played for three seasons in Israel’s professional basketball league. I was earning a decent salary, but we’re talking schoolteacher decent (around $35,000 plus bonuses), not NBA player decent (minimum salary $507,000). Still, my situation was not all that different from your typical NBA rookie.

Like most young people, I left college with minimal financial knowledge. I had never owned a credit card and I had never opened a bank account without my mom or dad holding my hand.

Plus, I went to a college where everyone ate cafeteria food for four years. I didn’t even know how to cook an egg.

Making matters worse was the fact that my college studies left me woefully unprepared for the real world. Instead of learning useful information on personal finance, I took courses in which I was literally graded on how well I could read Sarati. Never heard of Sarati? That’s probably because it’s an Elvish language JRR Tolkien made up for the “Lord of the Rings.” I’m not kidding.

To say my education was impractical would be an understatement.

Upon graduating, I shipped off to a new city and earned my first real paycheck, with very little in the way of real-world money skills. This is a situation familiar to most pro athletes. They are on their own with a pocketful of money and very few responsibilities.

That’s where many people can have a very dangerous thought: “I’m really good at what I do. I mean, I’m good at pretty much everything. I’ve got all this money sitting around. I should just make more of it.”

In almost all their cases, “make more of it” does not mean “invest in low-cost index funds.” It means thinking you’re smart enough to start a new businesses without doing the research or, in my case, to beat the stock market.

Even though investing in the market was a mysterious netherworld, I figured I’d be able to make money. After all, how hard could it be? I understood there’d be a learning curve, but I also felt like I was special. I was better. I knew how to outwork and outcompete everyone around me.

That’s the psychology of being a pro athlete, and it’s dangerous. Knowing how to shoot a three-pointer does not help you understand the risks involved with investing. Whether it’s putting a little bit of money in the market or pouring $300,000 into a Hard Rock Cafe knock-off like Rocket Ismail did, the point is the same: Being good at sports does not make you good at everything.

As obvious of a sentiment as that is to most people, it’s hard for professional athletes to grasp.

In order to get to the level these guys are at, you have to have a certain mindset your whole life. You have to believe that you are the best player on the court at all times. You have to believe as a high schooler you will be one of the 3.4% of people who will play in college, and then once in college you have to have no doubt you’ll be one of the 1.2% drafted into the NBA (it’s a higher percentage that go overseas like I did, but it’s still incredibly difficult to sign a pro contract).

Once you get to the top of the ziggurat, you feel invincible. In my case, that meant investing in individual stocks with the confidence of Carl Icahn. It was going to be a breeze.

And it was, for a while. I happened to start investing right around the bottom of the market in 2009. By 2011, I was riding high. It was almost too easy. Why wasn’t everyone invested in Apple? They were printing money. I was going to be so rich.

Then, the market tumbled. I was faced with my first real adversity. I envisioned this happening when I started out. I knew the market had ups and downs. I figured I’d just find all the smart investments and make money while everyone else was losing. I’d made clutch free throws with one second on the clock and thousands of fans screaming at me. You think I was about to be scared by a dip in the market?

Oh my goodness, I was so scared. I abandoned all my plans. I had no tricks up my sleeve. I ditched every single one of my stocks. I couldn’t handle logging into my account and seeing my net worth plummet like a stone. I couldn’t sleep until I knew my cash was safe in my bank. Or better yet, under my mattress. Yes, no one can reach it there.

It was an all hands on deck, DEFCON 1, retreat with a capital “R”.

Due to this behavior, I lost a lot of money. The market rebounded and I didn’t participate in any of the upside. Had I not panicked, I would have been fine. But, my deadly combo of overconfidence and inexperience got the best of me.

I finally had to accept the fact that there were millions of people who knew the market better than I did. These people were happy to take my money. It was tough, but I put aside my ego and decided that I wasn’t going to be able to beat the market. I now invest in index funds and I don’t check my account very often. If I had done the same in 2009, or better yet if I’d used a low-cost, incredibly easy-­to-­use online financial advisor such as Betterment, I would be much wealthier today.

This lesson applies not just to pro athletes, but to anyone out there who is great at what they do. Use your talents to make money, but don’t venture too far outside your area of expertise with reckless confidence.

As for me, until the time when fluency in Sarati and the ability to dribble two basketballs with my eyes closed gives me an edge in the markets, I’ll happily let the real pros help me out.

The post Being a Pro Athlete Made Me a Terrible Investor appeared first on The Simple Dollar.

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7 Things Fund Managers Ask Company Managers

If management isn't addressing these points, fund managers will be inclined to sell their shares.

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Is an Open House Still a Must-Do Step When Selling Your Home?

Some real estate agents view this home-selling staple as a valuable tool, but others believe it has lost its effectiveness.

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Don’t Let These 5 New Workplace Trends Ruin Your Day

Is your office becoming a downright miserable place to work?

You may love your job, your co-workers and your boss, but subtler issues can make for an unpleasant work environment. These five workplace trends could be making your workday harder, reports US News & World Report.

If these trends are taking over your office, you may not have the authority to change them. But you don’t have to let them ruin your day.

Try our tips, tricks and tools to help you counter the negative effects of these changes in your workplace and keep them from putting a damper on your love for your job.

1. Fewer Support Positions

With our economy declining and technology improving, many US companies are removing corporate support positions, like administrative assistants, from offices.

This means employees are responsible for more administrative tasks, like scheduling, booking travel and ordering supplies — on top of their existing job duties.

Fortunately a lot of tools have popped up to assist with this work. To save yourself time trying to do two jobs, use these apps and tools to curb the burden of administrative tasks:

• Refer customers or clients to an online appointment scheduler to avoid email or phone back and forth for one-on-one meetings.

• Use a meeting scheduler within your staff to coordinate the best times for internal group meetings.

• Schedule travel and keep all the info in one place using a travel planning app for your phone or tablet.

• Use the store apps for Office Depot, OfficeMax and Staples to keep track of your office supply needs and get the best deals.

• Take the time to organize your inbox! Use these Gmail hacks and take advantage of Labs to keep your head from exploding.

Want to make money on the side of your day job? Take advantage of the growing need and offer your services as a virtual assistant.

Some employees might be willing to foot the bill themselves for the added convenience. Or they could convince their companies to cover the expense of outsourcing the position, which will be significantly lower than hiring in-house.

2. Disappearing Benefits and Perks

While tech startups follow the lead of giants like Google in amping up the amenities, some traditional companies are cutting costs by eliminating perks that don’t directly support productivity.

In some cases, it’s big things like HMOs and pensions. In others, it’s the little things like Casual Friday, season tickets and free snacks and utensils in the break room — those things that make you feel comfortable and appreciated at work.

While the little things are certainly luxuries, their absence can leave you distracted and less productive. You don’t want to spend half your morning worrying about where to find a fork for the salad you proudly packed for lunch.

Instead of leaving each employee to fend for herself, try coordinating with your co-workers to cover missing amenities. Assign one product to each person, and pool your money to buy drinks, snacks, utensils and toiletries in bulk to save money.

Take the social events and celebrations into your own hands in the same way. Split duties and costs for a weekend picnic or an in-office birthday party among (willing) employees.

Sites like Groupon, LivingSocial and Amazon make planning parties and events with your co-workers affordable, even without company discounts or perks.

3. Open Floor Plans

For years now, we’ve been concerned about the impact of cubicles on workers. Now that companies have responded with open work spaces, employees are complaining about loss of privacy and distractions.

How can you find the right balance?

Here in The Penny Hoarder office, we share an open work space, and I love it.

Yes, phone calls, video conferences and conversations at adjacent desks can be distracting. But the space facilitates a natural collaboration you miss out on when you have to knock at a co-worker’s door to start a conversation.

In our small shared space, headphones go a long way! I can pop in my earbuds, turn on iTunes and escape into my own world for a couple of hours to write.

Headphones and a mic cut the distraction of a video conference in half, as well. They keep the outside party’s voice from adding to the noise.

You can also work with your boss, co-workers or office manager to designate some quiet spaces around the office. We have plenty of side rooms and quiet corners to step into to take a phone call or just get peace of mind when we need it.

4. Hot-Desking

Hot-desking is also a system we employ at The Penny Hoarder HQ, and it works well for us.

The trend, which eliminates assigned workspaces altogether, makes sense for companies whose employees frequently work from home, leave the office for tasks or meetings or work on different projects with different people from day to day.

But hot-desking means you don’t get to “own” any space in the office.

You can’t leave behind snacks or photos of your dog to make you feel at home while you’re at work. (Though I’d suggest in the right company, you won’t need these creature comforts to get through your day.)

So bring your desk with you!

Keep a backpack or briefcase organized with your laptop, a binder or folder of important files, your lunchbox, a water bottle and a coffee thermos. Add the sentimental photos to your computer’s desktop, and personalize your day with your quirky wardrobe or office supplies.

And if working in a new place each day sounds like it would scatter your brain, remember we are creatures of habit. Most days, everyone will migrate to the same desks, anyway.

I sit at the same desk every day, and my neighbors rarely change. But it’s good to know I can take my laptop to another room if I just feel like sitting on a couch or being alone for a while.

Hot-desking also supports collaboration. I can plop into an open desk to work with a coworker for a day without feeling like I’ve displaced someone else.

5. Pressure to Never Unplug

A friend recently complained to me that her company would be increasing their mobile reimbursements… because she’d be expected to answer calls, texts or emails during nights and weekends. Yikes.

Even if it isn’t explicit, this expectation — known as telepressure — is becoming the norm in workplaces. Trends like remote workers across time zones, work-from-home days and virtual communication tools for every need make the work day seem boundless.

And for some reason, you feel guilty when you want to claim those night and weekend hours for yourself!

You shouldn’t.

Clear boundaries are important to a respectful work environment. Disconnecting and decompressing are vital to ensure happy, healthy and effective employees.

What if your company simply requires your after-hours availability?

Changing the rules or quitting your job may not be an option for you, so try some calculated time management to avoid complete digital overwhelm. Learn to manage your email mindfully and efficiently.

Turn off notifications on your phone for email and other communication or task management tools (like Slack, Asana or Flow).

Instead, check in with them on a regular schedule — once per hour, every two hours, twice per day, etc., depending on your company’s volume.

Let your co-workers and the powers-that-be know your schedule and that any urgent (and only urgent) communication should be sent via text or a phone call.

Take Control of Your Workspace

Whether it’s dwindling amenities or chatty office-mates, your office environment shouldn’t make you miserable.

Collaborate with your boss or co-workers when you can and get creative when you have to, and you can make an efficient and inspiring space out of any office.

Your Turn: Have you experienced any of these trends at your office? How do you and your co-workers handle them?

Disclosure: We have a serious Taco Bell addiction around here. The affiliate links in this post help us order off the dollar menu. Thanks for your support!

Dana Sitar is a Staff Writer at The Penny Hoarder. She also writes about writing, work, life and love for blogs and books and sometimes things people care about, like Huffington Post and that one time she had an article published in the Onion. Follow along on Twitter @danasitar.

The post Don’t Let These 5 New Workplace Trends Ruin Your Day appeared first on The Penny Hoarder.

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Open Enrollment 2015: What Medicare Beneficiaries Need to Know

You have a few weeks to change your Medicare coverage. Here are six things to consider.

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Should You Join an Investment Club?

Investment clubs can rake in dough, but it's not nearly as simple as members would like to believe.


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How to Retire in Style returns to newsstands

Mark King

retire-mag3-image.jpg

The third issue of How to Retire in Style is now on sale from all leading newsagents.

The third issue of How to Retire in Style is now on sale from all leading newsagents.

Produced by the team behind Moneywise, How to Retire in Style aims to help people make the most of the pension freedoms that were introduced in April, which allow savers to do what they like with their pension fund.

The third issue of How to Retire in Style is now on sale from all leading newsagents.

Feed Copy: 

The third issue of How to Retire in Style is now on sale from all leading newsagents. Produced by the team behind Moneywise, How to Retire in Style aims to help people make the most of the pension freedoms that were introduced in April, which allow savers to do what they like with their pension fund. Six months on retirees are taking full advantage of the new rules, however, there are major concerns that a lack of education means many savers aren’t making the right choices for them. Research from Royal London has revealed that while 16% of savers who cash in pensions are doing so to repay debts, a worrying 55% are simply putting the money into an alternative investment vehicle or cash savings account. Not only will these savers see the taxman take a significant slice of their savings – with only the first 25% paid tax-free – but they also stand to lose the tax protection provided by the pension wrapper. In addition to tax-free growth, on death money held within a pension is paid free of inheritance tax and, if the saver dies before turning, 75, there is no requirement for any beneficiaries to pay income tax on the money. Moreover, if money is moved into a savings account paying rock-bottom interest rates savers also miss out on the greater growth potential offered by pensions. Rachel Lacey, editor of How to Retire in Style, said: “It’s understandable that retirees want to get their hands on the savings they have worked so hard to build, but this money needs to last a lifetime and so it’s important retirees don’t make any hasty decisions. One wrong foot could land you a hefty tax bill.” “Sadly there is no one size fits all solution. What works for you will depend on your age, state of health, lifestyle, attitude to risk and the size of your pension.” “How to Retire in Styles explains the options in plain English to help you make the right decision.” How to Retire in Style is available from all leading newsagents for £4.99 or you can order your issue online today.

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How Will Social Security Help You With Your Retirement Savings Plans?

One common question that I’m asked all the time is how exactly a person can figure out how much they need to save for retirement including their potential Social Security benefits.

In the past on The Simple Dollar, when I have done calculations regarding retirement savings, I have completely ignored Social Security benefits. I’m in my thirties, which means that I won’t tap Social Security benefits under the current rules for at least thirty more years. That is more than ample time for the rules to change significantly, including changes that could postpone the retirement age and also cut benefits.

In short, I personally do not believe that the current level of Social Security benefits will exist when I reach retirement age. Because of that uncertainty, I don’t include Social Security at all when I do my own retirement calculations. If I do receive benefits, I will view them as an extra bonus.

That personal opinion, however, does not change the fact that, for now, Social Security is a pledged benefit to those who have contributed enough to earn that benefit (usually through working full time for several years). Many, many Americans rely on that benefit today to make ends meet, and many more will come to rely on that benefit as they reach retirement age and exit the workforce.

My parents are currently in that latter boat. Although my father receives a guaranteed pension, they would still have difficulty surviving if it were not for the additional money that comes to them in the form of their Social Security check. They planned ahead using that pension, a small amount in a 401(k), and their Social Security to be able to survive in their retirement years.

Today, very few of us have a pension that we can look forward to relying on when we retire. We have to save for ourselves, and that usually takes the form of a 401(k) or a Roth IRA. The question is how much do we really need to save?

Using Social Security as a tool to help you estimate your needed retirement savings is actually pretty easy, so let’s get started.

Step One – Figure Out What You’ll Actually Need in Retirement

This first step has nothing at all to do with savings or anything else. Instead, it’s an estimate of how much you’ll need to have to survive in retirement.

I always encourage people to calculate this amount in pre-tax dollars based on a person’s salary without the income taxes or other benefits taken out. There are several reasons for this, the biggest one being that most of the retirement benefits that people take advantage of are calculated in pre-tax dollars. So, when you’re calculating retirement savings, don’t worry about pre-tax or post-tax – instead, just view the post-tax accounts as being likely to provide a bit of a tax break for you when you’re actually in retirement.

So, how do you figure out how much you’ll need in retirement? The first thing you should do is look at your current salary (or salaries, if you’re doing this as a combined calculation) and the current amount of your total personal contribution to savings. So, for example, let’s say you earn $50,000 a year and you contribute 10% to your 401(k), but that’s your only significant savings. That would mean that your current salary minus your contributions is $45,000 a year.

Study after study has shown that people spend less in retirement. The often-quoted percentage of your current spending is 80%, so multiply the number you figured out from your current salary minus your savings by 0.8. In the case of the $45,000 number, that leaves you with $36,000.

You’ll need $36,000 in today’s dollars per year to survive in retirement with a lifestyle comparable to a person earning $50,000 today while putting 10% of his/her income into a 401(k).

Now, you’re going to want to inflate that number, because inflation is a real thing. I usually recommend people look at how much inflation there will be between now and ten years past their retirement date, so that inflation doesn’t sneak up on them.

So, decide on what age you think you will retire and add ten to that. If you’re going to retire at age 65, for example, add ten.

Then, you’ll want to know how many years there are between your current age and that “inflated” retirement age. So, let’s say you’re 40 today. Just take 75 and subtract 40 from that, giving you 35 – that’s how many years of inflation you’re going to worry about.

Then, head over to this nifty calculator. Put in your current “dollars per year to survive in retirement” into the “Today’s Amount” space, leave the annual inflation rate alone (3% is a very good number to use), and put the number of years of inflation you’re thinking about into the “Number of Years” space and hit “Calculate.”

In the example above, with the person needing $36,000 a year in retirement and having 35 years of inflation to consider, that person will need $101,395 per year in retirement income to survive.

That might seem like a lot, but remember that number includes another 35 years of inflation. Things like a gallon of milk will cost on the order of $15 at that point.

Step Two – Figure Out Your Likely Benefits

The first thing you need to do is figure out how much you’re going to earn from Social Security benefits when you retire. The Social Security Administration offers an online tool that makes it easy to estimate your benefits.

However, there’s one key piece of information that you have to decide for yourself. At what age are you planning on retiring? Social Security offers different benefits for different retirement ages, with lower benefits if you start receiving benefits at age 62 and higher benefits if you start receiving benefits at a later age.

Using the data above, assuming a $50,000 annual current salary and a retirement age 30 years down the road, the calculator estimated that I would receive $1,800 per month in Social Security benefits in retirement.

Note that this amount doesn’t take inflation into account. As it says on the benefits calculator page:

After you start receiving benefits, they will be adjusted for cost-of-living increases.

So, again, you should adjust this number for inflation using the inflation calculator mentioned earlier. The way to do that is to multiply your estimated benefit by twelve – it’s a monthly benefit, so you’re just converting it to an annual benefit – and use the number of years you calculated in step one (in this example, 35 years).

By multiplying $1,800 by twelve, I figure out that my annual benefit is $21,600. Then, I use the inflation calculator, plug in $21,600 and 35 years, and discover that my inflation-adjusted benefit is $61,342.

Then, I just take my inflation-adjusted spending estimate – $101,395 – and subtract from that my inflation-adjusted Social Security estimate – $61,342 – and I have the amount I’ll need to come up with on my own per year in retirement – $40,053. We’ll just round that to $40,000 to make it easy.

Step Three – Figuring Out How Much to Save

This is the part of the equation where we start worrying about safe withdrawal rates. The Trinity Study, as discussed in this recent Forbes article, suggested that withdrawing 4% of your balance per year will ensure that your balance survives for at least 30 years in almost any climate provided your investments are reasonably balanced. A thirty year retirement is a pretty good estimate for most people.

However, if you’re worried about those outlier chances – the chances that the stock and bond and real estate markets don’t do well or that you’ll live longer than thirty years in retirement – you may want to consider a lower withdrawal rate. A 3% withdrawal rate would, in almost every environment in American history, provide enough savings to exist nearly forever, far beyond the number of years in a natural lifespan beyond retirement age.

So, let’s look at both sides of that equation.

First, what about the 4% withdrawal rate scenario? You’d need to multiply the amount you need per year from your savings in retirement – $40,000 – by 25, which equals $1 million. That’s the amount you’d need to have in retirement savings when you retire 25 years from now (remember, we’re looking at someone at age 40 who is retiring at age 65, which is 25 years).

What about the 3% withdrawal rate scenario? You’d need to multiply the amount per year by 33, which equals $1.32 million.

Now, that seems like a huge number, but there are a few things working in your favor.

First of all, the earlier you start saving, the greater the power of compound interest. Let’s say that you’ve decided to save 10% of your salary, which in this example is $5,000 a year. That first $5,000 that you save is going to have 25 years to grow before you hit retirement age. If you assume a steady return of 7% per year on your investments, that’s $27,000 right there.

Second, if you’re contributing a percentage of your income, that amount you contribute will grow with your raises in the future. Even if you simply get 3% cost of living raises in the future, that means that your contributions each year will go up.

Third, your target number is already adjusted for inflation, whereas your dollars today are not. The gap looks big, but that’s only because your target number has 35 years of estimated inflation rolled into it. When you look back at 1980s prices, with gas in the $0.70 per gallon range, it looks quaint. That’s how today’s prices will look to you 30 or 35 years from now.

Finally, you may actually have some income in retirement. Many retirees get bored sitting at home and take on jobs in retirement to get out of the house and to earn a little extra money. These calculations are assuming no additional income in retirement.

So, how much should you save per year?

I think that an easy rule of thumb is this: if you’re starting retirement savings before age 35, you can get away with saving 10% of your income per year and be just fine in retirement. You could probably get away with 10% up to as late as age 40, but I’d encourage you to bump it up before then.

If you’re over 35, you may want to consider a higher percentage. I would add 0.75% for every year you’re over 35 and stick to that percentage until you’re retired. So, if you’re 45, you should consider saving 17.5% of your salary for retirement until you actually retire. If you’re 55, you should consider 25% (at least – you’ll probably need even more than that).

A Big, Big Caveat About Relying on Social Security

There is something really important to note on the Social Security benefits calculator page:

Your estimated benefits are based on current law. The law governing benefit amounts may change because, by 2034, the payroll taxes collected will be enough to pay only about 79 cents for each dollar of scheduled benefits.

This is a huge point. That 2034 date is less than two decades down the road. For me, that 2034 date arrives well in advance of when I would start claiming Social Security benefits.

To me, the $0.79 number isn’t that specifically important. After all, it’s a pretty rough estimate based on future income forecasts and economic projections. The point that really shakes me is that they know that under current projections they won’t be able to pay out the benefits that are scheduled for that point.

For those of us that are younger, that’s something to really worry about. It means that Social Security, in its current form, will not be there for us without some sort of significant policy change that increases the amount of money contributed by each person to Social Security.

Making that kind of political change is extremely difficult. Many interest groups are very much opposed to that kind of change, and it will take a lot of political courage to make it happen. Politicians have been passing the buck regarding that situation for many years and there’s no reason to think that things will be resolved until they are literally pushed up against the wall of Social Security benefits going away. At that point, they’ll be struggling with reduced revenue, so it’s hard to tell what will happen.

My personal suspicion is that benefits will be cut for people under a certain age at some point, and I’m pretty sure I’ll find myself under that cutoff age. That’s why I don’t rely on Social Security benefits for my own calculations, and it’s why I encourage people to save at least 10% per year if they start in their twenties and at least 15% a year if they’re starting in their thirties.

Step Four – The Actual Process of Saving Money

At this point, you should have a estimate of how much you should be saving for retirement each year so that you can have a healthy retirement. That number is probably in the form of a percentage of your current salary.

So, what do you do?

The easiest step for most people is to simply sign up for the retirement plan available at work. Depending on your employer, this could either be a 401(k) plan, a 403(b) plan, or a Thrift Savings Plan, among other options. Sign up to contribute the percentage you calculated, and put that money into a Target Retirement fund if available (there’s usually one available).

So, if you’ve calculated that you need to save 12% per year for retirement, then you should either sign up to contribute that much or adjust your current savings to match that amount.

Some employers offer matching funds for employee contributions to retirement accounts. If you are going to receive some matching funds, you can subtract that percentage number from the amount you’re contributing if you wish, though I would probably just stick with your own calculated number for your personal contributions and view any extra thrown in by your employer as a bonus.

What about a Roth? That word actually means a few different things. If you’re talking about a Roth 401(k) plan (or Roth 403(b) or other Roth plan) offered by your employer, choose that instead of the traditional plans. They offer some tax benefits that will help you out down the road.

On the other hand, you may be curious about setting up your own Roth IRA. An IRA is simply an Individual Retirement Account, which means that it’s a retirement plan you set up yourself by simply contacting an investment firm. I have mine through Vanguard. A Roth IRA is actually a post-tax account, which means that you pay for it out of your take-home pay, but it has the advantage of requiring you to pay no taxes when you withdraw that money in the future – anything you gain in that account is tax free when you take it out in retirement. That’s a pretty sweet benefit.

Signing up for any of these options is really easy, even the Roth IRA. They just require basic identification of yourself, a selection of your preferred investment option (I usually encourage people to just choose a Target Retirement account with a year attached to it that’s close to when they will retire), and then setting up an automatic payment plan of some kind to fund that retirement savings, which just requires information from your bank or, in the case of your workplace, merely requires a signature.

Final Thoughts

The actual impact that Social Security will have on the retirement of most people under the age of, say, fifty or so is a tricky thing to talk about. We often perceive it as some kind of guarantee, but the Social Security Administration itself tells us that there isn’t enough money there to pay out all of the promised benefits. Thus, I personally don’t rely on Social Security at all when calculating my personal retirement savings goals.

However, others may feel differently. Many people expect that Social Security will be completely funded in the future and that any shortfalls will be fixed. That’s a future I absolutely hope for, because it means a better retirement for almost everyone in America.

I encourage everyone to save as though there won’t be Social Security, but many people have faith in Social Security and believe that it will be there for them. If you rely on Social Security, then, it becomes much easier to hit a retirement goal that will provide a great lifestyle for you in your golden years.

Regardless of whatever route you decide to follow, it will require you to put aside money from your paycheck starting as soon as possible, and the more you put aside the better. That’s true no matter what you expect to happen to Social Security in the future.

My suggestion? Whether you believe in the future of Social Security or not, save as much as you possibly can for retirement. No one ever regretted having too much money when they retired, after all.

Good luck.

The post How Will Social Security Help You With Your Retirement Savings Plans? appeared first on The Simple Dollar.

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How to Save $200 More Per Month

A few phone calls could significantly reduce your monthly bills.

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5 Things Americans Want From Tax Reform

We the people deserve fair taxes. 

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Do You Get Too Many Emails From LinkedIn? It Might Owe You Up to $1,500

If you use LinkedIn, you might be eligible to claim up to $1,500 from their recent class-action settlement.

LinkedIn came under fire in a class-action lawsuit over excessive emails — which may be unsurprising to regular users. The professional social network crams your inbox with notifications, from potential connections to new endorsements to work anniversary celebrations.

But the recent case centered on one offense in particular, in which LinkedIn might have spammed people you added to your professional network. Here’s how to tell whether you can claim some of the cash.

Where LinkedIn Went Wrong

When current users tried to recruit outside contacts using the “Add Connections” button and the contacts didn’t respond, LinkedIn took advantage of its access to those email addresses by sending two additional reminders.

The court found the company’s actions fell outside of the scope of member consent, which was limited to a single invitation notification and not multiple reminders.

Although LinkedIn denied any wrongdoing, it agreed to create a $13 million fund to pay out up to $1,500 per plaintiff, depending how many people file claims.

It’s not the first time LinkedIn’s been in legal hot water, either. You might remember the company recently settled a suit about 6.5 million stolen passwords.

Are You Eligible?

Long story short: If you used LinkedIn’s “Add Connections” feature between September 17th, 2011 and October 31st, 2014, you are eligible to file a claim.

Users who qualify were notified by LinkedIn via — you guessed it! — an email.

How to File Your Claim

Check your inbox for yet another message from LinkedIn.

The email explains the settlement and provides you with an ID to file. Take that ID and head over to this page, where you can file your settlement claim.

Then sit back and wait — and rejoice in the fact that your LinkedIn spam is about to slow down.

Your Turn: Are you eligible to file a claim in the LinkedIn class-action spam suit?

Jamie Cattanach is junior writer at The Penny Hoarder and a native Floridian. She’d like to add you to her professional network on LinkedIn. If you want. No pressure.

The post Do You Get Too Many Emails From LinkedIn? It Might Owe You Up to $1,500 appeared first on The Penny Hoarder.

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When Your NFL Team Wins, So Do You. Check Out These Deals!

Whether or not you’re a football fan, you could be in for some freebies this season when your local team scores.

Lots of vendors celebrate football victories, touchdowns and sacks by giving you great deals. Money rounded up a full list, and here are some of the highlights.

Papa John’s

Papa John’s widespread campaign brings you cheap pizza the Monday after your team wins.

Look up your location to see if your team qualifies and the specific promotion being offered, generally 50% off your order. The following teams have confirmed coupon codes:

Baltimore: RAVENS50

Atlanta: FALCONS50

Carolina: PANTHERS20

Cincinnati: BENGALS50

Cleveland: BROWNS50

Chicago: BEARS

Dallas: COWBOYS20

Denver: BRONCOS

Houston: TEXANS

Indianapolis: COLTS50

Minnesota: VIKES50

St. Louis: RAMS50

Seattle: HAWKSWIN

Most of the promo codes include the team name in caps followed by “50,” but there are some variations. And Carolina and Dallas fans are in luck — their teams don’t even have to win, just score 20 points, to activate 50% off coupons!

Jack in the Box

Jack in the Box has a number of deals for West Coast football fans.

San Diego Chargers fans can cheer even harder when their team scores two touchdowns in a game — the following day, they’re eligible for a free Jumbo Jack burger with a large drink purchase.

Californians further up the coast, however, should root for the 49ers, who get the same deal when the opposing team turns the ball over to San Francisco — say the phrase “Jumbo Jack Takeaway” when you order.

In Seattle, Seahawks fans get free Jumbo Jacks with the purchase of a large drink when their team sacks the opposing quarterback three or more times. Just mention the “Seahawks Three Sacks” promotion.

Dunkin Donuts

Back east, fans might not get free beef — but they can get a free buzz from Dunkin Donuts if they download the company’s mobile app.

If you’re rooting for the Cincinnati Bengals, New England Patriots or Philadelphia Eagles, you can look forward to a free hot or iced medium coffee the day after the game.

There’s no free lunch in New York, though — a post-Jets victory java will still cost you a quarter.

What Else Can Your Team Win You?

Atlanta fans can enjoy $40 in instant savings from Kauffman Tire for each quarter the Falcons score. That’s $160 off any set of four tires if they score once each quarter!

If you attend the Seattle Seahawks game and the defense causes three or more turnovers, bring your ticket stub to Great Cuts for a free haircut the following week. Check out these other unique Seahawks deals — you’re sure to be in for something awesome.

Finally, Cleveland Browns fans could earn a $100 gift card for Giant Eagle supermarket if they win the tailgate photo contest. Share your photo with the hashtag #GiantEagleTailgate to enter.

Don’t see any freebies for your team? Check out the full list on Money. Be sure to keep an eye out for local deals or check with vendors you visit often.

Your Turn: What great football season freebies do you claim in your area?

Jamie Cattanach is junior writer at The Penny Hoarder and a native Floridian. She’s passionate about learning, literature, chocolate and finding ways to live the good life as cost-effectively as possible.

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Memo to the big banks: You had one job

OPINION: Memo to the big banks: Australians don’t want ‘cheesy’ social media campaigns. They just want a bank that does what it’s supposed to do.

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8 Ways You Can Make Money When You Travel

By Anum Yoon No matter how frugal you are while traveling, money also seems to go quicker than you thought it would. If there were a downside to traveling, it’d be the cost of going for as long as you want. That’s why doing some work on your travels can extend your trip for quite […]

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Video on demand named as UK’s best value household service

Tom Wilson

Somebody has too many options.jpg

Moneywise readers have voted video on demand (VoD) packages as the best value household service in a new survey of 14,000 people.

Moneywise readers have voted video on demand (VoD) packages as the best value household service in a new survey of 14,000 people.

Those who voted said VoD products were better value for money than energy, mobile, landline and broadband providers.

Video on demand named as UK’s best value household service

Feed Copy: 

Moneywise readers have voted video on demand (VoD) packages as the best value household service in a new survey of 14,000 people. Those who voted said VoD products were better value for money than energy, mobile, landline and broadband providers. They told Moneywise they were impressed by the ease, quality of service and choice of entertainment on offer from VoD firms, which include Netflix, Blinkbox, Amazon and Now TV. A total of 13,874 people took part in the Home Finances survey – which was open for voting from 26 June to 1 September – judging their households’ suppliers across groceries, utilities and entertainment. The survey forms the basis of our Home Finances Awards – the winners of which will be announced online in mid-October. Despite VoD being a new entrant to this year’s awards survey, it went straight to the top of the charts, narrowly beating mobile phones as the best value service. This was in no small part down to Now TV, which scored top among VoD providers for in each of the five categories we asked them to vote on. Value for money aside, these included: choice of entertainment, viewing quality, ease of use and customer service. Among VoD providers, Netflix ranked second for value for money, followed by Amazon. Talk Talk’s Blinkbox came in last, though it still received a good score across the board. Across all services assessed in the 2015 Home Finance Awards survey, gas providers ranked third in terms of value for money, followed by supermarkets, broadband, TV, electricity and, finally, water. However, readers were generally happy about what they’re getting, with even the lowest ranking services scoring positively. The full results of the 2015 Home Finance Awards will be published on moneywise.co.uk on 19 October, and in the November edition of the magazine.

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The ‘evil ambassadors’ Toyota, Coke, Nike hate

THE revelation that ISIS fighters love to tear around in Toyota trucks isn’t the first time a major brand has wound up with some very unwanted ambassadors.

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