What Does It Take To Get Rich?
.What Does It Take To Get Rich?
Hillary Hoffower Dec. 29, 2018
A researcher who studied more than 600 millionaires found the same 2 qualities helped them get rich
According to a researcher who studied more than 600 millionaires, to build wealth, you need two qualities: resilience and perseverance.
These qualities are characteristics of those who can afford to retire early and entrepreneurs who become self-made millionaires.
It takes conscious effort to develop resiliency and perseverance.
What does it take to get rich?
It may seem like building wealth is impossible, but it takes two qualities that anyone can develop to do it: resilience and perseverance.
That's according to Sarah Stanley Fallaw, coauthor of " The Next Millionaire Next Door: Enduring Strategies for Building Wealth" and the director of research for the Affluent Market Institute.
What Does It Take To Get Rich?
Hillary Hoffower Dec. 29, 2018
A researcher who studied more than 600 millionaires found the same 2 qualities helped them get rich
According to a researcher who studied more than 600 millionaires, to build wealth, you need two qualities: resilience and perseverance.
These qualities are characteristics of those who can afford to retire early and entrepreneurs who become self-made millionaires.
It takes conscious effort to develop resiliency and perseverance.
What does it take to get rich?
It may seem like building wealth is impossible, but it takes two qualities that anyone can develop to do it: resilience and perseverance.
That's according to Sarah Stanley Fallaw, coauthor of " The Next Millionaire Next Door: Enduring Strategies for Building Wealth" and the director of research for the Affluent Market Institute.
A follow-up to the 1998 bestseller " The Millionaire Next Door," written by her father, Thomas J. Stanley, and William D. Danko, the book provides updates and new studies on Stanley's original research on millionaires. Stanley Fallaw's findings are based on a survey of more than 600 millionaires in America conducted between 2015 and 2016.
"To build wealth, to build one's own business, to ignore critics and media and neighbors, you must have the resolve to keep pursuing your goals past rejection and pain," Stanley Fallaw wrote.
She added: "Millionaires and other economically successful Americans who pursue self-employment, decide to climb the corporate ladder, or strive to create a financial independence lifestyle early do so by perpetually pushing on."
To continue reading, please go to the original article here:
https://www.businessinsider.com/qualities-that-help-build-wealth-resilience-perseverance-2018-12
13 Money Goals To Improve Your Finances For Good
.13 Money Goals To Improve Your Finances For Good
Personal Finance - Millionaire Mob - June 6, 2019
These crucial money goals will set you off on the right track with your personal finances… for good once and for all.
13 Money Goals To Improve Your Finances For Good
Here’s the reality. A lot of want to improve our finances but many of us don’t know how to do it or don’t even know where to start.
Believe it or not:
Improving finances starts with having money goals and working through steps to reach those goals. For example, if your goal is to be a doctor, you need to get your college degree, go to medical school, get the training you need, pass the medical board exam, among others.
If you’re one of those people with money goals, kudos to you. You’re one step ahead of many people. If you don’t have money goals yet, don’t worry there is still time to make those.
That time is now.
A lot of us have money goals in mind. Some would like to increase their wealth (i.e., become rich fast) in a few years, some would want to buy a car or a house, and some want something else.
This post will exactly detail some of the money goals you could get inspiration from. Better yet, you can literally use these goals and call them your own.
13 Money Goals To Improve Your Finances For Good
Personal Finance - Millionaire Mob - June 6, 2019
These crucial money goals will set you off on the right track with your personal finances… for good once and for all.
13 Money Goals To Improve Your Finances For Good
Here’s the reality. A lot of want to improve our finances but many of us don’t know how to do it or don’t even know where to start.
Believe it or not:
Improving finances starts with having money goals and working through steps to reach those goals. For example, if your goal is to be a doctor, you need to get your college degree, go to medical school, get the training you need, pass the medical board exam, among others.
If you’re one of those people with money goals, kudos to you. You’re one step ahead of many people. If you don’t have money goals yet, don’t worry there is still time to make those.
That time is now.
A lot of us have money goals in mind. Some would like to increase their wealth (i.e., become rich fast) in a few years, some would want to buy a car or a house, and some want something else.
This post will exactly detail some of the money goals you could get inspiration from. Better yet, you can literally use these goals and call them your own.
If you are onboard and ready to make changes to your finances, read on!
1. Create a Budget. Period.
One of the best things you need to do to start improving your finances is to create a budget. Yes, creating a budget is one of your money goals.
Here me out on this.
No matter how small or big your money goal is, without a budget, that goal may not be achievable or may be hard to achieve, to say the least.
Why?
Because you don’t have a way to track your finances or income and expenses.
When you jot down and detail your finance, you know exactly where your money is going.
Does the benefit of a having a budget stop there? No, not at all.
When you consistently budget and track what’s coming in and going out, you’ll eventually identify which expenses are excessive, which ones you may need cut or adjust, and which ones you don’t need anymore.
When you identify these, you can make adjustments and put the savings towards your bank account, investments, or some other important expenses.
But there’s more:
When you have a budget, you will be able to identify if your expenses exceed your income.
If or when you’ve identified that your expenses exceed your income and need money urgently to fill the gap and/or save some more, you could make a tweak on your expenses or get a side hustle or two to make extra cash and improve your income.
This is where Personal Capital comes into play. It’s a free budgeting app that allows you to monitor your cash flow and income in real-time.
2. Always Check Your Credit Score
If you want to improve your finances, one of the money goals is to always check your credit score.
No kidding you credit score or credit can make or break your finances. A lower credit score may mean you won’t be qualified for better interest rates on loans and other forms of debts. Also a lower score may mean that a lot of companies won’t extend credit to you.
Believe it or not, some employers also require that you allow them to check your credit score especially if you are applying for a job that involves managing finances.
Your credit score provides creditors a way to see your financial health and capability. A high credit score means that you manage your credit well. A low score could be a red flag and your potential creditors may or will question your dependability.
Checking your credit score carries additional benefits.
By checking your credit report, you can assess if all your credit information is correct and accurate. A mistake in your credit can negatively impact your score.
Worse, you could be liable to pay any loan, credit card, and other debts that were opened in your name even when those aren’t really yours to begin with.
To continue reading, please go to the original article here:
The Beggar’s Guide to Getting it Together
.Begging for Money: The Beggar’s Guide to Getting it Together
By Melissa @ Perfection Hangover
Has begging for money become the new norm? It seems that the internet has become an easy way for people to become online panhandlers. I’ve shared many ways to make extra money from home, online, and even creative side hustle ideas (ie “Dave jobs” for all of you Dave Ramsey fans).
From Cyber Beg to Begging Money, there’s no shortage of sites available to ask strangers for financial help.
But at some point, you have to get your financial shit together and take responsibility for your own successes and failures.
Here are five ways to get it done.
Step 1: Evaluate your Income
Do you make enough money to support yourself, your partner, and/or your kids? According to the US Census Bureau, median household income was $61,372 in 2017. Income is calculated including wages and salaries, as well as any kind of governmental entitlement such as unemployment insurance, disability payments or child support payments received, along with any personal business, investment, or other recurring sources of income for all persons over the age of 15 in the household (whether related or not).
If you aren’t currently earning enough money, find ways to make extra cash, such as starting an online business or donating blood plasma for up to $400 per month.
Begging for Money: The Beggar’s Guide to Getting it Together
By Melissa @ Perfection Hangover
Has begging for money become the new norm? It seems that the internet has become an easy way for people to become online panhandlers. I’ve shared many ways to make extra money from home, online, and even creative side hustle ideas (ie “Dave jobs” for all of you Dave Ramsey fans).
From Cyber Beg to Begging Money, there’s no shortage of sites available to ask strangers for financial help.
But at some point, you have to get your financial shit together and take responsibility for your own successes and failures.
Here are five ways to get it done.
Step 1: Evaluate your Income
Do you make enough money to support yourself, your partner, and/or your kids? According to the US Census Bureau, median household income was $61,372 in 2017. Income is calculated including wages and salaries, as well as any kind of governmental entitlement such as unemployment insurance, disability payments or child support payments received, along with any personal business, investment, or other recurring sources of income for all persons over the age of 15 in the household (whether related or not).
If you aren’t currently earning enough money, find ways to make extra cash, such as starting an online business or donating blood plasma for up to $400 per month.
There are so many ways to bring in extra money that there are literally no excuses worthy of holding you back. You just have to make the decision to hustle. Work nights and weekends if you have to. Work two jobs if you need to. Go back to school if it will improve your financial situation.
Step 2: Start Budgeting Every Single Time You Get Paid
Many times, financial problems are the result of overspending and improper budgeting (or worse, failing to budget at all). Budgeting is so important, especially if you are an impulse buyer.
You don’t need fancy planners or complicated spreadsheets to create a budget. I use this cheap family and finance bill organizer from Dollar General (and have used it for years) to keep track of my budget.
Best Budgeting Apps
If budgeting with pencil and paper isn’t your jam, using apps or spreadsheets can be a great way to track spending. The Balance put together a list of the best budgeting apps available to help you track your income and expenses.
Here they are:
By creating a written plan for your money every single time you are paid, you’ll be able to set realistic financial goals as well as expectations for your spending.
To continue reading, please go to the original article here:
https://themoneymix.com/begging-for-money-the-beggars-guide-to-getting-it-together/
For additional articles from Melissa, her website is
7 Mistakes Six-Figure Earners Make
These Are The 7 Mistakes Six-Figure Earners Make
By Clint Haynes
Earning a six-figure salary can make building wealth easier, but it’s not a magic solution for your financial woes. Earning a high income is only one part of the equation. If you want to be financially secure, you need to make your money work for you.
A high paycheck can make it easy to gloss over financial mistakes since you can still cover your bills. However, if you want to build wealth rather than an inflated lifestyle, you need to focus on reaching your full financial potential.
Most of the mistakes that six-figure earners make are easy to fix. Here’s how to use that high income to your advantage and build your net worth.
These Are The 7 Mistakes Six-Figure Earners Make
By Clint Haynes
Earning a six-figure salary can make building wealth easier, but it’s not a magic solution for your financial woes. Earning a high income is only one part of the equation. If you want to be financially secure, you need to make your money work for you.
A high paycheck can make it easy to gloss over financial mistakes since you can still cover your bills. However, if you want to build wealth rather than an inflated lifestyle, you need to focus on reaching your full financial potential.
Most of the mistakes that six-figure earners make are easy to fix. Here’s how to use that high income to your advantage and build your net worth.
7 Six-Figure Money Mistakes
Mistake #1: Not Using A Budget
Just because you have a lot of money coming in every month doesn’t mean you shouldn’t keep track of where it’s going. This makes it easy to squander your paycheck without making any financial progress.
Creating a budget doesn’t have to be hard. Think of it as your spending plan. Make a list of all monthly expenses and use it to create your budget. Does your spending in each category align with your values? Can you cut back or cut out any expenses?
Certain expenses such as eating out or groceries can get out of hand if not kept in check. Cut back on these areas by cooking more at home and shopping smart. You can still have fun with no regrets when you know you’re sticking to your budget.
Review your accounts for subscriptions you are not using and cancel them. Look at your other expenses and think about ways you can cut back with little sacrifice. It may surprise you how spending can escalate when left unchecked.
Make sure to track your spending so you know where your money is going every month. Just because you can pay your bills every month doesn’t mean that it justifies your spending. Every dollar you invest instead of spending sets you up for a better financial future.
Mistake #2: No Long-Term Financial Plan
Having a long-term plan is an important part of setting yourself up for financial success. Making a six-figure income won’t mean much if you lose your job or if you don’t save enough for retirement.
If you want to continue to enjoy the lifestyle that your high income provides, you need to get your retirement plan on track. Having a financial blueprint will give you peace of mind since you know what financial moves you need to make to ensure your success. It will also help you align your finances with your long-term goals and values.
It also means you know how to invest your future dollars so you can maximize returns. Make sure to involve your spouse in all future financial plans so you can get on the same page. Figure out what is important to both of you, such as paying for your kids’ education, saving for retirement, buying another property, and aligning your spending with your goals.
To continue reading, please go to the original article here:
When Lying to Yourself Pays Off
.When Lying to Yourself Pays Off
By Charlotte Cowles
The Cut’s financial advice columnist Charlotte Cowles answers readers’ personal questions about personal finance. Email your money conundrums to mytwocents@nymag.com
Some depressing (but unsurprising) news for optimists: We are delusional. Things generally take longer, cost more, and have a higher chance of going awry than we think they will, and there’s not much we can do about it.
We should probably know better than to cling to our unrealistic expectations, but somehow we never learn. This persistent phenomenon (known as optimism bias) afflicts about 80 percent of humans, according to Tali Sharot, a neuroscientist at University College London.
While optimism has its benefits, it’s not exactly great for financial planning. It causes people to underestimate the likelihood that they’ll experience expensive, commonplace setbacks like injury, market downturns, or a leak in the roof.
Almost all entrepreneurs test high for optimism — and most of their businesses fail. And on a larger scale, optimism bias can cost billions: A Harvard study of 33 countries found that most government agencies were overly confident in their budget planning, particularly when times were flush, resulting in large deficits.
When Lying to Yourself Pays Off
By Charlotte Cowles
The Cut’s financial advice columnist Charlotte Cowles answers readers’ personal questions about personal finance. Email your money conundrums to mytwocents@nymag.com
Some depressing (but unsurprising) news for optimists: We are delusional. Things generally take longer, cost more, and have a higher chance of going awry than we think they will, and there’s not much we can do about it.
We should probably know better than to cling to our unrealistic expectations, but somehow we never learn. This persistent phenomenon (known as optimism bias) afflicts about 80 percent of humans, according to Tali Sharot, a neuroscientist at University College London.
While optimism has its benefits, it’s not exactly great for financial planning. It causes people to underestimate the likelihood that they’ll experience expensive, commonplace setbacks like injury, market downturns, or a leak in the roof.
Almost all entrepreneurs test high for optimism — and most of their businesses fail. And on a larger scale, optimism bias can cost billions: A Harvard study of 33 countries found that most government agencies were overly confident in their budget planning, particularly when times were flush, resulting in large deficits.
As an optimist myself, I can personally attest that my “it’ll work out” mentality has cost me more money than I care to think about. When you add up all cab fares from when I’m running later than expected or stuff I bought because I believed it was a “good investment,” it’s a lot. I consistently spend more money than I think I will, and it’s gotten me into some tight spots.
Which is why I was surprised to read that, in a survey of over 2,000 Americans who were evaluated with the Life Orientation Test, an optimism scale developed by the University of Miami’s psychology department, 90 percent of optimists had put aside money for a major purchase compared to just 70 percent of pessimists. What’s more, nearly two-thirds of optimists had started an emergency fund, compared to less than half of pessimists.
The key, says researcher Michelle Gielan, is finding the sweet spot of “rational optimism” — a balance of expecting good things, making a realistic assessment of the present, and perhaps most importantly, believing that our behavior can improve our circumstances.
She likens it to wearing a seat belt: Not doing so might be the more optimistic choice, technically, but it would also be stupid. “Irrational optimism” is about believing your situation will somehow get better, while rational optimism is about believing that you can make your situation better.
With saving money, Gielan explains, optimists gain the upper hand simply because they think they can do it. “When people believe that their behavior matters, especially in the face of challenges, then it predicts so many success measures — their performance at work, their energy levels, their productivity, and of course their finances,” she says.
“When optimists encounter a setback, they tend to see it as a temporary and local event, only one part of their reality, and they believe that if they take steps towards creating a solution they’ll be able to get through it.”
To continue reading, please go to the original article here:
https://www.thecut.com/2019/05/why-optimists-are-better-with-money.html
How To Teach Yourself to Succeed with Money
.Personal Finance 101: How To Teach Yourself to Succeed with Money
Invested Wallet
Personal Finance 101 is the beginning steps you can take to really become self-sufficient with your money. It will include various areas like understanding expenses, creating a budget, saving and investing basics, and more.
Many of these concepts may appear difficult to manage or that you must be highly educated to do so on your own. But you — and anyone — can teach themselves to succeed with money.
You don’t need to be an expert to manage your finances and you can have little to no previous background, but still gain control financially.
Below, I’ll share some of the steps I took to teach myself and hopefully you can apply this to your own personal finances. Will it be easy? No. But it’s certainly not extremely challenging either.
Personal Finance 101: How To Teach Yourself to Succeed with Money
Invested Wallet
Personal Finance 101 is the beginning steps you can take to really become self-sufficient with your money. It will include various areas like understanding expenses, creating a budget, saving and investing basics, and more.
Many of these concepts may appear difficult to manage or that you must be highly educated to do so on your own. But you — and anyone — can teach themselves to succeed with money.
You don’t need to be an expert to manage your finances and you can have little to no previous background, but still gain control financially.
Below, I’ll share some of the steps I took to teach myself and hopefully you can apply this to your own personal finances. Will it be easy? No. But it’s certainly not extremely challenging either.
Changing Your Money Mindset
Before we get into my Personal Finance 101 steps, I think a big gatekeeper to managing your money successfully is your mentality and mindset.
Firstly, many times the media or financial experts make this stuff seem like complicated rocket science. Surely some aspects to finance can be, but the majority is really not. This can mess with your mindset and feelings towards money from day one. I know it did for me.
Other times, it’s easier to be in-denial about our financial situations. If you don’t pay attention to the problem, it doesn’t exist, right?
But as you know, that temporary “solution” will inevitably snowball in the future where it becomes a much more challenging problem.
Another way your mindset might be hindered is maybe you are relatively on the younger side, say 20’s to early 30’s and finances is just not a priority to you. The “I’ll worry about it later” mentality creeps in because you have time on your side.
Whatever it is, your understanding of personal finances and dedication to get it under control has to start with the right mentality. Otherwise, it won’t be a priority to you nor will you dedicate time to learning.
I unfortunately can’t give you the magic “aha!” moment or steps to get on the right mental path. We are all unique in what works.
Teach yourself about money
Personal Finance 101: Teaching Yourself About Money
Hopefully, the section about mindset made sense and did not come off has some “self-help” preaching. My intent is really to ingrain that mindset is the first key ingredient to determine your success with teaching yourself about money.
We all know saving, investing, and budgeting is important, yet so many fail to take any action. This includes myself until 2014. Why?
Nothing will change if your mindset is stuck and you lack the willingness to erase the misconception that personal finances is “too hard.”
The cycle of change has to come from within.
Usually a moment in your financial life can be the motivation and drive you need, but even then there is no guarantee.
If you don’t think you are there mentally ready yet, the steps below won’t be impactful in the long-term. And that’s okay! Work on how you can motivate yourself and get in the right frame of mind to pursue teaching yourself about money.
I realized I needed to make changes in 2013, but it took me until 2014 to really do anything about it and felt ready.
But if you are stoked, truly motivated to make changes, and understand that it will take some dedication — then you are well on your way to successfully teaching yourself.
To continue reading, please go to the original article here:
Negotiating At Your Exchange by Mother Esq.
.From Recaps Archives
MotherEsq: Negotiating at your Exchange
Dear TNT family,
Taking another day off here and wanted to comment just a little bit about the “Exchange”. I am not an Intel provider but simply an “educator” on what I perceive to be tactics.
Again I admonish. You to be discerning in who you listen to among the Intel providers. As Rayren has stressed this week and last week, “there is some crazy stuff” out there. A lot of it starts out good and then as you get near the end “the yellow submarine” takes effect and and the lunacy comes out.
I received many positive comments on my last posting thank you. And only a few negative. I do not read everything – time constraints to be candid. However, I approach my analyzing like a lawyer approaches “evidence”.
When a lawyer looks at a document or listen to testimony we are looking at “context” – a document we apply the “4 corners” test which is often referred to as “Parole Evidence”.
From Recaps Archives
MotherEsq: Negotiating at your Exchange
Dear TNT family,
Taking another day off here and wanted to comment just a little bit about the “Exchange”. I am not an Intel provider but simply an “educator” on what I perceive to be tactics.
Again I admonish. You to be discerning in who you listen to among the Intel providers. As Rayren has stressed this week and last week, “there is some crazy stuff” out there.
A lot of it starts out good and then as you get near the end “the yellow submarine” takes effect and and the lunacy comes out.
I received many positive comments on my last posting thank you. And only a few negative. I do not read everything – time constraints to be candid. However, I approach my analyzing like a lawyer approaches “evidence”.
When a lawyer looks at a document or listen to testimony we are looking at “context” – a document we apply the “4 corners” test which is often referred to as “Parole Evidence”.
Not going to give you all a dissertation here but – when I read a posting or even listen to a call – in the back of my mind I am running through the tests for heresy statements, relevant facts, lineage etc.
Lastly I apply something that is applied in “criminal proceedings”. The doctrine of “Fruit from the “Poisoness Tree”. This doctrine says that if there is a violation in the collection of evidence in other words things like “chain of custody” or someone lied to obtain an affidavit or something was done wrong in the pursuit of evidence then anything obtained from this “Tree of evidence” is tainted and therefor thrown out.
This all applies to investigations done by the state in criminal investigations. You may be asking how does this apply to my thinking? Well when I look at a blog or posting and I see something crazy in it – then in my mind the whole thing is “tainted”.
Many of said take the good and discard the bad. That is like separating the “wheat from the chaff”. However if the source is bad how can you trust anything the person says? What is their motive? What is their agenda?
To my main purpose this morning. Negotiating. Please do not over complicate your first visit to the bank or exchange center by:
1.Taking an entourage of folks with you
2.Telling the banker you want to be a philanthropist and give away a lot of money
If you take someone with you to the bank you may block or prevent yourself from having a shot at “contract” rates. Because everyone knows a NDA will have to be signed. And that agreement is between you and the bank acting as agent for the government.
Do you really want to make the circle larger and create possible leaks that would jeopardize your future? If you take someone with you and they do not have a stake in this – it is easy for them to put you in jeopardy. Of course not willingly but why do you want o expose yourself? Remember, “Lose lips sink ships”.
I heard earlier this week from some outfit or notes from a call. Tell them the banker at the exchange you want to give to humanitarian causes and be this great philanthropist. Why in the world if I am a banker would I want to do business with someone who wants to give it all away?
I am representing the bank or financial institution. When you go into the bank – you need to tell the banker or exchanger, “Hey first of all thank you for working me into day. I know you are busy and have been dealing with a lot of folks.
Please I want and it is my hope we can establish a solid banking relationship and your institution can give me guidance for long term stability, planning. I want this to a mutually great profitable partnership, I would like to obtain the highest possible rate or contract rate available..”
Now your talking the banker’s language. They are there to make money for the bank and collect assets for management.
If right out of the gate you tell them how great you are and how much you want to give away – what is their incentive to help you?
Remember when negotiating, do not play all your cards, and the second rule upon making an opening statement, “first one who talks loses”. Just make a nice opening statement, then be quiet.
You have 1. Been gracious to the banker or showed empathy, 2. You have set the table – that you are sophisticated and want a solid relationship, 3. You have shared your expectations. Now be quiet.
Again you want to play to the vanity and greed of banks. If you go in saying you’re going to give money away – how does that benefit them? And remember “Planned Giving” is a part of “Planning” it is not about Exchanging. You are there to do an exchange not “plan”. So keep the two separate.
At your next appointment even then is not the time to “blab”. It is the time to meet the Planner and or Wealth manager and lay out goals and objectives to sustain your wealth into the future and grow it and put structures together that maximize “asset protection”, “provide for yourself and possible heirs” and to “minimize tax liabilities”. Planned giving fits into the last category because through planned giving you effect tax liabilities.
Anyway I hope in some way this helps a lot of folks.
Be courteous, kind and gracious upon your exchange. Keep it simple you are there to exchange and obtain the highest rate as possible if you chose that route. And you want to communicate stability, a level of sophistication and you want to get it over with so the banker can move on to the next person. Simple keep it that way. Be as “Wise as a Serpent and as Harmless as a Dove.
Kindest regards
Mother, Esq.
The Worst Things About Being a Millionaire
The Worst Things About Being a Millionaire
Kiplinger's Personal Finance | June 14, 2018 Updated for 2019
Who wants to be a millionaire? The more intriguing question would be, “Who doesn’t?” For most people, a million smackers conjures up images of vacations on the Riviera, Arabian racehorses and mattresses stuffed with freshly ironed $20 bills.
But being a millionaire today isn’t all it’s cracked up to be. Low interest rates and high living costs mean a million bucks in the bank doesn’t necessarily allow you to retire at 35, 45, 55 or even 65.
What’s worse, today’s million dollars comes with all the burdens of wealth: greedy relatives, rapacious lawyers and grasping investment advisers.
The Worst Things About Being a Millionaire
Kiplinger's Personal Finance | June 14, 2018 Updated for 2019
Who wants to be a millionaire? The more intriguing question would be, “Who doesn’t?” For most people, a million smackers conjures up images of vacations on the Riviera, Arabian racehorses and mattresses stuffed with freshly ironed $20 bills.
But being a millionaire today isn’t all it’s cracked up to be. Low interest rates and high living costs mean a million bucks in the bank doesn’t necessarily allow you to retire at 35, 45, 55 or even 65.
What’s worse, today’s million dollars comes with all the burdens of wealth: greedy relatives, rapacious lawyers and grasping investment advisers.
A Million Isn’t What It Used to Be
Financial advisers say a sustainable annual withdrawal from retirement savings is 4%. With a million-dollar nest egg, a 4% draw-down means annual income of $40,000. And that’s before taxes. If you stick with the 4% withdrawal rate and earn an average 8% on your money annually, you’ll be in good shape for the long run.
But can you really live on $40,000 a year? Most millionaires don’t want to. “If you are 45, 50, 55 years old and spend like a millionaire, then you are doing two things with your money that may well not work for you long term,” says Tom Davison, a financial planner in Columbus, Ohio.
“The first is not saving extra dollars now, and the second is establishing a lifestyle cost that, for most people, will be hard to cut back on later.”
That being the case, let’s say you pull $100,000 a year from your savings, you earn 8% a year, and you don’t adjust upward for inflation. Here’s how your account would fare: at the end of Year 1, you'd have $972,000 left; Year 5, $835,735; Year 10, $594,376; Year 15, $239,741; and Year 18, $0. Yup — broke in retirement.
To continue reading, please go to the original article here:
How Low? Too Low
How Low? Too Low
John Lim | September 27, 2019
IT’S WIDELY assumed that the Federal Reserve, our nation’s central bank, has two mandates: maximum employment and stable prices. But a closer look at the Federal Reserve Act of 1977 on the Federal Reserve’s very own website reveals a third mandate, namely “moderate long-term interest rates.”
Does a 1.7% yield on 10-year Treasurys and 2.15% on 30-year Treasurys count as “moderate long-term interest rates”? Since I have nothing better to do on the weekend, I headed to the Federal Reserve Bank of St. Louis’s website to see what the average long-term yields have been since the Federal Reserve Act of 1977 passed. The answer: 6.2% for the 10-year Treasury and 6.75% for the 30-year Treasury.
The Federal Reserve is doing much better on the employment front, with the unemployment rate hovering around 3.7% lately. And it certainly seems like prices are stable, with both the Fed’s favorite inflation metric and inflation expectations hovering around 1.6%. I guess two out of three isn’t bad.
How Low? Too Low
John Lim | September 27, 2019
IT’S WIDELY assumed that the Federal Reserve, our nation’s central bank, has two mandates: maximum employment and stable prices. But a closer look at the Federal Reserve Act of 1977 on the Federal Reserve’s very own website reveals a third mandate, namely “moderate long-term interest rates.”
Does a 1.7% yield on 10-year Treasurys and 2.15% on 30-year Treasurys count as “moderate long-term interest rates”? Since I have nothing better to do on the weekend, I headed to the Federal Reserve Bank of St. Louis’s website to see what the average long-term yields have been since the Federal Reserve Act of 1977 passed. The answer: 6.2% for the 10-year Treasury and 6.75% for the 30-year Treasury.
The Federal Reserve is doing much better on the employment front, with the unemployment rate hovering around 3.7% lately. And it certainly seems like prices are stable, with both the Fed’s favorite inflation metric and inflation expectations hovering around 1.6%. I guess two out of three isn’t bad.
But getting back to the Fed’s third mandate: Is it really a mandate and, if so, does it really matter? To answer the first question, I consulted Prof. Google. I typed “Federal Reserve and moderate long-term interest rates“ into the search box. The top five search results linked to official Federal Reserve websites.
A site run by the Federal Reserve Bank of Richmond tersely states: “The third goal—’moderate long-term interest rates’—is often not explicitly discussed.”
According to the Federal Reserve Bank of San Francisco, “These dual policy goals [maximum employment and low stable inflation] imply moderate long-term interest rates.” Talk about a non-mandate mandate.
It’s worth noting that the Fed has much less control over long-term interest rates than short-term rates, hence the predictive power of the yield curve.
If so, why include the third mandate in the 1977 Federal Reserve Act? I suspect it was included because the 1970s were a period when inflation began to spiral out of control. This led to very high interest rates, with the 30-year Treasury eventually peaking at 15% in 1981.
If inflation and inflation expectations are under control, as they have been for decades, long-term interest rates will likely be contained. But what about excessively low long-term rates? Does the Fed have a duty to prevent long-term interest rates from getting too low?
Based on the actions of the Federal Reserve in recent years, the answer is an unequivocal “no.” The post-Great Recession quantitative easing and zero interest rate policy took aim not just at short-term rates, but also at long-term rates, dragging both lower.
As recently as 2016, Ben Bernanke discussed the explicit targeting of long-term rates as a viable tool for the Fed. With a recession on the horizon and interest rates already so low, it’s certainly possible—and maybe even probable—that long-term interest rates will soon be targeted again and pushed even lower, perhaps to zero or below, with the goal of spurring economic growth.
To continue reading, please go to the original article here:
What Are the Best States to Retire for Taxes?
..What Are the Best States to Retire for Taxes?
Overview of Retirement Tax Friendliness
Retirees have specific financial concerns and some states have taxes that are friendlier to those needs. Of special interest to retirees are generally issues such as whether Social Security benefits are taxable at the state level, what property taxes will be levied and how retirement account and pension withdrawals are taxed.
Click on a state to see a full overview and calculate your taxes
Very Tax Friendly
States that either have no state income tax, no tax on retirement income, or a significant tax deduction on retirement income. In addition, states in this category have friendly sales, property, estate and inheritance tax rates. Alaska Florida Georgia Mississippi Nevada South Dakota Wyoming
Tax Friendly
States that do not tax Social Security income and offer an additional deduction on some or all other forms of retirement income. Generally, states in this category also have relatively friendly sales, property, estate, inheritance and income tax rates.
What Are the Best States to Retire for Taxes?
Overview of Retirement Tax Friendliness
Retirees have specific financial concerns and some states have taxes that are friendlier to those needs. Of special interest to retirees are generally issues such as whether Social Security benefits are taxable at the state level, what property taxes will be levied and how retirement account and pension withdrawals are taxed.
Click on a state to see a full overview and calculate your taxes LINK
Very Tax Friendly
States that either have no state income tax, no tax on retirement income, or a significant tax deduction on retirement income. In addition, states in this category have friendly sales, property, estate and inheritance tax rates. Alaska Florida Georgia Mississippi Nevada South Dakota Wyoming
Tax Friendly
States that do not tax Social Security income and offer an additional deduction on some or all other forms of retirement income. Generally, states in this category also have relatively friendly sales, property, estate, inheritance and income tax rates.
Alabama Arkansas Colorado Delaware Idaho Illinois Kentucky Louisiana Michigan New Hampshire Oklahoma Pennsylvania South Carolina Tennessee Texas Virginia Washington West Virginia
Moderately Tax Friendly
States that offer smaller deductions on some or all forms of retirement income. The sales, property, estate, inheritance and income tax rates in this category range in friendliness based on the degree of retirement deductions available.
Arizona District of Columbia Hawaii Indiana Iowa Kansas Maryland Massachusetts Missouri Montana New Jersey New Mexico New York North Carolina North Dakota Ohio Oregon Utah Wisconsin
Not Tax Friendly
States that offer minimal to no retirement income tax benefits. These states also do not have particularly friendly sales, property, estate and inheritance tax rates.
California Connecticut Maine Minnesota Nebraska Rhode Island Vermont
Retirement Tax Friendliness
For seniors who plan to move to a new city or state for their retirement, there are a number of factors to consider. Weather is important to many retirees, as are amenities and attractions such as golf courses, beaches, parks and senior centers. Another major consideration is the cost of living in a certain area. Taxes are a big part of that.
To continue reading, please go to the original article at
.11 Steps to Make $1 Million Last 30 Years in Retirement
.11 Steps to Make $1 Million Last 30 Years in Retirement
Derek Silva, CEPF® | OCT 02, 2018
The average life expectancy in the U.S. has increased dramatically from about 70 in 1967 to about 80 in 2017. Those who reach age 65 also have a one in five chance of living into their 90s. A longer life is great news. It means you have time to check more off your bucket list.
At the same time, it means you need to plan for a longer retirement. If you retire at 65, a 30-year retirement is quite possible. Even if you save $1 million for your retirement, you have to make sure to budget it out so it lasts.
Here are 11 steps to set yourself up for a happy retirement without draining your savings too soon.
11 Steps to Make $1 Million Last 30 Years in Retirement
Derek Silva, CEPF® | OCT 02, 2018
The average life expectancy in the U.S. has increased dramatically from about 70 in 1967 to about 80 in 2017. Those who reach age 65 also have a one in five chance of living into their 90s. A longer life is great news. It means you have time to check more off your bucket list.
At the same time, it means you need to plan for a longer retirement. If you retire at 65, a 30-year retirement is quite possible. Even if you save $1 million for your retirement, you have to make sure to budget it out so it lasts.
Here are 11 steps to set yourself up for a happy retirement without draining your savings too soon.
1. Maximize the Return on Your Savings
Imagine $28,243 more dollars in your bank account. It is doable. That is the interest income you would earn from generating an additional 1.0% in interest on on a $100,000 deposit over 25 years.
A very common mistake is to leave money in a checking account accruing no interest. People either think that interest rates are too low and it will not make a difference or the money will not be in your bank account so it will not make a difference. Fortunately that is just not true.
If you use a high-interest savings account you can earn up to 1.85% and still have unrestricted access to your savings. To put that into perspective the national average savings account rate is 0.23%.
By choosing an account that offers the highest rate of 1.85% you can earn a lot more. Here’s an example: If you have $250,000 in a savings account and save over 20 years in retirement, you would generate extra interest income of $110,712.
Recommended Action: Open a high-yield savings account. This CIT Savings Builder Account offers 2.45% interest as long as you deposit at least $100/month or maintain a $25,000 balance.
2. Keep Investing Intelligently
To get an accurate picture of your expenses and retirement needs, we recommend speaking with a financial advisor that specializes in retirement planning.
Studies show consulting a financial advisor can help you earn up to an extra 4% return on your investments. Advisors are also skilled in identifying areas where you could be overpaying in taxes and fees, as well as how to best allocate your savings among your retirement accounts and investments.
A Voya Financial report found that 79% of people who use a financial advisor “know how to pursue achieving their retirement goals.” The study also found that 59% of those who use an advisor have calculated how much they need to retire, while 52% have a formal retirement investment plan in place.
Recommended Action: Find a financial advisor. We've simplified the process to get in touch with one by designing a tool to match you with the top financial advisors in your area.
Here's how it works:
Answer these few questions about your current financial situation.
To continue reading, please go to the original article at