7 Common Money Arguments in Marriage

7 Common Money Arguments in Marriage — And How to Tackle Them Together

By Jeremy Brown Apr 20 2021, 5:31 PM

From misaligned financial visions to lack of follow through on previously set financial goals, these money arguments are very common.

Arguments about money are about more than money. In every heated discussion about overspending, mismanagement, bills being ignored, issues of envy, guilt, shame, fear loom large. Financial therapists and counsellors understand this, which is why, in addition to helping with brass taxes financial decisions, they also look at the emotions behind money arguments. This better helps individuals and couples gain a better sense of the complex mechanisms at work so they can make better decisions and have fewer arguments.

“For many people, the thought of entering financial coaching or money counseling means something is or has gone wrong,” says AJ Bishop, Chief Executive Officer and the Founder of My Wealth Conscious Coach. “Sure, they understand and know they have a disconnect around money, but it’s not an unworkable topic.

Hello, World!

Therefore, good, hardworking, reasonable people attempt to resolve the “I-can-do-it-all-by-myself” items and avoid the major topics and financial issues that do create conflict, tension, and sometimes fights about money.’

Financial counsellors and therapists see a lot of the same arguments over and over again. They’re also keenly able to help couples identify the various larger issues at play and help them end the arguments once and for all. Here, then, are a few of the more common money arguments in marriage they see — and some ways to prevent them from cropping up again and again.

The Money Argument: Your Financial Visions are Misaligned

Very often couples who struggle financially are not on the same page when it comes to their overall vision. They have different priorities on what is important, spending-wise, or different ideas on how to spend money.

This can create problems right from the start that can only grow worse over time. One person wants to go on a lavish vacation, while the other wants to save to buy a house. Over time, each person comes to resent the other, thinking that they’re either cheap or that they spend too much.

The Solution: Couples need to sit down separately and map out their own financial visions and then do the same thing together. And, if you’ve done that already, do it again and often. “Priorities, goals and objectives change regularly,” Bishop says. “Don’t make assumptions that you’re heading in the same direction because you had the conversation that one time.”

The Money Argument: There’s no follow-through on financial goals

To continue reading, please go to the original article here:

https://www.fatherly.com/love-money/money-arguments-in-marriage/

<

p>Hello, World!

3 Important Lessons I Learned from Collecting Baseball Cards

3 Important Lessons I Learned from Collecting Baseball Cards

MAY 10, 2021

A few weeks ago my dad asked me to list a few baseball cards on eBay. The cards were 2001 rookie cards of Ichiro Suzuki and Albert Pujols. To my surprise, each card sold for several hundred dollars really fast. Listing those cards brought back old memories of collecting baseball cards as a kid. This post goes over three important life lessons I’ve taken into adulthood from my time collecting baseball cards.

My Saturday nights as a pre-teen were often spent swapping baseball cards with friends. My best friend lived three houses up the street and was my main trading partner. We’d often have sleep-overs filled with wrestling videos, video games, and an all-out baseball card exchange.

Yes, I was (and still am) a huge nerd.

Professional Skills Learned from Collecting Baseball Cards

While going through my old collection, I came across the crown jewel of most baseball card collections from the early 90s. A Ken Griffey Jr. 1989 Upper Deck rookie card. First of all, it makes me feel super old that Ken Griffey Jr. has been retired for more than 10 years (and let’s be honest, he’s pretty much been retired since 2000 when he left Seattle).

Even though most of the cards in what’s left of my collection are worthless, it got me thinking about all of the lessons I learned from collecting baseball cards as a youngster.

Collecting cards taught me how to negotiate with friends and vendors at a young age. It also taught me how to make what seemed at the time like tough and sometimes emotional decisions. As silly as it sounds, I used to get very attached to cards in my collection. Last but not least, it helped to estimate the future value of an asset.

Even my decision to major in finance was in some ways driven by collecting baseball cards. My mom used to say, “You should be a stock broker, it’s like trading baseball cards only with stocks!” While this didn’t make much sense at the time, I can see the connection now. Baseball cards are an asset with a present value based on a variety of different factors. The goal is to predict the future value of the asset to maximize return.

Below are a few of the lessons I learned from collecting baseball cards as a kid.

Negotiation Skills

To continue reading, please go to the original article here:

https://www.financialpilgrimage.com/heres-what-i-learned-from-collecting-baseball-cards/?utm_source=rss&utm_medium=rss&utm_campaign=heres-what-i-learned-from-collecting-baseball-cards

Sleeping with Cash

Sleeping with Cash

Andrew Forsythe    May 6, 2021

HERE AT HUMBLEDOLLAR and in many other places, this point has been made: The best investment portfolio isn’t the one that’s theoretically or empirically superior. Rather, it’s the one that lets you sleep at night.  What I’ve found, as far as my portfolio goes, is that the necessary prerequisite for a good night’s sleep is one thing above all else: an oversized cash reserve. By that, I mean a cash hoard that can handle not only the most likely contingencies, but also unexpected ones—and then some.

I typically keep enough cash to finance our normal expenditures for at least six years. In fact, with the current bubbly stock market, I’m above that level. To back that up, I also have a decent allocation to bond funds, consisting mostly of an intermediate-term municipal fund in a taxable account and total bond market index funds in retirement accounts.

Back in 2017, author William Bernstein was quoted in HumbleDollar saying, “When you’ve won the game, stop playing with money you really need.” That insight struck a chord with me, and it’s one of the reasons I’ve come to value cash.

I’m less interested in getting richer and more interested in guaranteeing that the modest lifestyle that has served my wife and me so well can be maintained for as long as we remain on this planet, regardless of any curveballs thrown our way.

The importance of a good-sized cash reserve was brought home to me over my many years as a criminal defense lawyer. While my early days often involved more dramatic and serious cases, later on my bread-and-butter business was representing basically good, decent people who (or whose kids) made a mistake or two: driving while intoxicated, drug possession and various other weaknesses of the “there but for the grace of God go I” type.

What constantly amazed me was how many of these seemingly middle-class folks, at a time of real urgency, struggled to come up with even a modest down payment for my services. For most garden variety misdemeanors, I had long believed it was reasonable to ask for a $1,000 retainer, with a payment plan for any remaining balance that stretched over several months.

To continue reading, please go to the original article here:

https://humbledollar.com/2021/05/sleeping-with-cash/

Three Reasons Why Inflation Is Rising. Two Of Them Aren’t Going Away

 Three Reasons Why Inflation Is Rising. Two Of Them Aren’t Going Away

Notes From the Field By Simon Black  May 5, 2021  Cancun, Mexico

A remarkable thing happened yesterday that tells you everything you need to know about inflation. In the morning, US Treasury Secretary Janet Yellen stated bluntly that “interest rates will have to rise somewhat to make sure that our economy doesn’t overheat. . .”

For economists, an ‘overheating economy’ means inflation. So she was essentially saying that rates would have to rise to prevent inflation. Yet hours later, she completely reversed herself, saying that interest rates would NOT have to rise because “I don’t think there’s going to be an inflationary problem.”

You don’t need a PhD in economics to smell the BS.

Inflation is not some potential issue down the road. Inflation is already here.

As Warren Buffett told investors only days ago, “We’re seeing very substantial inflation.”

Plenty of companies have already announced price increases to their consumers--

Proctor & Gamble, for instance, announced price hikes across the board on just about everything from diapers to beauty creams.

Hershey’s announced in February that it would be raising prices.

Food giant General Mills complained in February about a “higher inflationary environment” and “input cost pressures” due to rising commodity prices.

Clorox, Shake Shack, Kimberly-Clark, Whirlpool, Hormel, and Woka Kola Coca Cola are among the many companies that have also announced price increases.

And according to Bank of America Global Research, the number of mentions of “inflation” on corporate earnings calls has increased 800% compared to last year.

Inflation is clearly a concern of the largest companies in the world. Investors are worried. Consumers can see it.

And in a rare moment of truth yesterday morning, a politician almost admitted that she was concerned about inflation too.

This is not some wild conspiracy. Inflation is real. It’s happening. Let’s look at three key drivers:

1) Capacity Constraints

Last year the entire world shut down. Businesses and factories everywhere closed, and plenty of companies went out of business.

Many companies who survived took radical steps to conserve cash-- laying off workers, liquidating inventory, and selling equipment.

One critical consequence was that the amount of capacity in the system was greatly reduced.

Here’s an example: I’ve been in Cancun for several weeks, and as you know, this place is a major tourist destination.

Last year when tourism dried up, plenty of companies went out of business. Rental car companies, for example, had practically zero customers. Many went bankrupt. Others survived by selling off most of their vehicles, believing that it would be years before the tourists returned.

But a year later, the tourists are back.

Problem is, there are now very few cars to rent in Cancun, because rental agencies either went bankrupt or liquidated their inventories.

As a result, car rental prices in Cancun have surged; supply is scarce, yet demand is back to normal.

We’re seeing similar effects across the economy. Capacity is limited because of the extreme measures that businesses took last year. And they can’t simply flip a switch and bring capacity back to normal. It takes time.

They’ll have to invest in inventory, hire more staff, etc. Eventually, these supply/demand imbalances will stabilize. But for the foreseeable future, it’s driving prices higher.

This is the type of inflation that politicians and central bankers have been calling “transitory”. In other words, it’s temporary pressure that should subside in the future.

2) COVID lunacy

Hardly anyone talks about this... but just think about all the idiotic rules that people have to follow now.

If you own a retail store in a shopping mall, for example, you have to pay employees to stand at the door ready to hose down every customer who walks inside with hand sanitizer.

And imagine how much money businesses are spending now on PPE… masks, gloves, hand sanitizer, etc. Or companies (airlines, hotels, etc) that now employ legions of workers to chemically scrub every nook and cranny of the premises.

All of this costs money, and the extra costs eventually get passed on to consumers. Most likely, these measures are not going away… which means that COVID is extremely inflationary.

3) Trillions in money printing

This is the big one. The US federal government is hoping to spend a whopping $11 TRILLION this year, between the regular budget, COVID stimulus already passed, and all the new legislation they’re proposing.

And it’s only May.

Obviously Uncle Sam doesn’t have the money. So they have to borrow it.

Their chief remaining lender these days is the Federal Reserve, which first has to ‘print’ money before loaning it to the government.

(The actual process is more modern and complex, but that’s basically what happens in a nutshell.)

The more money the government spends, the more the Fed prints (roughly $4 trillion last year). And as this freshly created money makes its way through the economy, it typically ends up in financial markets, driving asset prices higher.

It’s not a coincidence that the Fed has created record sums of money, and the stock market is simultaneously at a record high. Ditto for real estate, cryptocurrencies, collectibles, etc.

Many commodities are also at record highs. Lumber prices have never been higher. Corn is near its all-time high. Oil prices surged from MINUS $40/barrel last year to $70 today-- a difference of $110.

Higher commodity prices eventually lead to higher consumer prices.

High lumber prices, for example, mean that housing costs increase. Higher corn prices mean higher food prices. Higher fuel prices mean higher transport costs, which increases the price of almost everything.

So as long as the Federal Reserve is printing money and holding rates down to historic lows, these prices will likely keep rising.

Given the US government’s insatiable appetite to borrow money from the Fed, this inflation pressure is NOT going away.

And after what we saw yesterday, it’s clear that the government’s approach will be to ignore or dismiss inflation risks.

To your freedom and prosperity, Simon Black, Founder, SovereignMan.com

https://www.sovereignman.com/trends/three-reasons-why-inflation-is-rising-two-of-them-arent-going-away-32121/

Why Financial Strain Is So Harmful to Your Health

Why Financial Strain Is So Harmful to Your Health

A conversation with Dr. Michael Stein on the toll simply not having enough money takes on your body.

BY DREW MILLARD   March 29, 2021

A 100 bill's face is covered with a mask as a doctor would wear.  Anton Petrus

In an address to the nation earlier this month, President Joe Biden marked the one-year anniversary of the coronavirus pandemic by announcing that all American adults would be eligible for the COVID vaccine by May 1. If we all get vaccinated, he said, “there’s a good chance you, your families, and friends will be able to get together” on the Fourth of July “and have a cookout.” The implication was that we will finally have passed the apex of the virus, and that, slowly but surely, things will once again begin to feel normal again.

Except that’s not how things work, really. We have spent the past year in the throes of a public health crisis which quickly brought with it an economic one to match. Nearly a year after the initial shock of 22 million Americans losing their jobs at the onset of the pandemic, 18.7 million people are still filing for unemployment. This is to say nothing of those who have been without a job for so long that they are no longer technically counted as members of the workforce. While plenty of people are going to emerge from the pandemic in better financial shape than ever, many others have felt the sting of financial precarity in ways that affect their ability to pay for their housing or food. We will be dealing with the economic consequences of the pandemic for years.

To Dr. Michael Stein, a Boston University professor and chair of the school’s Health Law, Policy, and Management department—and who also works as a primary care doctor to low-income patients—America’s issues with physical and financial health are inextricable. “Perhaps poverty should be approached from a public health perspective, as the moral perspective alone has failed us,” he writes in the introduction of his recent book Broke:

Patients Talk about Money with Their Doctor. On the surface, Broke is exactly what it sounds like it would be—a book full of anecdotes, narrated by Stein but told mostly without commentary, about how his patients deal with money. But the format is just a narrative device, really, meant to illustrate Stein’s larger point, which is that when people are poor, their lives are hard in ways that are always unique and frequently unmanageable—to the point where day-to-day survival must take precedent over their long-term goals. It’s his professional obligation, he believes, to talk to his patients about money, help them deal with their financial problems as best he can. “Feeling a bit more in control of their finances, or less out of control," he writes, "allows patients the mental space to make clearer decisions, health decisions included."

Stein says he decided to start the book when a patient told him, “I’m so broke I have to rinse off paper plates.” The image is indelible, and in Broke it is the first thing we hear from his patients, who throughout the pages tell stories of hustling black-market watches to make ends meet, altercations with rapacious landlords, being swindled out of money by their loved ones, and falling through bureaucratic holes in America’s ragged, underfunded, and uncaring social safety net. Together, the vignettes of Broke describe a dizzying array of symptoms to the same sickness whose cure, however simple, is nevertheless out of reach. With more Americans hanging on by a thread than ever before, this is a book worth reading.

To continue reading, please go to the original article here:

https://www.gq.com/story/financial-strain-is-so-harmful-to-your-health-michael-stein

The 7 Money Personality Types

The 7 Money Personality Types, says psychology expert—how to tell which one you are (and the pitfalls of each)

Published Wed, Apr 28 2021 12:51 PM EDT  Ken Honda, Contributor

We often stress about the importance of financial literacy, such as gaining a strong understanding of how money works and having the resources to make informed decisions.  But when it comes to establishing financial health, one thing most people fail to consider is their money personality type — or their approach and emotional responses to money.

We each have our own beliefs and emotions about money, and they are mostly shaped by our individual life experiences (e.g., passed down from our parents or influenced by our current situations).

In my 10-plus years of researching the psychology of money and happiness, I’ve found that there are seven distinct money personality types. Typically, we fall into a combination of many types, and not just one.

7 Money Personality Types

Ken Honda, author of “Happy Money”

Identifying which types you fall under, and understanding the pitfalls of each, can significantly improve your relationship with money. It can help you do things like spend less on impulse purchases, be better about budgeting, invest wisely and ensure a nice nest egg for retirement.

1. The Compulsive Saver

Signs you might be a Compulsive Saver:

You put away money endlessly, sometimes with no actual end goal in mind.

You believe saving money is the only way to feel more secure in life.

You’re very frugal. (Friends will often come to you for advice on which phone company is the cheapest, which point cards are worth it, or when to buy plane tickets at the lowest price.)

Pitfalls: Some Compulsive Savers are so afraid of losing money that they go their entire lives without spending any of what they worked so hard to save. For example, they might choose to skip out on hobbies or activities that could bring them happiness and purpose.

Money advice: It’s all about moderation; learn to find a balance between saving money and enjoying life. Think about where you see yourself in the future and how you can use your savings to get there.

2. The Compulsive Spender

To continue reading, please go to the original article here:

https://www.cnbc.com/2021/04/28/7-money-personality-types-and-the-pitfalls-of-each.html

Don’t Ever Give Up: Surviving 10 Years Of Prison

Don’t Ever Give Up: Surviving 10 Years Of Prison

Updated: 12/04/2019 by Financial Samurai

When I was in high school, I got in a lot of trouble. As a result, I often wondered if anybody would ever give me a chance at life. Because I ended up receiving multiple chances despite my screw ups, I’ve learned to be more thankful and not take things for granted. I also developed an affinity for people who also had a rough time growing up, but found a way to make things work.

The following is a guest post from Bill, a man who spent 10 years in prison before getting on the path to financial freedom. Hopefully his post will give you the motivation to stick with things when times are tough and not lose faith that everything will turn out OK in the end.

I walked into my jail cell. I heard the door close behind me. I had just been sentenced to ten years in prison. It was my first time ever in trouble and I was in shock. I didn’t know what to think. The emotions came in horrible waves. I felt an overwhelming sense of relief at first. The night before, my attorney had braced me with the reality that the negotiations with the district attorney had not gone well, and that the state was going to be recommending 20 years of incarceration.

In court that day, the judged looked down at me in handcuffs and I heard him read his sentence in shock: “The state sentences you to ten years in prison. Due to sentencing guidelines, you will have no chance at early release or parole. Good luck to you.”

That night the harsh reality of being sentenced to 10 years in prison settled in my mind like slow mental torture. How was I going to survive it? How could I hold onto my sanity with such a horrible future ahead of me? I reflected how I found myself in this position. I had first used drugs when I was 14, smoked a joint, and liked it. For years, drugs and parties provided an escape from my otherwise normal life, and drugs provided me a fantasy of happiness I thought was real. But that illusion was shattered after a friend left my college apartment one night after partying, overdosed, and died in his sleep.

The next morning, I was arrested and charged with “reckless homicide by delivery of a controlled substance.” I had provided some of the drugs that contributed to his death that night, and that’s all the state had to prove to convict me of the charge.

I had gotten high hundreds, or thousands of times, but I never meant to harm anyone. It was a terrible accident. Everyone involved in the tragedy lost. I learned that when you play with fire, you don’t get to decide how badly you get burned.

Life as I knew it was over. No one was going to fight for a comeback for me.  My life was now a mission to prove that I was a better human being than the one they threw away for a decade.

The Awakening: Step 1

The morning following my sentencing hearing, I was driven to prison in a van filled with 5-10 other inmates I’d never seen or met.  We rolled across the highway in blaze orange jumpsuits, and chains wrapped around our wrists, ankles, and waists. When we arrived at the prison intake dock, we were given a badge displaying our prison inmate number. 

To continue reading, please go to the original article here:

https://www.financialsamurai.com/dont-ever-give-up-surviving-10-years-of-prison/

Be Prepared For The Next Black Swan

Be Prepared For The Next Black Swan

By Larry Swedroe

 “Measures of uncertainty that are based on the bell curve simply disregard the possibility, and the impact, of sharp jumps… Using them is like focusing on the grass and missing out on the (gigantic) trees. Although unpredictable large deviations are rare, they cannot be dismissed as outliers because, cumulatively, their impact is so dramatic.”

— Nassim Taleb, The Black Swan: The Impact of the Highly Improbable

Over the course of the first two decades of the 21st century, equity markets faced three “black swan” events: the attacks of September 11, 2001, the Global Financial Crisis that began in late 2007 and the COVID-19 pandemic. Each resulted in steep falls in equity prices. The term “black swan” was a common expression in 16th-century London that described impossibility. It derived from the old-world presumption that all swans must be white—because all historical records of swans reported that they had white feathers.

Thus, a black swan was something that was impossible, or nearly impossible, and could not exist. After the discovery of black swans in Western Australia in 1697 by a Dutch expedition led by explorer Willem de Vlamingh on the Swan River, the term metamorphosed to connote that a perceived impossibility may later be found to exist.

With the publication of Nassim Nicholas Taleb’s 2001 book, Fooled by Randomness, “black swan” became part of the investment vernacular — virtually synonymous with the term “fat tail”. In terms of investing, fat tails are distributions in which very low and high values are more frequent than a normal distribution predicts.

In a normal distribution, the tails to the extreme left and extreme right of the mean become smaller, ultimately reaching zero occurrences. However, the historical evidence on stock returns is that they demonstrate occurrences of low and high values that are far greater than theoretically expected by a normal distribution.

Thus, an understanding of the risk of fat tails is an important part of developing an appropriate asset allocation and investment plan. Unfortunately, many investors fail to account for the risk of fat tails. Let’s look at some evidence on their existence.

Javier Estrada, author of the 2007 study Black Swans and Market Timing: How Not To Generate Alpha, examined the returns of 15 stock markets and more than 160,000 daily returns. He sought to determine the likelihood that investors can successfully predict the best days to be in and out of the market. Following is a summary of its findings:

1. Stock Returns Are Not Normally Distributed

Black swans appear with far greater frequency than predicted by normal distributions. For example, for the Dow Jones Industrial Average, 29,190 trading days (107 years) produced a daily mean return of 0.02 percent and a standard deviation of 1.07 percent. Under the assumption of normality, 39 days would produce returns above 3.22 percent, and 39 would produce returns below -3.17 percent.

However, there were six times the number of returns outside that range—253 daily returns below -3.17 percent and 208 above 3.22 percent. Note that the maximum and minimum daily returns were 15.34 percent and -22.61 percent. The returns exhibited a high degree of negative skewness (the left tail of the distribution curve is larger) and excess kurtosis (fat tails)—clear departures from normality.

To continue reading, please go to the original article here:

https://www.evidenceinvestor.com/be-prepared-for-the-next-black-swan/

Feel Better

Feel Better

Jonathan Clements  Humble Dollar|  April 10, 2021

WARREN BUFFETT doesn’t have the best investment record over the past three decades. That accolade apparently belongs to Jim Simons. Buffett also isn’t the world’s richest person. In fact, he hasn’t held that title for the past dozen years and currently ranks No. 6, with barely half the wealth of today’s richest person, Jeff Bezos.  I doubt Buffett feels bad about this. Is your surname neither Simons nor Bezos? I don’t think you should feel bad, either.

Money can be maddening—if we let it. There will almost always be some parts of our portfolio whose performance disappoints. There will always be some folks who are wealthier. But whether it’s our investment performance or our overall net worth, we shouldn’t let ourselves be bothered by our relative standing. Why not? Here are five reasons.

1. We likely made more good decisions than bad. Just 52.6% of American households own stocks, according to the Federal Reserve. If you count yourself among that group, your investment performance has almost certainly been better than that of the stock-less 47.4%.

What’s your net worth—the value of your assets, including your home, minus all debt? If it’s greater than $122,000, you’re wealthier than half of all U.S. households. Yes, all of us throw the occasional pity-party for ourselves. But the fact is, if you’re reading this article, you are likely in far better financial shape than most of your fellow citizens.

2. What’s valued economically changes. Those who have been paying attention will remember me telling this story before: When my father graduated from Cambridge University in 1956, he took the highest-paying job on offer, which was £800 a year working as a reporter for the Financial Times. That was £100 more than he could have made as a management trainee for Royal Dutch Shell, which was the next highest-paying job he was offered.

By contrast, when I graduated Cambridge in 1985, my starting salary as a junior reporter was £6,500, less than half what my university friends earned by joining financial firms in the City of London. For today’s would-be journalists, the wage disparity is likely to be even greater. My point: The price that the economy puts on particular skills changes over time.

If we have a set of talents that aren’t particularly well-rewarded by today’s economy, we could try a different career and perhaps that’ll prove necessary. Still, pursuing a high-paying career for which we’re ill-suited is likely to be a miserable endeavor—and probably an unsuccessful one.

3. Don’t overlook the role of luck. With good savings habits and a little financial savvy, I think almost anybody can amass at least a modest nest egg. But we all know people who have done far better. Oftentimes, they appear to have lucked out, whether it’s because they have wealthy parents, a high-earning spouse, a single lucky stock pick, or a boss who takes a shine to them and pulls them up the corporate ladder.

To continue reading, please go to the original article here:

https://humbledollar.com/2021/04/feel-better/

10 Bad Money Habits You Learned From Your Parents and Need To Break Now

10 Bad Money Habits You Learned From Your Parents and Need To Break Now

Cynthia Measom   Tue, April 27, 2021,

An “Invest in You” savings survey by CNBC and Acorns found that some Americans are harboring what could be viewed as bad money habits. For example, 27% of Americans rarely discuss their personal finances with family. And 75% of Americans manage their own money, whereas only 17% hire a financial advisor.  So if these Americans aren’t forming their money habits based on help from a financial advisor, who is their financial role model? According to the survey, 37% of respondents said it was their parent.

Does that mean that the financial habits your parents have are bad? Maybe so and maybe no. It depends on what those financial habits are.  Some bad money habits are glaringly obvious. You know, like paying only the minimum on a maxed-out credit card each month or always spending extra money on wasteful items. But some aren’t so obvious — especially if you’re following the example set by a parent who serves as your financial role model.

To find out where you stand, check out these 10 bad money habits people learn from their parents, and see if any of them ring true for you.

Focus On Saving Your Money

Kristin Burton, founder of Strive Coaching, believes that one bad money habit learned from parents is to save your money.

“At first glance, this looks like great advice, but if you dig deeper it is missing a fundamental piece of wealth building,” Burton said. “Saving money should be reserved for an emergency fund (three to six months of monthly expenses set aside for unforeseen events) and “sinking funds” (money set aside for large, planned purchases). Aside from that, you can never save your way to wealth! You have to be investing. All money that is not specifically for an emergency fund or sinking fund should be invested, not saved.”

Max Fund Your 401(k) Instead of Paying Off Debt

Chuck Czajka, founder of Macro Money Concepts, said that max funding your 401(k) when you have credit card debt or student loans is one on a long list of bad money habits taught by parents.

“The 401(k) earns interest, but the whole account is taxable when you take the money out,” said Czajka. “So, you’re losing interest to credit card debt and student loans, and going to continue losing in the future to taxation on your 401(k) or IRA. It’s better to pay off that debt first, then save for retirement.”

Be Ashamed of Money Mistakes

Gretchen Caldwell, CFP and president of Pure Planning, believes that one bad money habit parents teach is to be ashamed of money mistakes.

To continue reading, please go to the original article here:

https://finance.yahoo.com/news/10-bad-money-habits-learned-110038180.html

Confessions of an Overnight Millionaire

Confessions of an Overnight Millionaire “I constantly ask myself, Do I deserve this money?”

By Anonymous

What Is the Meaning of All This Money?

A series about the ever-more-chaotic future of finance.

Since July 2020, nearly 750 companies have gone public, raising more than $200 billion and minting thousands of new paper millionaires. Amid the frenzy, one millennial tech worker on the verge of unexpected wealth shared what was going through her mind.

When I joined my company, I theoretically knew there were only two exit paths — an acquisition or an IPO. And a third, where the company implodes, like WeWork, but you’re hoping for one of the first two. I didn’t really think about it when I signed on. I thought that I’d make a little bit from an IPO, maybe $200,000. You don’t think much about $200,000; it’s not life-changing.

After I joined, people would say things like, “I think I’ll retire off this money.” I thought they were delusional. Then, last year, a friend called and said, “Are you ready to be a millionaire? Check the news.” That’s how I learned my company was IPO-ing. I had no idea. I would be making north of $6 million.

It’s not purely a celebratory time. It’s a stressful time, too, because of the constant decisions. The amount of money is so large that if I make a 5 percent fuckup, that’s hundreds of thousands of dollars.

I’ve been interviewing wealth managers, and honestly I couldn’t be less impressed. If I were a wealth manager, I’m exactly the client I would want. I’m young, and I could be a client for 50 years. So these people should be thirsty, but they’re not. The wealth-management firms are old school — I don’t think they’re designed for people like me.

I was video-chatting with one guy, and he didn’t know how to do a screen-share properly, so he was showing his entire screen, including windows that I probably shouldn’t have seen. And I was like, I’m going to trust you to oversee my millions? I was asking another, “How do you evaluate a tech stock?” You can’t just look at the financials — you have to look at the market, how the technology is unique. There’s a lot of industry understanding they lack. They’re using principles from the 1990s.

There are things that rich people do, and hiring someone to manage your money is one of them. I’m wondering, Is this something rich people do because other rich people are doing it? Is this industry a farce?

To continue reading, please go to the original article here:

https://archive.is/P5S5A#selection-1209.0-1521.628