• Insurance,  Retirement Planning

    The Bills and The Fees: How to Talk to Your Parents About Money (Without Making It Awkward)

    If the thought of talking to your parents about money makes you cringe, you’re not alone. In fact, the majority of Americans would rather talk about “the birds and the bees” than “the bills and the fees” of finances with their own family. When given the choice, we would prefer to talk about our own DEATH than asking our parents about their will or estate. (Now, that is just ridiculous). There’s no question that money is a taboo topic that makes you want to run 100 mph in the other direction anytime you hear the words “budget” or “debt.”

    But, why is it so uncomfortable to talk about cash money with our family? And does it even really matter? After all, you’ve made it this far without diving into the depths of financial awkwardness with your parents. What’s the worst that could happen?

    Well, here’s a few stats for ya:

    • 52% of people turning 65 will need some form of Long-Term Care
    • 64% of people with Long-Term Care needs rely exclusively on friends and family for care
    • 25% of all caregivers are Millennials
    • Average annual cost of caregiving ranges from $18,000 (Adult Day Care) to $91,00 (Private Room in Nursing Home)
    • 55% of Americans have no will or plan to transfer assets at death
    • Only 35% of Baby Boomers are confident that they are financially prepared for retirement

    To summarize these lovely statistics: the odds that your parents may eventually require some form of Long-Term Care (assisted living, nursing home, etc.) during their lifetime is 1 in 2 (a coin flip). The chances that you will need to help pay for some of these costs are also quite high, especially if your parents don’t have any kind of long-term care insurance coverage or other savings in place. AND, if your parents are in the minority of those who have already established a will, congratulations! But, even if they do have a will, are you sure it’s up-to-date? You’d hate for your mother’s ex-husband’s cousin’s half-brother to end up inheriting money that was meant for you, right? Yikes! Talk about awkward.

    With that said, yes. Having a conversation about finances with your parents is obviously very important. So, what are you waiting for?? Go ahead and throw those taboos to the wind and dive right in! OK, easier said than done, right? Let’s look at three simple conversation starters that will make the money talk a little less awko-taco.

    1. You’ve taken good care of me, so I want to take good care of you.

    When I was visiting my parents over the holidays, I asked them if we could set aside some time to talk about money. Specifically, I wanted my parents to know that, if anything should ever happen to them, I would be adequately prepared take care of them and their finances. Just as my parents have spent years caring for me and preparing me for my future, I want to be able to return the love by taking care of them when the need arises. We discussed what kinds of insurance policies, investments, and savings they have in place, where they keep financial records, and who they use as a trusted financial advisor. I didn’t ask to see any financial statements or specific policy information (because that’s usually where the awko-meter starts to rise) — only where this information is kept, so I know where to look if I need to access it at some point in the future. By emphasizing that my purpose behind the conversation was love and care for my parent’s wellbeing, we were able to talk open and honestly — without any hurt feelings or awkward outcomes.  

    YESSSSSSSS

    2. I’m interested in visiting a financial advisor, but I’m not sure where to start. Would you mind introducing me to yours?

    This is a win-win conversation starter. Not only does it provide you an opportunity to visit a financial advisor for the first time (without spending lots of money), but it also provides an ideal environment to discuss difficult financial topics with your parents. Their advisor can guide the conversation and act as a third-party mediator if needed. While meeting with the advisor, you may want to discuss your parent’s current retirement plan, including protection against long-term care events, and to review any beneficiaries on your parent’s insurance policies to ensure they are up-to-date. (You’d be shocked how often an ex-wife, ex-husband, or estranged family member ends up receiving a death benefit, simply because policy information was not current). AND, while you’re in the office, you might as well glean some insight from the advisor on your own financial plan. Most likely, the advisor will be more than willing to assist you, as they see you as a potential future client. (If the advisor doesn’t see your value, you may want to look for another advisor).

    Even if your parents don’t already have a trusted financial advisor, this is the perfect time to find a reputable professional together. It will be an opportunity to bond as a family, while also tackling your finances in an efficient and holistic manner.

    3. Do you have a legacy plan? AKA: If you die tomorrow, what kind of legacy to do you want to leave and how do you want it accomplished?

    Most people don’t like to think about dying until a death actually occurs. Can’t blame you. Death isn’t the first topic that comes to my mind when I think of “fun conversation starters.” BUT, the problem we create when we avoid talking about death is that we miss out on the opportunity to plan for a legacy — until it’s already too late. While your parents may want to leave their house behind to the family, donate their art collection to a local museum, and divide the rest of their assets equally among you and your siblings– if they don’t have these wishes expressly written in a will, they’re not likely to happen. When someone dies without a will (called intestate in legalese), your state will then determine how your assets should be dispersed. This could be okay, except that your state has no idea that you don’t even really like your spouse, you’re estranged from your son, and your daughter is a compulsive shopper who blows every penny she has on lottery tickets. But, the state doesn’t really care about your family issues. It will still divide up your assets among each of these individuals anyway. (Sorry ‘bout your luck).

    Contrary to popular belief, establishing a will (and keeping it current) is not as much of a headache as many people think. For a simple estate (think: relatively small and not paying estate taxes), it may only cost around $100-$150 for an attorney to draft a will. (If you’re looking for a lawyer, start here). Or, you can also write your own will by using a reputable online software program or following a template. HOWEVER, if you complete your will on your own, you are doing so at your own risk, as each state has different regulations surrounding what is required to validate a will and, if done incorrectly, it may not hold up in court.

    I’ve only scratched the surface on the importance of writing a will (both you and your parents). And I haven’t even started to explain all of the incredible information that can be contained in a will, such as designating power of attorney or establishing a living trust. But, I realize I’ve already bored you to tears, so I’ll save these enthralling topics for a different time. (Psst: stay tuned for an upcoming Face The Fear Podcast episode on Estate Planning 101, coming soon!)

    In summary, you know you should probably strike up a conversation with your parents about money. It’s on your to-do list, right below “Clip grandma’s toenails” and “Watch paint dry.” At least now you’ve got a few conversation starters in your back pocket to break the ice. I promise, it won’t be as bad as you think. (Or, maybe it will be. In that case, I don’t know you). Either way, challenge yourself to start a conversation with your family about finances this week. Even simply cracking the door open today could provide fruitful opportunities for future discussions and prevent a flood of heartache, confusion, and financial strain later in life. Friend, it’s time to #FaceTheFear!

    Written By: Kaitlyn Duchien

    Contact Us: facethefearfw@gmail.com

  • Insurance

    Life Insurance: What Kind Is Best For Me?

    Welcome back! Hopefully you read my last article, where I discussed three reasons why considering life insurance should be a priority. If one of these reasons resonated with you, or you have one of your own, I want to give some thoughts as to the different types of life insurance. Broadly, there are two categories: term insurance and permanent insurance.

    Term insurance is simple – you pay an annual premium for the number of years in the term, and, other than a few exceptions, the insurance company will pay your beneficiary the death benefit if you were to die during the term of the policy. For example, I own a 20 year term policy, running from 2018 to 2038. If I were to die in 2030, my wife would receive the $1,000,000 death benefit, tax-free.

    Permanent insurance is a little more complex. Within the category of permanent insurance, there are several types, but we will focus on the two main “flavors.”

    First, there is “protection-based” permanent insurance. Protection-based permanent insurance is designed to provide a death benefit for your entire life. Instead of securing a death benefit for a 20 year period, this kind of policy can provide a death benefit to your beneficiary regardless of how long you live.

    Second, there is “accumulation-based” permanent insurance. It also has a death benefit, but is really designed to grow cash value within an account housed at the insurance company. A portion of the premium you pay goes to cover the cost of your death benefit, a portion goes to the insurance company’s operating expenses, and a portion goes into an account for you. As you pay premiums, the cash in the account grows. Depending on the strategy of distributions, you can leverage this cash value in tax-advantaged ways.

    So you are probably thinking…why wouldn’t I always buy permanent insurance over term, as it has much more benefit?

    You guessed it: permanent insurance is more (and can be much more) expensive than term insurance. But, most millennials are at a point in their financial journey where permanent insurance is not only too expensive, but is unnecessary. You are likely better off focusing on maximizing your contributions to tax-advantaged accounts like a 401(k) or IRA, but also securing term insurance to protect your finances. (And, if you remember from the last article, term insurance sometimes can be converted into permanent insurance!)

    Remember: the cheapest day to buy life insurance was yesterday. If you just need term coverage, you are in good company. If you can afford permanent coverage, that may be a better fit. Either way, make sure you are protecting the financial plan you work so hard to build.

    Want more information on life insurance? Let’s talk! Face The Fear is here to help millennials make smart financial decisions that fit their lifestyle.

    Article Contributed By: Xavier Serrani

    Contact Us: facethefearfw@gmail.com.

  • Budgeting,  Student Loans

    Student Loans: How I Managed the Madness

    The choice to go to college is a big commitment.  It’s a commitment to yourself and it’s a commitment to the payment that accompanies this hope for a successful life.  Some people are lucky enough to have the financial burden of a college education taken off their shoulders by parents, family members, sponsors, etc. And some people are extremely diligent, work incredibly hard, save up, and pay for college themselves.

    I, however, am neither of those people. I am with the group that I would assume is the majority: the unfortunate souls who had to take out student loans to attend college. Through my own personal experience, I have learned a few lessons on how to avoid some of the student loan burden before you jump into college, as well as how to alleviate some of that burden once you’ve crossed the stage with diploma in hand.

    My first tip comes from something that I did not do enough: Be involved in the process of applying for student loans. Do your research. Knowing what you are getting yourself into is half the battle in being prepared when your loans finally come due.  My mother was nice enough to walk through the loan application process with me. Although I was fortunate to have her assistance at the time, I still did not fully understand what I was getting myself into or how much time it would take to repay the loans after graduation.

    Let me give you a snapshot of what my college expenses entailed. I attended a lovely private university in my home state of New Jersey. Fortunately, I was a good student in high school and received $12,000 per year in scholarships. I also commuted an hour to the university each day to save money. But even with scholarships and without the cost of on-campus housing, the tuition still added up to approximately $30,000 a year. And that’s not even counting the cost of textbooks, which amounted to $500-$1,000 each semester!  So how was this all paid for?  We took out student loans; sometimes per year, sometimes per semester.

    All the loans that I took out were fixed rate as opposed to variable. I didn’t know much, but knew I wanted to have a set payment. (Fixed rate means you have the same interest rate for the life of the loan and variable means the interest rate can move around). I consider myself to be mostly conservative, especially when it comes to my debt; so, for me, fixed rates were the better choice. With a variable rate, you are subjecting yourself to the possibility of rates changing, potentially increasing or decreasing throughout the life of your loan. One option is not better than the other; it simply depends on your financial outlook and how you want your future payments to be structured.  

    Fast forward four years and I am a college graduate! Thankfully, right after graduation, you are not expected to pay your loans immediately. So, go out and live it up! Because in a few months, it’s about to get real! 

    No, please don’t do that.  Plan for your payments and prepare yourself for the abuse you are about to take.

    After I graduated and my student loans came due, it was the biggest slap of adulthood I had ever received.  I had about eight separate loans, all at varying interest rates, coming to a grand total of around $100,000.  My monthly payment totaled out to approximately $950. Combine this payment size with the fact that the first job offer I received out of college was $28,000 per year as a junior business analyst. $28,000. You can imagine how I felt: COOMPLETELY DOOMED!

    I took a step back to figure out what steps I could take to reduce the financial burden and the feelings of doom. First, having eight separate payments is a nightmare. Secondly, all the varying interest rates made some payments seem like a good deal while others seemed to be a rip-off.  Finally, the biggest issue was obvious: paying $950 a month while making $28,000 a year was not going to work. 

    The solution I discovered was to consolidate and refinance my loans with a longer payment period. Consolidation, simply put, allowed me to take all my separate smaller loans and combine them into one larger loan.  Refinancing student loans is just like refinancing a mortgage. In ideal circumstances, a new loan at a better rate will replace your existing loan, although this might not always be the case.

    A plethora of private companies and banks promote assistance with student loans, such as College Ave, Earnest, and SoFi. Many of these organizations allow you to fill out a free online application to determine if you “pre-qualify” for their services. When I began searching the internet for a solution, SoFi and Earnest offered the best interest rates to consolidate and refinance my loans. Here’s the catch: unless you are either making close to $100,000 a year (aka making BANK) or have an extremely solid cosigner (someone who loves you very much and is willing to put their name on your loan so the lender feels more comfortable), the qualifications to be accepted by these companies are quite high. However, through diligent searching and applying, I was able to consolidate and refinance my loans through Citizens Bank. While the process of finding the right company to assist with your specific situation may take time and effort, it is fairly easy and well worth the effort.

    Once I was approved by Citizens Bank, the final step was to choose the term of my new loan. Ultimately, that’s what the consolidation and refinancing process is all about: taking out a new loan to pay off your inconvenient, higher-rated current loans. Here’s the basic principle when selecting the term of a loan: the shorter the term of the loan, the less you will pay in total interest, but the higher the monthly payments will be. The longer the term, the more you will pay in interest, but your monthly payment will be lower over an extended time period. In my case, I chose the longest term possible. As much as I want to pay off my loans quickly, I also need to keep my everyday living expenses in mind.  Also, the loan that I chose allows me to pay early without penalty. So, if I can contribute more than my required payment, I will be able to pay the loan down more quickly. Even if this is a rare occurrence, it’s a nice feature to have. Not all loans allow this, so it is worth asking if this feature is available when refinancing your own.  

    Ultimately, the consolidation process brought my number of payments down from eight to one. The refinancing process reduced my interest rates to a more realistic average, and the longer maturity allowed me to pay a lower monthly payment. Although I did extend the amount of time I will be making payments, the cost of the payment is much more manageable for my current situation, and it addressed the problems I needed to fix. I know I am not the first or the last college grad to feel the wrath of student loans. But, being able to share my experiences, ideas, and relate to others is an important step in finding solutions. 

    Article Contributed By: Christian Boyle

    Contact Us: facethefearfw@gmail.com



  • Budgeting

    Budgeting: How to Crunch Those Numbers Like a Boss

    Like most folks who hear the term ‘budget’, I cringe, close my eyes and begin groaning inwardly like Tina Belcher from Bob’s Burgers (No? Just me? Oh geez…).

    In the past, I would search for budget templates online, attempt to follow them, realize they didn’t fit my tastes or my lifestyle and I would walk away defeated. I would wonder what was so wrong with my finances that I couldn’t match exactly what some of these articles were telling me.

    But that’s the uniquely wonderful (and yes, incredibly frustrating) thing about budgets: they aren’t black & white or one-size-fits-all; they can be tailor-made to fit your specific lifestyle, needs, and wants. I say ‘incredibly frustrating’ because it does take time and a fair amount of effort to find a budget that works for you—your wants and needs are going to change and with that, so will your budget.

    At the end of each paycheck, for me, there’s a sense of strength that comes from knowing where each of my dollars are going and knowing what I’m left with to play with however I choose. Full disclosure: that’s my favorite part about budgeting because I love seeing what money I have left over and let’s admit it, we all want to have fun with our money—after all, we work hard for it!

    I’ve been creating a budget for the past 6 years or so and I have found a few things to be invaluable in my attempt to understand and control where each of my hard-earned dollars are going:

    1. Know your debt intimately. When I started creating a budget, I couldn’t tell you which of my debts had the highest interest rate or what their balances/minimum payments were; it honestly gave me a headache every time I tried to write it all out. Knowing this info gives me the opportunity to see where I am and where I can send extra cash. Small amounts add up over time & it feels so good to see $0 next to a debt I owe.

    2. Figure out some financial goals. These can be as little or broad as you would like them to be but I normally create small goals to feel encouraged in continuing to hit some of my larger goals. I ask myself where I’d like to be in 3 months, 6 months, and a year! And, as a side note: I treat myself when I accomplish a financial goal—it keeps me inspired and reminds me that even though ‘adulting’ and ‘budgeting’ aren’t exactly the most thrilling parts of life, they are necessary and we can make it as easy or hard as we want it to be.

    3. Be flexible. Always be open to changing whatever you feel isn’t quite working for you and your budget. Your goals are going to adjust over time and with that, your budget will too and that’s okay! I’ve tried several different budgeting techniques (the 80/20, the 50/15/5, etc) so be willing to try out different techniques until you find one that works for you. Your wants/needs change regularly, so why wouldn’t your budget?

    One last, small tip I’ll give to those preparing to create or change their budget is this : give yourself lots of grace. You’ll fall short, not reach certain goals, or get that call on a Friday night from your BFF who’s had a rough week and she wants to go out to eat and grab a few drinks—in those moments, it’s challenging. All you can do is adjust, pick yourself back up, and attempt to stick to it better next time.

    There are also tons (and I mean literal tons) of information and resources out on the world-wide web that can get you started on creating a budget or finding example budgets to follow and use as a rough outline for your own.

    Article Contributed By: Bethany Trosper

    Contact Us: facethefearfw@gmail.com

  • Budgeting

    New Year, New You: 5 (MORE) Ways You Can Take Control of Your Finances in 2019 

    Earlier this week, we talked about 5 simple ways to get your financial sh*t together in 2019. If you’re looking for that article, here it is! If you have been sitting on the edge of your seat waiting eagerly for the 5 MORE ideas to tackle your finances in the new year…well, my friend, you need to get a life. (Just kidding! You’re my favorite). Wait no longer. Here are 5 MORE ideas to show your finances who’s boss in 2019:

    1. Start that Side Hustle

    Everybody’s got a knack for something. Whether it’s photography, writing, event planning, car-fixing, baking, nannying, or playing music, your “knack” can be turned into a side-hustle money maker. The New Year is an excellent time to begin monetizing your skill set.

    Think you don’t have any valuable skills that can translate into a profitable business? Think again. Can you drive a car? (Think: Uber and Lyft). Can you put together a piece of IKEA furniture faster than your mom can say, “Honey, make sure you read the instructions”? (Think: TaskRabbit) Can you speak English? (I hope so if you’re reading this article. Think: Teaching English online through VIPKID). Can you take a BuzzFeed survey to find out what your spirit animal is? (Think: SwagBucks). Can you walk someone else’s dog? (Woof! Think: Rover).

    I prove my point. It’s easier than you may think to pick up a few extra dollars here and there. You just need to dedicate a little time and energy to get it started. Ultimately, those extra bucks could jumpstart your emergency fund or pay down a credit card faster. Score!

    2. Find a Financial Mentor

    If you’re interested in seeing a financial advisor, but aren’t sure where to start looking or don’t feel like it’s the right time yet, finding a financial mentor may be the perfect first step.

    Like most mentors, a financial mentor is someone who has walked the path before you, achieved success with managing their own finances, and can help illuminate your way. This person could be a parent, coworker, friend, teacher, pastor — really anyone who you admire for their practical, disciplined, and knowledgeable approach to money. The purpose of this mentorship is simply to establish a relationship with someone who can provide constructive advice, hold you accountable to your financial goals, and even recommend a financial advisor who’s a good fit for you. Ideally, your financial mentor will be someone who you know, trust, and feel comfortable discussing finances with — and who isn’t afraid to call you out on your BS and give you some tough love when needed.

    BUT, remember: a financial mentor is not a replacement for a financial advisor. While it may be tempting to imitate every financial decision your mentor has ever made in hopes of achieving the same success, your mentor’s approach may not be suitable for your unique circumstances. Take all advice given as a mere suggestion and make sure to run it past a financial professional first. Your mentor cannot be held liable for a poor investment suggestion or financial strategy that went sideways. (Sorry ’bout your luck).

    3. Face the Fear of Money Talk

    Asking a coworker how much money they make? GASP! I would never. Pestering my parents to purchase life insurance, long-term care, or write a will? No way. Too uncomfortable. Touching the topic of student loan debt on a first date? WOAH. Now that is just too far!

    (OK, maybe not on the first date).

    As a society, we have become afraid of talking about money, and all of this secrecy is ultimately hurting our finances. Why?

    Consider this. You just received a job offer in a brand new city. YASSSS! After your initial excitement settles, you realize that #1, you have no idea what a reasonable job offer may be for this position and #2, you have no idea what a reasonable apartment costs in this new city. Thankfully, you have tools like Glass Door and Apartments.com to assist with these decisions. However, can you imagine how much more straightforward it would be to simply ask someone in that position what they are being paid or ask someone in the city how much they are paying for their apartment? For whatever reason, money has become a taboo topic that most Americans feel uncomfortable discussing. It’s time to change that — for everyone’s benefit.

    Here’s a New Year’s challenge to spark up these conversations at least once in 2019. (But remember, these are still sensitive conversation topics for some, so please use tact. And if you’re going to ask the question, be willing to answer it yourself):

    • Ask a coworker how much they’re making. (Just in case you asked yourself, “But, is that even legal??” Yes, it is.)
    • Ask your boss if there are opportunities for promotion and set up a plan to get you there.
    • Ask a friend how much they are paying for their apartment.
    • Ask your parents if they have life insurance, long-term care, and have written a will. (P.S. These are hugely important topics that no one ever talks about until it’s too late. Don’t be that person).
    • Ask your significant other how much personal debt they have (credit cards, student loans, car loan, etc).
    • Ask your kids if they have any questions about money, (such as how much you make, how much it costs to buy a car or a house, how much a college education costs, etc). Talking openly and honestly with your kids about money could be the single most influential way to improve the financial habits of the next generation.
    • For the ULTIMATE challenge-seekers: Ask a stranger if they feel financially stable. Their response could be eye-opening, and it may spark a life-changing conversation unlike any you’ve experienced before. (Or they may just say, “Nope!” and walk away. Who knows).

    4. Make Your Money Do The Work For You

    Investing. You’ve heard about it. You know you should probably do it. And you’ve watched The Wolf of Wall Street and The Big Short, so you’re basically an expert.

    OK, pump the breaks. You may not be an expert, but you definitely don’t need to be one to start putting your money to work for you.

    If you have a retirement account such as a 401(k), 403(b), or IRA, you’re probably participating in the stock market already through the mutual funds inside these accounts. In other words, you’re halfway to being the next Warren Buffett. (Just kidding. But dream big, kids).

    So, how do you start investing when you’ve only got a few dollars to spare and your current investment knowledge is limited to binge-watching Shark Tank?

    The most old-school, yet time-tested method is to begin working with a financial advisor who is a Registered Representative with FINRA. (How do you know if an individual is registered with FINRA? Check here). This professional can evaluate your current financial situation, assess your risk tolerance, and pair you with suitable investments that both align with your goals and your personal values. Fortunately, we will be speaking with one of these fantastic professionals on our February Face the Fear Podcast episode! Make sure you’re subscribed so you don’t miss it.

    An alternative is investing through robo-advisors and investment apps. While you’re missing out on the face-to-face interaction and personal relationship built with a financial advisor, these online tools can be a beneficial and inexpensive option for beginners who don’t have billions of dollars to invest (yet).

    As per usual, here’s a quick disclaimer. Investing is one method of wealth accumulation that should be accessible to everyone, regardless of net worth or investment experience. However, investing does involve risks along with it’s rewards. So, make sure you are fully aware of these risks and have received all required informational materials (such as a prospectus) PRIOR to chucking all of your pretty pennies into an investment. Also, here is a Beginner’s Guide to Investing published by the SEC (Securities and Exchange Commission — an independent federal agency established to protect investors). You’re welcome.

    5. Subscribe to Face the Fear (Shameless Self-Promo)

    You know you want to.

    Written By: Kaitlyn Duchien (@ktaylor1395)

    Contact Us: facethefearfw@gmail.com

  • Budgeting

    New Year, New You: 5 Ways You Can Take Control of Your Finances in 2019

    New Year, New You — am I right? As you start to prepare for 2019 to be your best year yet (and vow to actually USE your gym membership for more than a month), don’t forget about getting your financial sh*t together, too. Even if you don’t feel like you’re in a good place with your cash money, now is the perfect time to assess what money mistakes you’ve made in the past, what financial goals you have for the future, and how you’ll start taking baby steps to get there.

    For those procrastinators out there who wish they’d started investing/saving/budgeting earlier in life (myself included), it’s not too late! Hear me out: starting today is WAY better than never starting at all — or even waiting a year from now and having the same conversation with yourself all over again (not a cute #ThrowbackThursday moment).

    So as we gaze longingly to the year ahead (or at least longingly at that last remaining Christmas cookie calling your name), let’s look at 5 ways you can get your finances in check during 2019:

    1. Open a Retirement Account (and start contributing to it)

    This is important. You know this is important. But, it doesn’t seem like a top priority when you’ve got student loans, credit card debt, and bills knocking at your door today, and retirement is still decades away. You’ve still got plenty of time to save up, right? Wrong.

    Let’s use a little analogy. Every year before Christmas, you have a mental conversation with yourself that goes something like this: “I really should get my Christmas shopping done early this year. That way I don’t have to stress about it later….Eh, I’ve got plenty of time, I’ll get around to it.”

    Suddenly, you wake up and it’s December 24th (how did that happen??). You now have to enter beast mode to somehow find, buy, and wrap presents for all 287 members of your family in 24 hours — putting Santa himself to shame.

    While pulling off this Christmas magic may be possible (think: STRESSFUL), it’s not the end of the world. Your retirement savings, on the other hand, is a different story. You really only have one shot to make sure you’ve got enough buckaroos saved up, so when you’re ready to leave the office and spend the rest of your life on a beach, you don’t have to worry about running out of money. Right now, time is on your side, so START NOW. (You’ll thank me later.)

    If you’re wondering where to go to open a retirement account (and what to do with it once it’s started), listen to our latest podcast episode with Retirement Investment Advisor, Erin Martin!

    2. Boost Your Retirement Account (if you’ve already got one)

    You may have breezed past #1 thinking, “Well, that’s easy! I already have a retirement account that I’m contributing to like a real adult.” First of all, CONGRATS! You’re #winning.

    Second of all, it’s time to supercharge that bad boy (like Vin Diesel hitting the NOS in Fast and Furious).

    One way to do this is by upping the percentage of your paycheck that you’re putting away for retirement savings. Simply increasing your contributions 1% per year (hardly a noticeable difference to your take-home pay), you might be AMAZED by how quickly your retirement savings compounds over time. To make things even easier, many plans allow you to select an automatic escalation feature, which will bump up your percentage each year without any effort on your part. Nice.

    3. Make a Budget You Can Actually Stick To

    Remember that one time you made a detailed budget that lasted for a solid two days before you blacked out during an Amazon shopping spree? Same.

    The problem with a lot of budgets (and New Year’s resolutions for that matter) is that they are very optimistic, but not always realistic. I’m not saying you need to lower your financial goals. But, instead of trying to pay off all debt overnight while also saving 50% of every paycheck, simply develop practical mini-goals that can be maintained long-term. For example, try implementing one new budgeting strategy each month in 2019. January, put $10 per week in savings. February, continue setting aside the $10, but also aim to eat out only once per week. In March, keep the first two month’s strategies going, while adding another practical goal that bumps you even further in the right direction. By the end of the year, your budgeting baby steps will snowball into a realistic, maintainable financial lifestyle.

    P.S. If you’re not already using a budgeting app like Mint, what are you doing? Seriously. Go download it right now. It’s a free app that allows you to manage your checking and savings accounts, investments, credit cards, retirement plan, and bills all in one place. Say goodbye to budgeting on boring Excel spreadsheets forever (unless that’s your thing — you do you, boo boo).

    4. Give Gifts that Make Cents

    Christmas is officially over, which means your finances are probably in recovery mode after a month of generous gift giving. While there’s nothing quite like the feeling of finding the PERFECT gift for your loved ones, the feeling might be quickly overshadowed by the feeling of doom when you check your bank account. Yikes.

    Since you can’t avoid the gazzillion birthdays, weddings, and special occasions happening throughout the year (as much as you may want to), it’s time to get creative with giving gifts that won’t break your bank.

    Here’s a few ideas:

    • For the person who doesn’t need anything:
      • Consider donating to a local charity or Kiva (an international nonprofit microloan organization) on their behalf. You’re not giving them anyTHING, but you are providing meaning in their honor and bettering the world in the process. Win-win.
    • For the person who loves experiences:
      • Score discounted tickets to local events on platforms like Groupon. Take a historic tour of your city, attend a concert or comedy show, or try a ballroom dancing class — all experiences that you can enjoy together.
    • For the person who likes to pick out their own gifts:
      • Sell or exchange your unwanted gift cards on platforms such as Cardpool or Amazon’s Card Cash. You can either swap out that gift card your grandma gave you to the iTunes store back in 2008, sell it and use the cash to buy something better, or buy discounted gift cards to help your funds go farther.  

    5. Subscribe to Face the Fear (Shameless Self-Promo)

    You know you want to.

    5 (MORE) ideas of how to take control of your finances in 2019 coming soon! Stay tuned!

    Written By: Kaitlyn Duchien (@ktaylor1395)

    Contact Us: facethefearfw@gmail.com

  • Retirement Planning

    401(k): HALP!

    If you’re like me, you’ve probably sat through a 20-minute session or two on setting up your 401(k) account. And if you’re like me, you walked out nodding like you heard some really great advice, but it sounded more like a foreign language. You might have checked the boxes for the “most recommended” allocations for your age group and called that “good enough.” You may not even know how much is going toward your 401(k) each paycheck, or what the balance is currently, or if that’s “good” or “bad” … or…. OK, how much does it matter? HALP!

    While it’s sometimes difficult to imagine retirement or know how to plan for it so early, I couldn’t help but wonder about my own future.

    For most of us, our employer offers us a 401(k) account – but we’re in charge of contributing. So, let’s consider how those contributions actually impact the outcome (account balance) and, more importantly, the value on the day we are ready to cash out.

    The 401(k)

    A 401(k) account is a tool employers offer as an incentive for their employees to save and plan for their retirement. It’s a type of savings/investment account that allows your money to grow tax deferred.

    Part of the incentive could be your employer’s match. Not all employers provide a match. (*cough, cough* This is something you should look into if you don’t know.) Anyway, for every “X amount” you contribute, your employer will also contribute or match “Y amount.” As a rule of thumb, you’ll want to take advantage of this match, so you’re not walking away from the money they’re willing to offer you. (It’s basically free money, people!) Beyond that, you can save as much as you’d like each year, up to the contribution limit, which is determined by the government annually. (P.S. The pretax contribution limit for 2019 is $19,000. You’re welcome).

    One major difference between a 401(k) and a traditional savings account is that you really shouldn’t withdraw your 401(k) money until you reach retirement age (which the government has decided is 59 ½ years old). If you do withdraw funds before then, you will pay a hefty 10% penalty. Yikes. While that 10% penalty may seem unfair, think of this as part of a sweet deal that you and the government have shaken hands on. You need to save money as quickly as possible for retirement, right? And you’d rather not pay taxes on that money now, so it will reap the full advantage of compound interest (aka grow faster). The government says, “OK, I won’t take taxes on that money now, because I would like you to have money to retire eventually. BUT, the one condition is that you can’t use that money to buy a new Ferrari prior to 59 ½ (unless you wanna pay a 10% penalty).” Remember, the government wasn’t born yesterday.    

    OK, so you’re putting this money in regularly – what happens to it after it hits your account? Remember that “most recommended” option you checked after you glanced over the pie chart? That allocation option determines a mixture of stock and bond mutual funds where your money goes to grow. The company holding your account (such as Fidelity, MassMutual,etc.), will keep track of all this for you (*takes deep sigh of relief*).

    While there may be predetermined blends of “conservative” or “aggressive” allocations, you can customize your selections — if you so choose — and those selections can be changed at any time. For some people, taking advantage of aggressive models might seem scary – to diversify, and put large amounts of valuable (vulnerable) money out there. But it’s good to keep in mind that time is on our side here.

    So, if you start to watch your account, you might see the balance fluctuate day to day; but just because the market may take a dip or seem “low” does not necessarily mean that you’ve lost a lot. It could actually be a good time to buy in, as the more time you have ahead, the more time the market has to correct itself and grow – to your benefit.

    And lastly, a little disclaimer (because we like those). I am not a financial advisor, so please make sure to consult with one of those amazing, qualified professionals to determine your own unique retirement plan. 

    Stay tuned for Part 2 of this article coming Thursday!

    Article Contributed By: Heidi Lengacher

    Contact Us: facethefearfw@gmail.com

  • Face The Fear

    Welcome!

    Welcome to Face the Fear!

    We are Nicole Ellsworth and Kaitlyn Duchien, two motivated millennials on a journey to face the fear of our financial future.

    We created this safe space where we will dive into topics like retirement, budgeting, student loans, investing, insurance, financial terms, etc. We are passionate about educating ourselves and others in the process. Join us as we change the conversation around finances and approach our future with confidence.

    If you like us, follow us here, Facebook, Twitter, Instagram and subscribe to our podcast: Face the Fear. (Social media links are on the top right of this page.)

    *Disclaimer: We are not here to give legal financial advice. We highly encourage you to bring the topics we discuss to a financial professional, who is qualified to address your specific financial goals.*

    It’s time for some real talk, and we are so excited that you are here to join us!

    Until next time – Face the Fear!

    Nicole and Kaitlyn

  • Videos

    Welcome to Face the Fear!

    Hi Friends! Nicole Ellsworth and Kaitlyn Duchien here. We are two motivated millennials facing the fear of our financial futures. Join us on the journey, as we dive into topics such as investing, retirement planning, life insurance, budgeting, and so much more.

    YouTube: https://www.youtube.com/channel/UC5PcXSzVvR9KZKWm4Ihh3pg

    Instagram: @Face.The.Fear

    Twitter: @Face_The_Fear

    Facebook: https://www.facebook.com/FaceTheFearFW/

    Podcast: Face the Fear (on iTunes, Spotify, and Stitcher)