Personal Finance Blog for Retirement and Investment Advice

Four Helpful Tips for Keeping New Year’s Resolutions to Spend Less and Save More

It probably won’t come as a surprise that the two most common New Year’s financial resolutions are to save more money… and to spend less.

And it also should come as no surprise that most New Year’s resolutions have been abandoned by Valentine’s Day – if not sooner!

So I thought this would be a great time to give you some tips to help you stick with it.

Let’s start with tips for spending less money because if you don’t spend less, it’s very difficult – or impossible – to save more.

Tip #1 for Curbing Spending: Get the Right Budgeting Program

I know, I know! The moment many people even hear the word “budget,” they get turned off because the word conjures up “deprivation,” just like the word “diet.” But hear me out…

There are a gazillion budgeting apps and programs, so how do you know which one will proactively help you avoid spending decisions that are not in your best interests… unlike the typical programs that show you – after the fact – that you blew your budget last month on something that will soon be forgotten?

That’s where “You Need a Budget” comes in.

The folks at You Need a Budget (“YNAB”) claim users save an average of $600 by the second month and over $6,000 per year. But I have some close friends who have saved far more than that – without feeling deprived one bit! They say it’s truly changed their lives and decades of bad habits.

YNAB is different from other apps in that it’s set up to enable you to prioritize and plan, so you have money for the things that are most important to you – whatever they are.

It makes you conscious about your spending – before you spend. Most programs and apps make you aware of your spending AFTER you’ve spent the money and it’s too late to change your behavior.

So watch the one-minute video overview and then take advantage of the free 34-day YNAB trial here today.

Tip #2 for Curbing Spending: Learn the Art of “Sparking Joy”

Is it possible that a system for decluttering can be life changing?

From my own personal experience and that of my friends, I can tell you the answer is a resounding “yes!” The simple system described in Marie Kondo’s book, The Life-Changing Magic of Tidying Up, will help you more easily deal with clutter and disorganization. And it will help you avoid lapsing back into the bad habits that trap you into an energy-sapping cycle.

The unexpected bonus of the Magic of Tidying Up is that it helps you put a stop to purchases that seem like “must haves” in the moment, but typically end up gathering dust.

And now, here are two tips for saving more money…

Tip #1 for Increasing Savings: Incremental Increases Add Up

Setting a goal that’s not very realistic can easily end up making you feel discouraged. If you resolve to increase your savings by 7% this year, for example, but you often find yourself with “more month than money,” you could be setting yourself up for failure.

What if you resolved instead to increase your savings by 2% this (and every) year? You won’t feel the pinch, and you’ll be surprised how quickly your savings will grow.

Tip #2 for Increasing Your Savings: Save More Where Your Money is Guaranteed to Grow

As we approach the 11th birthday of the longest-running bull market in history, it’s easy to feel you have to plow everything into the market, due to “FOMO” – or Fear of Missing Out.

But those of us who recall what it feels like to lose 50% or more of our life’s savings (which happened TWICE in the last 20 years), and then have it take ten or more years to recoup our losses, don’t want to make the mistake of putting most or all of our eggs in the Wall Street Casino basket again.

We often hear from people who’ve added the Bank On Yourself safe wealth-building strategy to their financial plan how much more fun and motivating saving money is  when you don’t have to worry about losing your hard-earned money when the market crashes or the economy experiences a rough patch.

They sleep well knowing the Bank On Yourself strategy has NEVER had a losing year in more than 160 years.

It enjoys growth that’s significantly greater than savings or money market accounts and CDs.

And it gives you unmatched flexibility and control of your savings as well as some juicy tax advantages.

Your money grows tax-deferred, and you can take a tax-free income in retirement, under current tax law.

You won’t get rich overnight with Bank On Yourself, but you also won’t be subject to the stomach-churning ups and downs of stocks and other volatile investments.

You’ve heard the phrase “slow and steady wins the race.” Saving for retirement is a marathon, not a sprint. Marathoners are still in the race long after the sprinters have fallen by the wayside.

How to Set Yourself Up for Your Best Year Yet… and a Lifetime of Financial Security…

Don’t you owe it to yourself to find out how to add guarantees, predictability and flexibility to your financial plan in 2020?

You can find out the bottom-line numbers and results you could get if you added the Bank On Yourself safe wealth-building strategy to your financial plan before you decide if it makes sense for your situation.

Just request a free Analysis now – while it’s fresh on your mind. There’s no obligation, and you’ll get a referral to one of only 200 Bank On Yourself Authorized Advisors in the U.S. and Canada who can answer any questions you have.

But please don’t put it off even one more day. You have a lifetime of financial security to gain, so click here to take the next step:

3 Reasons Why the Money in Your 401(k)/IRA Doesn’t Belong to You

If you get regular account statements, you probably know the approximate current value of your 401(k) and/or IRAs, so please write that total down now.

Do you think all that money belongs to you?

It doesn’t… and what people find most surprising is how little of your account value actually does belong to you.

3 Reasons the Money in Your 401(k) Doesn’t Belong to You…

Reason #1: You May Not Be Fully Vested

[Read more…] “3 Reasons Why the Money in Your 401(k)/IRA Doesn’t Belong to You”

Conscious Spending: How to Live a Richer Lifestyle Without Busting Your Budget

Ben Simon, a college student at the University of Maryland, founded an organization called the Food Recovery Network that organizes campus dining halls to donate left over food to hungry Americans. Ben noticed how many billions of tons of food are wasted each year by restaurants, caterers and other food providers.

He believes that, especially in this country, we don’t need to produce more food to see that everyone is fed. We simply need to stop wasting the food we have.

And so it is with many of us and our money.

Rather than increasing the speed of our hamster wheel to make more money, most of us would do well to figure out how to waste less.

Too many of us spend on items that give us very little in return: no lasting satisfaction, joy, or value

[Read more…] “Conscious Spending: How to Live a Richer Lifestyle Without Busting Your Budget”

The Wall Street Journal Podcast Interview with Pamela Yellen: The Biggest 401(k) Mistake People Make

I was just interviewed again by the Wall Street Journal for an episode of their “Your Money Briefing” podcast.

The episode is described as, “Financial security expert Pamela Yellen explains why employees should take control of their 401(k) retirement investments and not rely on their employer to invest for them.”

In this eye-opening interview I discuss:

  • Why it’s very likely that your 401(k) money is in a Target Date Fund (TDF) – even if you didn’t authorize it or request it – and three reasons that should concern you
  • 98% of all employers use TDFs, and 90% have it as the “default option,” which means they automatically put your money there unless you specifically direct them to do otherwise – and almost no one does
  • Near retirement? You’re not protected! TDFs are supposed to dial back risk as you near retirement, but in practice, that hasn’t happened. In 2008, some TDFs designed for participants expecting to retire in two years lost as much as 40%!
  • How the shockingly high fees of TDFs devour your hard-earned savings
  • The dangers of having your retirement savings in a one-size-fits-all financial vehicle
  • How to quickly and easily do your own research to compare the mutual fund options your 401(k) offers
  • How to protect your retirement savings from market volatility and ensure a guaranteed income for life

[Read more…] “The Wall Street Journal Podcast Interview with Pamela Yellen: The Biggest 401(k) Mistake People Make”

Can You Answer This Critical Question About Your Retirement Plan? (Most People Can’t)

Here’s the most critical question you must be able to answer about your retirement plan…

Do you know what your retirement account(s) will be worth on the day you plan to tap into them?

If you’re saving for retirement the way most people do, you couldn’t answer this question if your life depended on it!

And When You Get Right Down to it, Your Life Does Depend on it!

Here are three reasons why… [Read more…] “Can You Answer This Critical Question About Your Retirement Plan? (Most People Can’t)”

The Wall Street Journal Podcast Interview with Pamela Yellen: Why You Won’t Work as Long as You Planned

I was recently interviewed by the Wall Street Journal for an episode of their “Your Money Briefing” podcast.

The episode is described as, “Financial security expert Pamela Yellen explains why most people stop working earlier than planned, and offers safe investment tips to reduce the chances of running out of money in retirement.”

In this interview I discussed: [Read more…] “The Wall Street Journal Podcast Interview with Pamela Yellen: Why You Won’t Work as Long as You Planned”

Retirees Will Outlive Their Savings by 10 Years, According to a New Study by the World Economic Forum

The typical 65-year-old has only enough savings to cover 9.7 years of retirement income. That leaves the average American man with a gap of 8.3 years, and women (who live longer) face a 10.9-year gap with no savings left.

That’s according to a scary new study by the World Economic Forum. This assumes you live an average lifespan. If you’re one of the “lucky” ones who lives longer, you could outlive your money by 20 to 25 years or more.

6 Challenges You Face that Could Turn Your Retirement Dreams into a Retirement Nightmare…

How many of these challenges have you prepared for?

Challenge #1: The typical household nearing retirement has an average of only $135,000 in their combined retirement accounts – enough to provide at most $600 per month income. (Source: Federal Reserve Survey of Consumer Finances)

Challenge #2: Even healthy couples will face extreme health care costs in retirement. [Read more…] “Retirees Will Outlive Their Savings by 10 Years, According to a New Study by the World Economic Forum”

Retirement Can Be Fantastic … If You’re Prepared

What do you think of when you think of retirement? Freedom? Enjoyment? Less stress?

You’re not alone. Most workers today associate retirement with those concepts, according to What Is “Retirement”? Three Generations Prepare for Older Age, the latest study from the nonprofit Transamerica Center for Retirement Studies.

But the big question is … Will You Be Ready?

Will You Be Healthy Enough to Retire the Way You Hope To?

Just 16% of Baby Boomers surveyed said their health is “excellent.” But only about half of the workers in the survey said they exercise regularly … or eat healthfully … or get enough sleep.

Here’s the issue, as laid out bluntly by life coach Peter Sage …

If you don’t make time for health, you’ll have to make time for illness.”

How successful at life can you be, when your body refuses to serve you? And it will eventually refuse to serve you if you ignore your health.

Will You Have Enough Money to Do What You Want to Do?

Two out of three workers say their big retirement dream is travel. Half of those surveyed said they’re looking forward to spending time with their family and friends. And nearly half get a smile on their faces when they think of the time they’ll have to pursue their hobbies.

The problem is this: half of those surveyed have less than $50,000 total in all their household retirement accounts.

How far will $50,000 take you? [Read more…] “Retirement Can Be Fantastic … If You’re Prepared”

There’s a Good Chance You May Be Forced to Retire Sooner Than You Expect

Perhaps you’ve heard that the best way to make God laugh is to tell him your plans. … Particularly your plans for retirement!

And you’ve probably heard that with the unpredictability of the markets – stocks, bonds, real estate, whatever – you’re going to need to work longer than you had planned, in order to have enough to live on in retirement.

But that doesn’t mean the universe will cooperate.

Research from the Center for Retirement Research reveals that on average 21 percent of workers intend to work to age 66 or later. But more than half of them fail to reach this target.

The share of workers who say they expect to work past age 65 rose from 16% in 1991 to 48% in 2018. But the study shows that 37 percent of all workers end up retiring earlier than they had planned.

How can this be?

Why Are Hard-Working Americans Retiring Earlier Than Planned?

[Read more…] “There’s a Good Chance You May Be Forced to Retire Sooner Than You Expect”

Many Stock Market Investors Haven’t Kept Up With Inflation Over the Last 20 Years – DALBAR 2019 Report

What kind of return would you have to get in the stock market to make it worth the risk and gut-wrenching ups and downs?

Would you put your life’s savings at risk for a 5% annual return?

Or would you require at least a 7% return?

Or maybe even a 10% annual return?

If you’re like most people we’ve surveyed, you wouldn’t do it unless you thought you could get at least a 7% annual return over time, right?

Here’s the Harsh Reality of the Actual Returns Investors Are Getting…

I hope you’re sitting down because this is going to floor you: According to a new study, the typical investor in equity mutual funds has gotten only a 3.88% annual return… over the last 20 years!

But it’s actually much worse than that. Here’s why… [Read more…] “Many Stock Market Investors Haven’t Kept Up With Inflation Over the Last 20 Years – DALBAR 2019 Report”