Archive for the ‘Money’ Category:
Start saving with(out) a bang!
The Fourth of July holiday came and went quietly in Garden City. Our current hot, dry conditions prompted a full ban on fireworks in Finney County this year.
The peace and quiet of this year’s holiday got me thinking about Independence Days past and comparing the many bright flashes of fireworks that have been visible in previous years. And I wondered– how much money did we all save this year without fireworks?
So here’s a suggestion– take the amount that your family DIDN’T spend on fireworks and put it into savings now. Let it start your savings program with a bang! The money saved by not buying fireworks could be the beginning of your fund for Christmas or back-to-school expenses or other special future needs.
In typical years, a lot of money goes up in smoke on the Fourth of July. This year, conditions forced us to save. So, make those savings real– deposit your fireworks fund and let it grow for future family needs. Money in the bank– now that’s a real cause for celebration!
“Knowledge for Life” provided by the Finney County Extension Office and K-State Research and Extension.
Subscribe to the comments for this postSaving for retirement and a child’s education at the same time
Saving for your own retirement and a child’s college education at the same time can be a challenge. You want to retire comfortably when the time comes, but you also want to help your child get a good education. How do you take steps now to accomplish both goals? Here are a few pointers from 360 Degrees of Financial Literacy, a website of the American Institute of Certified Public Accountants.
Estimate Your Financial Needs
The first step is to determine what your financial needs are for each goal. For example, how many years until retirement for you and college for your child(ren)? What do you expect to receive for retirement from your employer and/or Social Security? What standard of living do you want in retirement? What’s the expected cost of your child’s preferred college? Gather the facts and set goals now. Periodically meet with your company’s retirement representative and visit college websites to stay on track with your estimates.
Retirement Takes Priority
Although a child’s college education is certainly an important goal, you should probably focus on your own retirement if funds are limited. With generous company pensions mostly a thing of the past and Social Security in a financial strain, the burden is primarily on you to fund your retirement. Make it automatic- enroll in your employer’s retirement savings plan and take advantage of matching funds, if offered. Or, set up your own automatic savings transfers from a checking account to a retirement savings account. If you wait until your child is in college to start saving for retirement, you’ll miss out on years of tax-deferred growth and compounding of your money. Remember that a child can get help to attend college by taking out loans (or maybe even receiving scholarships), but no one will give you a loan or a scholarship for your retirement years!
Saving for Both Retirement and College
Ideally you’ll want to try to save for both retirement and college at the same time. Here are some tips to consider:
- Work longer- The longer you work, the more money you’ll earn and the later you’ll need to dip into your retirement savings.
- Reduce your standard of living, now or later (or both)- You might be able to adjust your spending habits now in order to save money for later. Or you may consider a more frugal lifestyle in retirement.
- Increase your earnings now- Consider increasing your hours at your current job, finding a new job with better pay, taking a second job or having a previously stay-at-home spouse return to the workforce.
- Expect your child to contribute more to college expenses- Encourage your child to work and save during high school for future education needs. Help them find and apply for all scholarships which they might be eligible for. Expect them to work part-time while in college and explore student loans if funds are still short.
- Send your child to a less-expensive school- A pricey “brand-name” private school may be your child’s dream, but unless they receive a generous scholarship, they may need to lower their expectations. A state university or a smaller liberal arts college might provide a similar education for a far lower cost.
- Get creative to reduce education costs- Take dual-credit classes at a local community collge while in high school, attend a local college and live at home to save on room and board, enroll in an accelerated program to graduate in three years instead of four, take advantage of cooperative training where paid internships alternate with coursework, or defer college for a year or two and work to earn college funds.
“Knowledge for Life” provided by the Finney County Extension Office and K-State Research and Extension.
Connecting health and wealth
Two recent trips to the emergency room for a suspected gall bladder attack sure got my attention. After all, in my family I’m the healthy one! But during my evaluation, the emergency room nurse could hardly believe that I don’t take any medications– she had so much doubt, in fact, that she repeated her question about what pills I take and seemed surprised when I told her I don’t take any.
Does that mean most folks do (take regular medications)? My emergency room experience got me thinking about how valuable good health is and how many of us live lifestyles which may put our good health at risk. How many of us pop a pill for high blood pressure, high cholesterol, high blood sugar, or other conditions which might be controlled or eliminated with better attention to our health habits? And how does this lackadaisical approach to our health affect our financial status?
The connection between health and wealth
“Your health may determine your wealth.” These words appear in Who’s Afraid to Be a Millionaire?, a book by financial journalist Kelvin Boston, who notes that healthy people often have long life expectancies, which gives their investments time to grow.
“Longevity nurtures prosperity,” explains Boston, who adds that good health gives you more time to build wealth. Conversely, those in poor health often experience the wealth-draining effects of disability, sickness, and premature death, including high medical expenses, lost earnings, and reduced productivity.
One factor in particular, Boston says, can erode financial well-being– the economic impact of preventable or treatable illness. Examples include hypertension, diabetes, overweight and obesity. Boston summarizes simply, “good health is one of the best investments you can make.”
Invest in good health
People “invest” in their health through healthy lifestyle choices, just like they invest in wealth-building assets such as a college education or shares of stock. Every time you choose healthy foods, get regular vigorous exercise and adequate sleep or lose a few pounds, you are making a deposit in your health “account.” But if you are content to pop a pill rather than hit the gym, lose the weight, or eat those vegetables, you may be short-changing the financial benefit that comes from good health. So, take your health seriously and do all you can to get healthy and stay healthy– you may even become more wealthy as a result!
For more information and motivation, check out Small Steps to Health and Wealth– an online resource complete with competitive and non-competitive challenges created by Rutgers Cooperative Extension in New Jersey.
“Knowledge for Life” provided by the Finney County Extension Office and K-State Research and Extension.
Five things you may not know about retirement savings
Retirement planning is vital, but often plagued with myths and misconceptions. To make sure you’re on the right track, consider these eye-opening facts:
1. You’re never too old to save. There’s still hope, even for late-comers. Anyone over age 50 can make catch-up contributions of as much as $5,000 to a 401(k) and an additional $1,000 to an IRA. It may not be easy to do, but a few years of serious savings can make a huge difference.
2. You’ll need more money than you think. A $1 million nest egg sounds like a lot. But, spread over a 30-year retirement, it amounts to about $50,000 a year. And, costs for health care, gasoline, and other living expenses will continue to go up while your retirement income remains fixed.
3. A company penison won’t cover it all. Baby boomers will get far less financial help from employer pensions than their parents did. According to the Employee Benefit Research Institute (EBRI), the average annual pension payout for ages 65 and older is around $10,900.
4. You may not be able to pick your retirement date. Your strategy for retirement saving may be to work as long as possible. While about a quarter of employees aim to work until age 70, just 8 percent of current retirees managed to stay at work that long, according to EBRI. Health problems, layoffs and the need to care for a family member typically drove their decision to leave the workforce.
5. Your personal savings will be the key. Personal savings typically make up half of the income stream for retirees. Take advantage of generous contribution limits for IRA and 401(k) savings plans for older workers, and save as much as you can afford to set aside. If your employer offers matching contributions to your retirement fund, make sure you are putting in enough to obtain the company match.
There are many resources for those wanting to learn more about retirement savings. However, here are a couple of my favorites: Catch Up Strategies for Late Savers, from eXtension, the national database of University Extension resources. Women should also check out WISER: Women’s Institute for Secure Retirement for information on retirement issues unique to women.
“Knowledge for Life” provided by the Finney County Extension Office and K-State Research and Extension.
March 29: Extension information on Leaving a Legacy
Explore a variety of ways that someone can leave a legacy to support the organizations and causes of their choice.
On Tuesday, March 29, at 12:00 noon join us for the Extension educational program “Leaving a Legacy” in the Grandstand Meeting Room of the Finney County Fairgrounds in Garden City. The guest speaker will be Douglas Beech, Kansas 4-H Foundation Planned Giving Officer. A light lunch will be provided with this free program.
This program will give a brief overview of the major tools– some familiar, some not– that allow someone to preserve and pass on their values through their estate plan. This program will focus on general how-to information and will not address or promote specific charities.
This information will be valuable for individuals who might be interested in leaving a legacy, but also for churches, organizations and boards which accept contributions from others.
Please pre-register at the Finney County Extension Office, 620-272-3670, by Monday, March 28 to ensure adequate program materials and meal supplies.