It is not so much the "Insta", but the "finsta" that concerns parents of tweens and teens.
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الاثنين، 13 أغسطس 2018
Does my daughter’s career matter as much as my son’s?
Our children are born equal. We have the same hopes and dreams for them. However, many parents probably wouldn’t admit that their expectations for their children are different according to their genders.
Much has been made of the gender pay gap in the workplace, and it would seem that the Equal Pay Act of 1970 has had little effect on female careers. The gender pay gap reduces women’s lifetime earnings and also affects their pensions, which is one of the significant causes of poverty in later life for women.
Nationally, the gender pay gap stands at 18.4%, according to the UK’s Office for National Statistics. Meanwhile, Financial Times analysis of government data, combined with employee numbers from business information provider DueDil, which covers two-thirds of employers, suggests that 89% of women work for a company with a pay gap that favours men, and half work for a company that pays men at least 9% more.
But what are the causes of men and women having such a different career prognosis?
Gender stereotyping starts young
We invest in our children from an early age, selecting a good school and supporting a range of extracurricular activities. We aim for a broader education than merely academic achievement, but often the choices we make re-enforce gender stereotyping, and this begins when children are young.
Research conducted by Dr Javid Abdelmoneim for the 2017 BBC programme No More Boys and Girls: Can Our Kids Go Gender Free? found that children as young as seven have already absorbed the idea that boys are more important than girls.
And this continues as we get older. Research shows that school career services often encourage girls and boys into traditionally gendered occupations. This means women often work in sectors where wages are, on average, lower than in jobs that are dominated by men. A 2018 publication by the European Commission on equality between men and women found that women in EU countries dominated the occupational categories of shop salespeople, cleaners, personal care workers, pre-primary and primary school teachers, and secretaries. At the same time, the share of women within other occupations, such as engineers or ICT professionals, remained low.
Meanwhile, research conducted by graduate career website Milkround.com reveals that only 17% of women expect to earn £25,000 to £35,000 in their first jobs, compared with almost half of male graduates.
“Nearly 85% of female graduates do not know their own value, which may have a knock-on effect in their future earnings,” says Francesca Parkinson, head of marketing at Milkround.
Men and women have the same challenges in the workplace
However, Jo Cochrane, a partner at workplace coaching firm AGM Transitions, says that when it comes to reaching the top of an organisation, men and women suffer equally from the same challenges, including self-doubt and ‘imposter syndrome’ – although men are less prepared to admit it.
Mrs Cochrane adds that more often men have achieved promotion despite confidence issues, while women let it affect their opportunities.
Cheryl Giovannoni, chief executive of The Girls’ Day School Trust, a charity that runs 25 independent girls’ schools, recognises that women can be backwards in coming forwards. “All too often when it comes to the world of work, women can develop what is sometimes knows as ‘tiara syndrome’,” she told The Sunday Telegraph. “They wait for recognition, whereas men put themselves forward to get what they feel they deserve.”
But these days, men and women (with or without children) are increasingly asking for and negotiating flexible working or starting their own businesses so they can control when and how they work.
To make this worthwhile, we need to invest in our daughters’ education to help counteract the hurdles and ensure they get just as good a footing on the career ladder as their male counterparts.
Seven steps to boost your career prospects – whatever your gender
The people with the most positive career prognosis are those who actively manage their careers. Here are some tips on how to do this.
- Have a career goal. Why are you working at all? Is it to have a good work-life balance or work in a field that you love? Or do you aspire to retiring early, having made a lot of money? Having a career goal is the most important thing you can do to help yourself.
- Study for professional qualifications. Qualifications open doors and broaden your horizons, so negotiate support – including financial help – from your employer. It’s a win-win for both sides and it will help to increase your rate in the job market.
- Make your hobbies count. These days most people can expect to have more than one career. Often these come from your personal interests, including voluntary work.
- Play the long game. Taking a career break to travel or care for family members doesn’t have to mean your career goes on hold.
Use the time to gain other skills, study towards something that may open new doors or get voluntary work experience in new areas that interest you. - Recognise that the world of work has changed. Many people are moving from employment to self-employment and back again. Book a session with a career coach to help you plan your career and identify all your options.
- Keep a record of your achievements. Corporate appraisal systems record your progress against the company’s objectives and your own career goals, but that stops once you leave. Get into the habit of setting yourself personal and professional targets and monitoring your progress. Share these with others and ask them to hold you to account. It will really set you apart, especially any data you can share with future employers.
- Stay up to date with technology. You will be harder to employ if you aren’t savvy with technology, don’t carry a smartphone or have no awareness of social media.
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Don’t be afraid to haggle - you’ll be surprised how easy it is to get a better price
I remember my first experience of haggling well. It wasn’t actually me doing the haggling, but my formidable little Italian mother. She marched into a major white goods retailer and proceeded to negotiate animatedly with the salesman. Me, a dreadfully embarrassed 14-year-old, looked on in a mixture of amazement and horror.
Recent research from price comparison website MoneySuperMarket has found that us Brits are nervous about haggling. Two in five people say they wouldn’t haggle at all. Nearly half (44%) are simply too embarrassed, while one in five (21%) thinks it’s too cheeky or rude to do so. Bizarrely, one quarter (25%) say they don’t have the ‘skills’ to haggle.
You don’t need to be a Cockney wide boy to do it, but you would be really surprised by the number of different ways you can save money by a bit of haggling. Having watched and learnt from my Mediterranean mum, it is something I have put to good practice. But I have also learnt there is more to it than just stomping in and demanding a lower price.
Most recently, I was on the lookout for a new phone deal. The latest handset had come out and I was determined to get a good deal on a contract. So I consulted my good friend Google and found a selection of online prices from various providers. This is an important first step because often in-store salespeople will work to a commission and are willing to meet your demands to get the sale. If you’ve got the online price in mind, tell them and see if they can beat or (at least) match it.
I quoted the salesperson the deal I had seen and they immediately agreed to match a 20% discount on the contract and no upfront cost for the phone. Over the course of a two-year contract, five minutes on the internet and one question asked in the shop will save me upwards of £300. It really was that easy.
The MoneySuperMarket findings also revealed that only one in five (20%) of homeowners haggled over the price of the house they bought. This is the biggest thing you’ll ever buy in your life, and it is well known that sellers will have a price range in mind. It’s in the interest of the estate agent to push you to the higher end of that range, so if you don’t ask, you’ll pay too much.
Haggling doesn’t just have to be about cash value either. Going back to my mum, she walked away that day with a new washer and a free insurance policy. The salesperson was keen enough to shift some goods that he’d throw in a guarantee that if it broke, they’d fix it.
Speaking of insurance, this is a marketplace that’s ripe for haggling. Insurers have a bad habit of punishing loyalty. Last year, when my home insurance policy was up for renewal my premium quote was 50% higher than the year before, despite my circumstances being exactly the same. After shopping around, I gave the insurer a call, and it lowered its quote substantially. Ultimately, these companies would rather have 100% of something than 150% of nothing.
I also managed to haggle down my travel insurance. My pension provider sends me periodic ‘offers’ for other products. On this occasion, it offered me a free one-year European travel insurance policy for being such a loyal pension customer. Now, I had two holidays planned this year. One to Colorado, USA and one to Cape Town, South Africa. So I gave the provider a ring and said: “Sorry, I don’t need European travel insurance, but what about worldwide cover, excluding Europe?” I had checked how much this type of cover cost (around £50) online, so when the nice lady on the phone suggest I pay £20, I took her up without hesitation!
There are some important pointers to remember when it comes to haggling, though. Don’t be pushy or aggressive. A smile and friendliness are much more disarming. Do your research. If you go into buying something with no benchmark of value, you won’t get what you want. And be prepared to walk away. If the salesperson isn’t interested in negotiating, often a competing business will be.
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Yer Not a Wizard, but You Can See All 8 Harry Potter Movies for $5 Each
Cinemark Theatres will play all eight films, along with “Fantastic Beasts and Where to Find Them.”
The marathon is in honor of the 20th anniversary of the U.S. release of “Harry Potter and the Sorcerer’s Stone,” J.K. Rowling’s first book in the series that launched a cultural phenomenon.
The movies will play from Aug. 31 through Sept. 6 in 141 Cinemark theaters nationwide.
If the MoviePass saga is any indication, Penny-Hoarding movie buffs don’t want to break the bank to see their favorite films. That’s why this announcement is even more exciting: Tickets are already available for purchase at just $5 each.
If you want to see all nine movies, you can save even more. Cinemark is selling weeklong passes that get you into every movie for just $25.
Desiree Stennett (@desi_stennett) is a senior writer at The Penny Hoarder.
This was originally published on The Penny Hoarder, which helps millions of readers worldwide earn and save money by sharing unique job opportunities, personal stories, freebies and more. The Inc. 5000 ranked The Penny Hoarder as the fastest-growing private media company in the U.S. in 2017.
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Auto Bits: Terrafugia to begin testing flying cars in New Hampshire
Tip of the WeekFlying cars are the stuff of sci-fi movies not reality, or are they? Terrafugia is a Massachusetts-based company working on building flying cars and it recently secured permission to begin testing them at an airport in Nashua, New Hampshire.Terrafugia is leasing hangar space at the airport and expects it to be adequate to manage the first couple of years of testing. Its flying car, called the Transition, isn’t just a pipe dream. It’s slated for production in [...]
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How to Get More Email Subscribers Without Annoying Your Website Visitors
With so many new content marketing strategies out there today, it can be tempting to look past your email list. After all, how important can it be?
To say the least, email marketing is crucial. It needs to remain part of your core marketing foundation.
Research shows that 99% of consumers check their emails every single day.
Between personal email addresses, work accounts, computers, and mobile devices, some consumers check their inboxes even up to 20 times per day.
More than 80% of retailers say email marketing is the driving force behind their acquisition and customer retention strategies.
From a marketing perspective, sending emails is an extremely cost-effective strategy as well. On average, the ROI yields $40 for every dollar spent, which is the highest among other strategies.
But your email campaigns won’t work unless you have lots of subscribers. That’s why you need to learn how to build your first email list from scratch.
While you may understand the importance of growing your subscriber list, you need to recognize the impact your growth strategy has on your website.
Yes, you want people to opt in to your email content, but at what cost? You don’t want to overwhelm your website visitors and bombard them with nonstop sign-up requests and notifications.
This will backfire. If the people visiting your website get annoyed, they may leave and never come back.
Fortunately, there are ways you can get more email subscribers without annoying your website visitors.
I’ll show you ways you can implement these tactics on your website. Let’s dive in.
Add a sidebar to your homepage
You need to come up with ways to promote your email list without spoiling the user experience.
After all, you still want visitors to consume your content.
That’s why a sidebar on your homepage is the perfect place to include an email opt-in form. As you may have noticed, I use this strategy on the QuickSprout blog.
It’s simple yet effective.
Visitors can navigate through my website and read my blog without being annoyed by giant bells and whistles trying to get them to subscribe to my email list.
The size, placement, and location of the opt-in button on my sidebar are subtle, yet clear and legible.
In addition to placing a sidebar to your homepage, you can place it on other pages of your website as well.
This will increase your chances of getting more subscribers.
First of all, not everyone will navigate directly to your homepage. If someone lands on another page through an organic search, you still want them to see your sidebar.
Furthermore, since the sidebar is subtle, it’s possible a website visitor could overlook it on your homepage. As long as it’s out of the way and doesn’t obstruct their navigation experience, it won’t be annoying if you place it on multiple pages.
Create a separate landing page
Another way to get more email subscribers is by building a dedicated landing page for opt-ins.
This definitely won’t annoy your website visitors since they won’t see the page unless they navigate to it.
Plus, having a separate landing page will make it easier for you to promote your email list through other marketing channels. For example, if you’re promoting your email content to followers on social media, you can provide a link to this page rather than your homepage.
Look at how Moz accomplishes this strategy with its dedicated opt-in landing page:
I really like the way MOZ pitches its email list.
Rather than just asking customers to subscribe to its newsletters, it differentiates itself from the competition.
Website visitors know exactly what they’ll be getting if they sign up to receive this content. There won’t be any surprises.
Moz will deliver them the top ten articles about online marketing and SEO on a semi-monthly basis.
The visitor also knows that their inbox won’t get flooded with too much promotional content if they subscribe.
Allow visitors to create an account before making a purchase
You can also get more email subscribers by making it easy for visitors to provide you with their information while they’re completing another action on the site.
The idea here is that you want to limit the number of steps for any given process.
For example, let’s say a customer wants to create an account on your website. If they provide you with their email address at that time, they shouldn’t have to do it again to sign up for emails.
I recommend combining the account creation strategy with your email opt-in method when customers are making a purchase.
Look at this example from Lululemon:
As you can see, the brand gives its website visitors an option to create an account before starting the checkout process.
By creating an account, they also sign up for emails.
That said, you don’t want to force people into your email list. The customer can easily uncheck the box if they don’t want to subscribe.
We’ll talk more about these checkboxes during the checkout process in greater detail shortly.
Trigger pop-ups when visitors display intent to exit
As I said before, you don’t want to overwhelm your website visitors with pop-ups.
If someone lands on your page and a pop-up takes over the screen within the first few seconds, it’ll annoy the visitor. You don’t want this to happen.
But timing is everything.
You can set a pop-up to appear when a website visitor displays an exit intent. OptinMonster provides this technology and uses the strategy on its own website:
Interestingly enough, I was on the website reading more about its exit-intent technology.
There was a hyperlink within the content that said “9 unique exit intent popups,” which I highlighted above for you to see. I thought it was interesting and relevant, so I clicked to open it in a new tab.
That’s when the popup came.
The exit-intent technology recognized I opened a link in a new tab, which means I was probably going to leave the current page to read it.
OptinMonster used this popup as an opportunity to collect email addresses.
To those of you interested in implementing this strategy, I’d recommend checking out this software. It’s refreshing when brands practice what they preach, and the technology worked as advertised when I was browsing on this site.
Pin a sticky bar to all your pages
Sticky bars are similar to sidebars, discussed earlier.
Sidebars are located on the side of your pages, just as the name implies. But sticky bars get placed at the top of the page.
As users scroll, the sticky bar remains in place.
You can use services such as Unbouce to build sticky bars for your website.
As website visitors scroll and navigate, they’ll always see the option to sign up for your emails.
Users won’t perceive it as annoying because the sticky bar isn’t intrusive and won’t disrupt their experience as they browse through your site.
Place your subscribe boxes at the bottom of your content
Again, we don’t want your opt-in requests to take over your website. Your website visitors need to be able to read through your content without being interrupted.
That’s why placing the subscribe boxes at the bottom of your pages is a viable strategy.
There are several benefits to this method.
First of all, it doesn’t impede the user browsing experience. But it also gives your website visitors a chance to consume your content.
If they’ve never been on your site before, why would they want to sign up to receive emails from you within the first few seconds of their visit?
But after they have a chance to navigate and scroll to the bottom of your page, they’ll be more familiar with you and your service or product. This is your chance to tell them you have an email list.
Check out how ProBlogger uses this tactic on its website:
As you can see, the subscribe boxes are at the very bottom of the page.
This is another example of how the information included tells prospective subscribers exactly what they’ll be receiving if they sign up for emails. It’s a weekly newsletter that provides advice, tips, and tutorials on blogging.
Consider moving the placement of your current opt-in boxes to the bottom of your pages.
Create an opt-in checkbox during the checkout process
Earlier I talked about how you can collect email addresses by giving customers the option to create an account before they make a purchase.
That said, you don’t want to force people to create an account just to buy something. If you have a long and complicated checkout process, it will hurt your conversion rates.
That’s why you need to understand and implement my shopping cart abandonment prevention tactics.
Even if a customer doesn’t create an account, they’ll still need to provide you with their email address to get a receipt, order confirmation, and shipping information.
Add a simple checkbox to this process that gives the consumer an option to sign up for your email list.
Here’s an example of how Walmart uses this strategy:
Walmart has a guest checkout option. If people don’t have an account, they can make a purchase without creating one.
As you can see, an email address is still a requirement to complete the purchase.
They added a simple checkbox below the email field so their customers can subscribe.
Similar to the example we saw earlier, if someone doesn’t want to opt in, all they need to do is uncheck the box.
Offer an incentive to subscribe
Sometimes, people need some motivation to do something.
Sure, your newsletter may be informative, but is that really intriguing enough to get customers to sign up for emails? Giving them an incentive to sign up can increase the chances that they’ll opt in.
When in doubt, remember that monetary benefits and discounts are always a safe bet.
Consumers are sensitive to prices. Everyone wants to save money when possible. If you offer your website visitors a way to get a discount by providing their email address, they’ll probably go for it.
Look at how TOMS implements this strategy on its ecommerce website:
Yes, I know it’s a pop-up.
However, it’s not too obtrusive, and it’s easy for visitors to close the popup if they don’t want to see it.
Plus, it won’t be perceived as annoying if they are getting something in return.
Add a slider box
Slider boxes are similar to pop-up windows, but they are less intrusive.
Rather than popping up and taking over the screen, they simply slide into view to draw the visitor’s attention, remaining in the corner of the screen.
Here’s an example of how BuildFire uses sliders on its website:
This slider is specifically designed to collect email addresses.
Notice how big the slider is on the page. It probably takes up maybe 20% of the screen, at most. Visitors can still scroll and navigate without a problem.
If the visitor doesn’t want to subscribe, they can easily close the slider box without getting annoyed or frustrated.
Thoughtfully place a subscribe box at the beginning of your homepage
If collecting email addresses is one of your primary marketing strategies right now, you may not want to bury the opt-in buttons at the bottom of your page or on a separate landing page.
You can still promote your email list at the beginning of your homepage.
Just make sure it’s done tastefully. Let’s look at how ConversionXL uses this strategy on its website:
The company felt getting subscribers was important enough to put the invitation to subscribe at the beginning of its homepage. There’s nothing wrong with that.
But notice that it doesn’t take over the entire page.
The pages does both: displays other content and collects email addresses.
If you want to apply this strategy to your website, make sure you consider the layout to help you design a homepage that converts.
Conclusion
You need to prioritize your email marketing strategy and constantly try to add more subscribers to your list.
That said, you don’t want to annoy your website visitors.
Promote your email list with a sidebar or sticky bar. Create a separate landing page dedicated to adding subscribers.
Collect email addresses during the checkout process. You can do this whether customers are creating an account or going through a guest checkout procedure.
If you use pop-ups, trigger them when a visitor shows an exit intent. Or you can use a slider that takes up less space on the screen.
Placing the subscribe boxes at the bottom of your pages gives your website visitors a chance to consume your content uninterrupted.
There’s nothing wrong with asking for email addresses at the beginning of your homepage. Just make sure it’s done tastefully.
And don’t forget to offer your site visitors an incentive to subscribe.
If you follow the tips I’ve outlined in this guide, you’ll grow your email list while keeping your website visitors happy.
How are you getting website visitors to subscribe to your email list without interfering with their browsing experience?
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Questions About Books, Dogs, Stress, Video Games, and More!
What’s inside? Here are the questions answered in today’s reader mailbag, boiled down to summaries of five or fewer words. Click on the number to jump straight down to the question.
1. Medical debt late in life
2. Three best personal finance books
3. Best use of a raise
4. Books like Wisdom of Frugality
5. Adjusting budgeting methods
6. Annual cost of dog ownership
7. Regular versus Roth?
8. Obsessing over finances actually stress?
9. Buying into stocks right now
10. National health care thoughts
11. Food budgeting difficulty
12. Video games, time, and money
Over the next several months, we’re undergoing a series of minor renovations and room repurposing in our home. My current office is being converted into a child’s bedroom and I’m moving to a corner workspace in our basement. We’re changing around our family room to make it more of a no-screen room oriented toward reading and playing board games and puzzles and such.
This means a lot of moving things around, a lot of little projects, a lot of evaluation of possessions, and so on. Should we keep this? Should we keep that? Where should this go? It’s a pretty time consuming process, one that’s produced more than a few trips to Goodwill.
Yet, somehow, it’s a cathartic process. It feels good to nudge our home in a direction that’s more useful to everyone on the average.
Q1: Medical debt late in life
I am debt free completely after many years of stupidity and now own a modest home. I have read tons of financial books and follow Dave Ramsey and Suze Orman. But the one topic I can’t really find much out about is how to weather a catastrophic health event (short of dying) without wiping out all my savings. And my greatest fear is a hospital somehow seizing my house out from under me leaving me homeless while old and sick. I picture sending giant payments to a cold heartless medical system and scrimping on food and other creature comforts! Maybe you could write an article on this topic. I have told older family members with big medical bills to just pay them $50 a month and continue to enjoy their retirement. But can a hospital find out what assets you have and force you to completely liquidate?? Also I own my home jointly with my longtime boyfriend and we do not plan to marry because he is very unhealthy and I do not want to be stuck with his medical bills. Could a hospital seize my house since he is on the title?? This is a very good topic for your blog maybe. As you can see I am the classic female who fears ending up a bag lady!
– Dana
Quite honestly, the best thing a person can do to avoid this scenario of being elderly and facing huge medical debts is to sign up for Medicare as soon as they’re eligible and then also find some gap coverage that helps pay for the gap between what Medicare covers and what they can afford to pay.
The various parts of Medicare actually do provide pretty solid coverage against extreme expenses, but it doesn’t cover everything. There are often high copays (over $1,000 in some cases) and there are some outpatient procedures that have deductibles that are 20% of the total cost of the procedure.
That’s where gap coverage comes in. It’s usually fairly affordable and provides coverage for the gap between Medicare and what you can actually afford in unexpected events. Basically, gap coverage chops those copays and deductibles down to more manageable numbers.
Another step you should strongly consider, starting in your 50s or even in your 40s, is signing up for a HSA and making annual contributions if your employer offers it. A HSA is a special savings account into which your contributions are tax deductible and, when you take money out and use it for medical purposes, there are no tax penalties. It’s a good way to start saving in your 40s and 50s for things like Medicare copays and deductibles when you reach retirement age.
A final tip is to request itemized medical bills every time you’re supposed to pay for anything out of pocket and make sure that the items on the bill are services you actually received. Coding errors happen more often than you think and those errors often result in you having to pay more than you should.
Q2: Three best personal finance books
I stumbled onto your site while surfing about investing and retirement and found the 52 Personal Finance Books in 52 Weeks article very informative. Does Trent have or if he were forced to make a list of the top three books, which ones would they be? I have read a few of the books and look forward to the reply.
– Andrew
52 Personal Finance Books in 52 Weeks was a series I did early on with The Simple Dollar where I did just that – I read a personal finance book a week for a year and offered up some brief comments on each one. Since then, I’ve easily read 100 more.
So… what are the three best ones?
I still think Your Money or Your Life by Joe Dominguez and Vicki Robin is the best personal finance book out there, all around. It takes a “whole life” perspective to personal finance, recognizing that our financial choices undergird almost every aspect of our life, and tries to guide people to figuring out how to maximize their finances to obtain their best possible life.
If you’re struggling to deal with debt, The Total Money Makeover by Dave Ramsey is amazing. I like it the most of his books because he almost entirely sticks at what he’s good at, which is setting up a simple model for debt repayment and providing firm coaching through that model. I’m less interested in his investment advice, but that’s largely absent in this book, which is where Ramsey really hits his strengths.
For a third… that’s very difficult. I think I’d probably suggest that you find a personal finance book that matches up with your specific situation. Everyone’s situation is different, and different books speak well to different situations.
Q3: Best use of a raise
Lets say you contribute a decent amount to your IRAs and to your regular investments which are both similarly structured portfolios. Let’s say you have no debts and have an emergency fund.
Now if you were to get an extra $1000 or $2000 a year (or more), would you invest it in your IRA for the future, or the investments just in case you need to use it before you hit retirement age? Or what?
– Brian
If I didn’t have any other pressing goals in life, I’d put it into my IRA with the intent of retiring a bit earlier or retiring with a bit more security.
My philosophy is that if you’re investing, it should be done with a goal in mind. A goal can help you figure out things like your risk tolerance and your timeline, both of which will inform what things you’re actually investing in. If you don’t have a goal, you really can’t assess how much risk you can tolerate or whether you should be investing for the short term or the medium term or the long term.
You clearly have one goal – saving for retirement. It’s a goal most people have. Investing for that goal is pretty much never a bad choice. It should really only be trumped when you can clearly articulate a different goal that’s more important to you. Do you have one? If not, sock money away in that IRA!
Q4: Books like Wisdom of Frugality
I absolutely loved the series on Wisdom of Frugality. Hoped you would end it with some suggestions for follow up reads.
– Erin
This seems to be book recommendation week on The Simple Dollar! Here are three books I’ve enjoyed in the last couple of years that would make good follow-ups to The Wisdom of Frugality if you’re looking for a more philosophical view of the challenges of modern life.
Graceful Simplicity: The Philosophy and Politics of the Alternative American Dream by Jerome Segal is probably the best direct follow-up to The Wisdom of Frugality. To me, it carries the ideas in The Wisdom of Frugality to an obvious conclusion: frugality, as a life philosophy, leads to a different formulation of the American dream. What does that look like today? What does that mean today?
A Guide to the Good Life: The Ancient Art of Stoic Joy by William Irvine is a more practical look at applying a philosophical approach to daily life. Here, Irvine looks close at stoicism, a philosophy that The Wisdom of Frugality mentioned many times and that I’ve discussed on The Simple Dollar before as well. Stoicism has been an incredibly powerful part of my life for years.
The World Beyond Your Head: On Becoming an Individual in an Age of Distraction by Matthew Crawford is a bit further off of the path from The Wisdom of Frugality, but it addresses the era of constant distraction that we live in from a very thoughtful perspective. I tend to find that frugality is intimately connected to simple living, and this is a great book on the challenges of living a simpler life in a distracted era.
Q5: Adjusting budgeting methods
My current budget method is about as low-tech as it gets. Each month, I make a list of all the bills I have to pay and write them down on lined paper (this includes a zero-sum budget where the leftover goes to extra student loan payments or a small ‘fun fund’ for the month.) I write down each transaction in its appropriate box or column, deduct it from what I had budgeted in that category, and highlight it pink if it has cleared my checking.
If I used a credit card for that transaction, I record it on the paper, deduct it from what I have left in that category, and then I move that amount from my checking into a “Pay to XYZ Credit Card” savings account (I have several savings accounts set up for this purpose, one for each credit card). I then highlight it orange. This way, the money is set aside and earmarked for the card in a tangible way. I pay each card several times per month. I feel this is an effective way to reap the credit card rewards and it helps me ‘outsmart myself’ from having more cash around than I really ‘have’ to spend.
My issue is this: I am getting married to a wonderful man who is not as diligent about budgeting as I am. He has never had to worry about money much, nor is he a worrier like I am. This method is easy when you have 10 set bills per month and 2-3 variable categories with only about 20 transactions per month. But when you throw in tracking finances for two people across multiple cards and many more variable categories, it becomes almost impossible. If he were willing to hand over 100% of the finances to me I would happily do all the tracking, but he is not interested in that.
My questions are: is there a name for any of my methods that would help me research how people make them work (I see the zero-sum and maybe a bit of the envelope method)? Do you know of anyone who uses this ‘move cash to earmarked account’ strategy? I have tried YNAB but I find it cumbersome with only my own accounts to track, plus it doesn\’t seem to have the features that I can do by hand. Should I give up my old method to get us both on the YNAB bandwagon (or similar software)? Can this dog learn new tricks?
– Lydia
The complexities of tracking expenses for two people (or more) is a difficult challenge. It can be done, but it’s going to easily double the time you’re investing in this and it’s likely going to cause at least some friction with your partner.
My suggestion is to either accept the additional time burden (which seems like it’s untenable to you), switch to a less intense system (like simply reviewing monthly statements), or else switching to a system that’s aided by automation, like Mint or YNAB.
I personally use a system with a bunch of accounts that are earmarked for various purposes using Capital One 360, which allows you to make tons of accounts like this. However, I have all the transfers automated so I barely have to think about it. It just happens almost automatically.
Q6: Annual cost of dog ownership
How much does it cost to own a dog per year? My family is considering getting a dog and I am trying to figure out how much it will cost and the numbers I find on Google are all over the place.
– Charlie
The numbers are all over the place for several reasons. One, how big is the dog? Bigger dogs require a lot more food. Two, how often will the dog require paying someone for outside care, such as walking during the day or care while you’re traveling? Three, how humanely do you intend to treat the dog? What’s the quality of their food? How active do you intend to be with their vet checkups beyond the minimal annual shots? If you’re faced with some stiff vet bills for treatment for a condition, how will you handle it? I’m not going to argue one way or another on issues like this, but it is something to consider when you add a pet to your family.
Those kinds of things change the cost per year of owning a dog drastically. Many people who estimate costs bake in a number of assumptions about those questions. For example, are you feeding your dog a natural foods diet or a 50 pound bag of Ol’ Roy? That’s going to have a drastic difference in cost, but many people who quote a quick dollar figure are going with some assumption about a question like that.
In other words, it’s not an easy question to answer. In general, however, a smaller dog will be less expensive and won’t be as costly to feed and maintain well compared to a large dog.
Q7: Regular versus Roth?
I am married and we filed jointly. We are currently ages 40 and 47. We earn enough pre-tax income to only be eligible for the 2018 tax reform deduction amount of $24,000. Itemization is no longer an advantage based on current combined income. Both my husband and I contribute the max amount to our Roth IRA\’s and are both in a position to max out our contributions to our companies’ 401k’s, both offer employer match. Here’s my question: we have the choice between the traditional 401k and a Roth 401k, or a combination of both with a max annual contribution (currently $18,500) each. What are your recommendations for contributing to the regular 401k vs the Roth 401k? Financially we only have a mortgage as debt (no other debt) and have a healthy savings account balance. We live in Baltimore, MD. We have about 20 years before we plan to retire. Thoughts? Suggestions?
– Jenna
The number one factor when determining whether a person should contribute to a Roth or a Traditional retirement account, whether it’s a 401(k) or an IRA, is whether or not you believe that income tax rates are going to go up from where they’re at right now. If you believe that they are, then you should be contributing to a Roth. If you believe that they’re likely to go down, then you should be contributing to a Traditional.
My belief is that over the next 40 years, income tax rates are going to go up somewhat, thus I usually nudge people toward Roth retirement investments if they’re eligible.
In general, if you have a Roth 401(k) option available to you, I almost universally recommend it over a traditional 401(k).
Q8: Obsessing over finances actually stress?
Wanted to share a theory that focusing heavily on finances is a result of stress. People who worry and stress about life are more likely to obsess over their finances. Thoughts?
– Alvin
For me, at least, I found that the stress around money slowly grew for years and years until I reached a critical point and actually started to pay attention to what I needed to do to straighten out my finances, and from that peak my stress related to finances and career has gone down steadily.
Having said that, I think there is a connection, at least to that initial “switch” that gets people to start focusing on their finances. I think that there comes a point for many people where the stress of stumbling through life financially forces them to change their habits in some fashion. For some, that might come off seeming like a money “obsession,” at least for a while.
I think it is deeply stressful to continually live a life on the financial precipice, and financial management can be a way to help yourself deal with that stress.
Q9: Buying into stocks right now
I have 100,000 dollars in my savings account. my wife and I both max out our 401ks every year. We’d like to start start getting a VTSAX started. But is it a bad time to buy in?? I keep hearing there is some huge market correction for everything happening soon. Should I just wait for that to start ?? OR do I just say f[orget] it and START!?!?
– Dan
I’m assuming that you’re wanting to move some of that $100,000 in cash into VTSAX (the Vanguard Total Stock Market index fund).
My first question to you would be what your goal with this money is. What do you intend to do with it? Are you sitting on it for an emergency? Is it to eventually buy a home? Is it for early retirement? How far off do you think that goal is? The big reason here is that, as mentioned earlier, without a clear goal, you can’t establish a clear timeline for your investments, and without that timeline, you can’t really figure out what investment option is best. The stock market is always volatile, with big gain years mixed in with zero gain years and years with losses. On average, that adds up to a nice average annual return, but a 25% return one year and a 15% loss the next year averages out to a 5% annual return, which looks good, but what if you’re only in it for one year? Will it be the +25% year or the -15% year? That’s why goals and timelines are so vital.
I’d suggest sitting down and figuring out why you’re investing this money, what you’re aiming for, how far off it is, and how much risk you can stomach (in other words, do things go really bad if you lose 40% of your investment in the year before you want to tap it?).
If you do decide to go into stocks, don’t waste a second worrying about timing the market. It’s impossible for an individual investor to time the market with enough accuracy to make up for the time spent out of the market. Individual investors are virtually guaranteed to miss the peak and also miss the bottom, and when you’re off of those by even a few percentage points, you aren’t really gaining anything by the timing, and if you miss by more than that, you’re probably losing money in the timing. Don’t bother. Invest now and keep investing until you have a non-market reason to change things.
Q10: National health care thoughts
Do you think there should be a national health care system like in the UK where people can just go to the doctor and receive medical care without being billed and everyone just pays higher taxes to cover the whole cost?
– Diana
First of all, let me be clear in saying that my main interest in The Simple Dollar is addressing the real financial issues that people face right now. Rather than looking at what might be, I’m interested instead in helping people with the situation they actually have, right now.
The idea of getting perfect health care without a bill and having it paid for by “taxes” that you’re not directly responsible for outside of what’s stripped out of your check each pay period sounds great, but the devil is in the details, and it is in those details where the real challenge lies. This is not a simple question to be answered, just like every other issue of any importance, and if we try to reduce it to a ten second sound bite or a “yes” or “no” answer, we do ourselves a grave disservice.
There is good conversation and debate to be had about health care, but it’s very difficult to find this conversation in an angry world where you have to quickly align with one team or another and you’re immediately angry with anyone who disagrees with you. That’s not helpful to anyone, in my opinion.
Instead, I’m going to stick with helping people get the most out of their dollars (and their life) today, with the system we have today. My own ideas about what kind of system we should have are my own and basically irrelevant to the cause of helping people get the most out of their dollars today.
The one thing I ask is to not label someone who disagrees with you as “the enemy” or some other negative label without having some kind of substantive conversation with that person. Ask questions and listen and figure out what that person really stands for.
Q11: Food budgeting difficulty
What I’m curious to see is a 30-day challenge (or more) where you have to radically change your diet and eating style to see how it effects your budget. An example here would be imagine a member of the family is diagnosed with a bowel disease, like colitis, where a radical change in diet is necessary. Sticking to a low FODMAP diet changes the dynamics of both meal planning and budgeting. Do it for a month and write up an article! Or maybe pick a gluten-free and dairy-free diet to simulate one family member with lactose intolerance and another Celiac’s. I’m suggesting this challenge because I’ve yet to find a personal finance site actually tackle these challenges that part of the population has to live with on a daily basis. Many articles mention ways to save money when preparing meals, but when you have really hard dietary restrictions, it’s tough. Show your readers that it’s not easy!
– Alexandra
Personally, I eat a vegetarian diet that’s about 80% vegan and 20% vegetarian, and I eat fish on rare occasion. I usually describe myself as vegetarian but think of myself internally as “flexibly vegan.” I do so for health reasons. My family does not follow the same diet – they do eat some vegetarian meals, but many meals here have meat as a main course where I cook veggies or something like that. My wife is about 99% vegetarian at this point. Also, one close friend of my children has a disease that requires a gluten-free diet and we make meal choices to accommodate that friend.
Anyway, when you put that big of a blanket restriction on your diet, it does impact how you can shop for food. You look at the grocery store flyer and there are simply a lot of options in there that you’re not buying, and because of that, you can’t chase bargains very much at all. It’s hard.
What I do in my situation is simply understand what I can’t eat, then cross off those items when I’m planning meals. If there’s meat in the grocery store flyer, I ignore it (unless it’s for a main course for guests or other family members).
My general meal planning structure is to plan about seven to ten days of meals at once. I start with our calendar and the grocery store flyer and figure out what time and logistic restrictions we have on meals, then use the flyer to figure out what ingredients are on sale that can make meals that fit those time and logistic restrictions. The addition of dietary restriction jumps in here, causing me to cross off many items in the grocery store flyer. I then try to pencil in meals centered around the remaining uncrossed items from the flyer.
This basic procedure is true for almost any dietary restriction. Yes, some are more strict than others and will eliminate a lot of foods, but there’s almost always a few things in most grocery store flyers that match up with what a person can eat. Start with those as your foundation for meal planning for the week.
Q12: Video games, time, and money
I am 48 years old, my husband is 47. We converted our basement into an apartment for our son so he could live rent free while he’s working until he can afford to buy a house, and the rent is free as long as he has a job or is spending 8 hours a day looking for one. When he’s working, we do charge him “rent” which we put aside in savings for a house down payment for him. He contributes to the food and the utilities here too. He has a good job so that’s not a problem and he is saving for a house.
The problem is that with the remainder of his money, he buys lots of video games. He comes home from work and plays video games for 3-4 hours in the evening and rarely leaves the house. He spends hundreds a month on his games.
What can we do to nudge him in a better direction?
– Alison
While he could, of course, be more productive with his time, I actually don’t think he’s in as bad of a place as you think. The average American watches five hours of television a day. If he’s simply eliminating the TV time and replacing it with video game time, he’s probably not far off of the American average.
As for the cost, the average American cable bill is $103 per month. If he buys two new releases a month and doesn’t pay for cable, that, again, is about the American average. (There are ways to be really frugal with video gaming as a hobby, too, so it’s likely he’s not even spending that much.)
In other words, my feeling is that if he’s holding down a good job and seems relatively happy with it, I wouldn’t stress about this too much. He’s probably trying to figure out how to adjust to having a real job, with all of the stresses that it brings into his life.
My approach, if I were in your shoes, would be to talk about goals at the dinner table with him like you’re adults, not as a parent to a child. Talk openly and frankly about the goals you and your partner have over the next ten to fifteen years, just as if he’s another adult you care deeply about, like a sibling you’re still close to or your best friend. Then just ask him where he thinks he’ll be at that point. Then, without pressuring him, slide back into talking about how you’re going to get from where you’re at to where you want to go – your plan for achieving your goal. Don’t push him even one little bit. Just let the obvious questions take seed in his mind.
Don’t make this an “every dinner” thing. Just nudge that topic there once a week or once every other week or so, especially if you’ve hit some milestone on your journeys in life. How does that milestone relate to where you want to go? What things did you do to get there? Hit upon those things, but make it a natural conversation that’s as much with your partner as with your kid. You are adults talking about life, not a parent instructing a kid. Let him form his own ideas and draw his own conclusions.
That’s how I’d handle it, anyway. Don’t force anything unless he’s obviously going off the rails, and playing video games in the evening while holding down a good job and saving for a down payment is pretty much the opposite of “going off the rails.”
Got any questions? The best way to ask is to follow me on Facebook and ask questions directly there. I’ll attempt to answer them in a future mailbag (which, by way of full disclosure, may also get re-posted on other websites that pick up my blog). However, I do receive many, many questions per week, so I may not necessarily be able to answer yours.
The post Questions About Books, Dogs, Stress, Video Games, and More! appeared first on The Simple Dollar.
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We Found The Easiest Way to Budget for When Nothing Else Is Working
But just as people have different spending personalities, there are different budgeting personalities, too. And that means many popular budgeting styles aren’t for everyone.
If you have irregular income or fixed expenses, a zero-based budget can be complicated.
If you’re not good at tracking all your expenses, the 50/20/30 budget might be too restrictive.
But there’s also a simple method in the middle that can be great for a beginning budgeter, and it’s the simplest to alter if none of the above work for you: the 60% solution.
How the 60% Solution for Budgeting Works
Coined by Richard Jenkins, author and former editor-in-chief of MSN Money, the 60% solution splits your budget into two sections and doesn’t require any expense tracking.
Jenkins developed it after he reviewed two decades of his spending. He found that the times he felt most financially secure were not when he was earning a certain amount, but when he was spending under a certain percentage of his income.
When his “committed” expenses — that is, necessities, plus nonessentials you’ve committed to — were within 60% of his income, he felt more in control of his money.
Jenkins includes his kids’ music lessons and sports dues in his committed expenses, but you might include a gym membership or professional group. Other commitments include:
- Basic food and clothing.
- Essential household expenses.
- Insurance premiums.
- Bills, both essential and discretionary.
- Taxes, such as property, capital gains or income tax if you’re self-employed.
If your committed expenses exceed 60% of your income, you might need to start looking for places to cut back.
Jenkins stresses that 60% isn’t the magic number, but it’s a round number that’s easy to remember, and it works for him. You can adjust the percentage to work for you and your financial goals.
What About the Other 40%?
Jenkins divides the last 40% into 10% increments. He keeps his savings in the best places for him, but I’ve included my recommendations on where most people will want to keep their money:
- 10% to retirement savings in your 401(k) or IRA.
- 10% to long-term savings in a taxable investment account, meaning you can access the money within three days but will only withdraw from the account once every few years. This allows interest to compound and make you more money. It includes your emergency fund for things like medical bills and savings for planned purchases like cars.
- 10% to short-term savings in a high-yield savings account that you can instantly access or use to transfer money to your checking account via the web. This is for more frequent, unplanned needs like repairs, as well as vacations and holiday gifts.
- 10% to fun money that you can spend on anything as long as it doesn’t exceed 10% of your income.
If you put 30% of your income toward savings, you’re way ahead of the average American — who saves less than 5% — but it’s well worth it when you’re trying to build your financial foundation.
If you’re making $40,000 per year, then your take-home pay, depending on your filing status and allowances, is roughly $2,800 per month.
That equates to $1,680 for committed expenses and $280 toward each saving and fun category.
Here’s what $280 per month can get you:
- $265,000 in your Roth IRA after 30 years at 6% interest. That’s over $164,000 in growth!
- A paid-for $15,000 car in just over four years.
- A $2,000 vacation every year with $1,300 left over for unplanned expenses.
- A $280 sushi budget. Every. Single. Month. (Priorities.)
Sounds like it’s worth cutting back some of those committed expenses, right?
If that’s too hard right now, you can easily alter the 60/40 ratio to meet you where you are. Increasing your savings categories, lowering unnecessary expenses or cutting your fun money are all moves in the right direction.
Regardless of how you define your percentages, there’s one thing that makes or breaks a budget: your ability to say “no.”
So whatever your budget, remember you’re in control of whether you spend within it.
Jen Smith is a staff writer at The Penny Hoarder. She gives money-saving and debt payoff tips on Instagram at @savingwithspunk.
This was originally published on The Penny Hoarder, which helps millions of readers worldwide earn and save money by sharing unique job opportunities, personal stories, freebies and more. The Inc. 5000 ranked The Penny Hoarder as the fastest-growing private media company in the U.S. in 2017.
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