planning

Opinion: I Don’t Want to Win the Lottery

September 27, 2019 By Flanice Lewis Leave a Comment

I don’t want to win the lottery. Specifically, I don’t want to win the jackpot. Of course, I could find a million or more ways to spend it. However, there’s so much stress that comes with the money that it may not be worth the trouble.

Taxes

The first reason I don’t want to win the lottery is the taxes. If you take the lump sum, you will receive a fraction of the jackpot. A Powerball winner in 2002 only took home $90 million of a $314 million lump sum after taxes. His take-home was more than enough, but that was based on a large starting amount. What if the jackpot was $1,000,000? I would pay over $300,000 in federal taxes alone. Also, when I pay state income taxes, that is more money out of the door. Taking the annuity option doesn’t eliminate the taxes either. It just reduces how much you pay in taxes upfront. And it’s not only cash you pay taxes on – houses, cars, and vacations are taxed too.

Selective Anonymity

The next reason I don’t want to win the jackpot is that I live in a state that will publicize my identity and location. There are only six states that allow anonymity if you win the lottery. Otherwise, everyone I’ve ever known that needs or wants something could attempt to contact me. There are stories of strangers and family members committing crimes to claim the jackpot winners’ money, which leads me to my next point.

Lottery Curse

There is a fabled “lottery curse.” Some winners lost their lives shortly after winning through malicious means. Others lost their lives due to drugs or alcohol. Others were left penniless because they didn’t know how to manage their new wealth. It does not affect every lottery winner, but there are enough stories to show the potential downfall of winning the lottery.

If I Did Win the Lottery

If I won, I’d take the annuity and keep working. A smaller amount at regular intervals would make it easy to budget. I like to think I’m good with money, but I’ve never had to handle millions abruptly or publicly. I would set up a will, estate plan, and power of attorney.

Winners are advised to get a lawyer, a tax accountant, and a financial planner. I would have all of those on my team of experts, but I would manage my money myself. Bernie Madoff and others have taken advantage of rich people with little involvement in their investments. I don’t want to be in that situation, so my advisors will not have access to my money.

I would pay off my debt and move into a tiny house to minimize my expenses. I would max out my emergency fund, long-term savings, retirement investments, income investments, and charitable contributions. After that’s all set up, I would give lump sums to my immediate family, then carefully consider anyone else’s one-time funding request. I would retire from my job once I am of age.

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Plan Your Financial Future with WeVest

August 2, 2017 By Mary Newton Leave a Comment

Financial planning apps are everywhere, and each has something different to offer. WeVest is a fairly new financial planning app that offers a new perspective on saving money and growing your net worth. The app promises a straightforward and inexpensive solution to you financial planning needs. But how well does it keep those promises?

How WeVest Works

When you create a WeVest account, you have to answer a few questions. In order to get your full financial picture, WeVest asks you basic questions about your assets, debt, income, age, and more. These questions allow their algorithm to create separate accounts on your dashboard for each item, as well as categorize you with peer groups who use the app. Then, WeVest asks about your saving goals. Their primary options are saving for retirement, building a college fund, and paying off credit card debt.

WeVest% and Your Financial Plan

The primary goal of WeVest is “to optimize the growth of your net worth in a way that achieves your goals.” Using your answers, WeVest algorithms formulate a financial plan specific to you, using the money you are willing to invest in yourself. Your WeVest% is the percentage of your income that you want to put towards growing your net worth. Your WeVest% is divided according to your goals – savings, retirement, college debt, etc. – in the most efficient way possible.

While this seems a lot like putting your money in someone else’s hands, fear not: WeVest also allows you to compare several recommended plans and pick the one you prefer. You have total control over your financial plan, supported by WeVest’s professional advice. In addition, you have constant access to that financial plan whenever you need it.

Once all your information is in and you have decided which financial plan you prefer,. Your dashboard shows how much money is going to which “bucket” – savings, debt repayment, retirement, etc. – for that month. You are given a graph that will measure and predict the growth of your net worth and savings, as well as whichever other buckets you prioritize. Finally, you can also see your exact current net worth with assets and liabilities, your financial plan, and a savings comparison between you and other users in your peer group.

WeVest Pricing

WeVest is not a free service. Their plans consist of a $4/month plan or a $35/year plan. Both plans have identical benefits, with the exception of the $35/year plan offering a 27% discount from the monthly plan. When you sign up, you have to select a plan and input your card information. However, you have a 45-day free trial before WeVest takes money from your account. You may also cancel your account at any time. This way, if you think you may use the app regularly, you can still sign up for the yearly plan knowing you have time before fully committing. This app boasts the low cost of its services in comparison to face-to-face professional financial planners.

WeVest Drawbacks

WeVest offers some fantastic insights into your financial planning, but it does have its drawbacks. Its primary drawback is its accompanying app. Rather than having an app which allows you to log in and view your information on your phone, WeVest’s mobile app is a simple calculator. It is free, and allows you to calculate simple savings projections for a large purchase, your child’s college tuition, or retirement. While these are useful, they are also pointless if you have an account with WeVest. Furthermore, toggling the “See The Full App” option within the mobile app simply opens the WeVest page in your mobile browser.

WeVest also caters more toward adults starting in their mid to late twenties with a stable, full-time job. College saving plans are geared towards planning and saving for your child’s future tuition rather than your own. Each financial plan prioritizes retirement funds. If you are a college student with a part-time job looking to get ahead in the financial planning game, or you are retired but still looking for a place to manage your finances, WeVest is not that place.

WeVest also requires a separate account for each individual item. For example, you need a separate account for student loans, a separate account for your retirement fund, a separate account for your savings, etc. Having this many accounts seems impractical, and having to input this many different accounts gets confusing on the website.

Is WeVest Worth It?

WeVest is perfect for the right people. If you are looking to keep track of your retirement fund, flesh out your savings, or invest in a home, WeVest has exactly what you need. If not, you may be better off looking elsewhere. WeVest is an incredibly thorough financial planning app that is truly a bargain for all it offers. If you want to invest in your financial future through financial planning, look no further than WeVest.

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Photos: WeVest

The Best $50 Grocery List

May 31, 2017 By James Hendrickson Leave a Comment

For many people the grocery bill is the easiest thing to control in their budget. You can always alter your grocery list from week-to-week based on your financial situation and the needs of your home/kitchen. What is the perfect grocery budget though? How do you find a good balance so that you don’t spend $100 on groceries one week and only have $25 the next?

Coming up with a generic grocery list is a great way to stick to a budget (especially on the really tight weeks). That is what sparked the idea for the $50 grocery list. Most weeks, $50 is a good number to shoot for as far as budget goes (especially for families of three or less). Below you’ll find what is possibly the best $50 grocery list out there.

$50 Grocery List

1 box of cereal or oatmeal ($2)
1/2 gallon of milk ($2)
Dozen eggs ($1)
Butter/Margarine ($1)
1 loaf of bread ($1)
1 jar of jelly ($2)
1 jar of peanut butter ($2)
Fruit ($3.50)
- Bananas and apples are usually cheapest but you can find good deals different times of the years.
Vegetables ($7)
- Like the fruits, you can mix this up based on your preferences and needs.
- Don’t forget frozen veggies make great sides and are oftentimes much cheaper than fresh veggies.
Yogurt ($3)
Canned soup ($2)
Canned tomatoes ($1)
Marinara sauce ($2)
Canned beans ($1)
1 pound of meat ($3)
Pasta ($1)
Rice ($2)

The above list will allow for cereal/oatmeal or eggs for breakfast. You can also choose to have fruit and yogurt if you’d like. Lunchtime will call for PB&J sandwiches. You can snack on some veggies, fruit or yogurt with your lunch as well. For dinner you can end the day with soup, spaghetti or meat-based dish with rice.

You may have noticed that the above list only adds up to $36.50 (about $40 with tax). This leaves room for $10 of wiggle room week-to-week. So if you want to buy more veggies one week or more meat, you can. You can also eliminate items if you don’t need them. For instance, if you only used half a box of pasta you won’t need to purchase another this week.

So, how do you go about making one of these $50 grocery lists for yourself?

How to Create Your Own Generic Grocery List

Keep in mind that most generic grocery lists like the one above are not adhering to any food allergies or diet restrictions (gluten allergies, diabetes, etc). Each person’s $50 grocery list will look different, however, it is a good place to start.

If you want to create your own $50 grocery list from scratch you’ll want to gather a few things. First, take a look in your kitchen and decide what your go-to meals and kitchen staples (things you HAVE to have) are. You’ll want to make a running list of thing like flour, sugar, etc that need replaced sparingly so you can add them to your list when you need to purchase them.

Then you’ll want to break meals and grocery list items down by meals (breakfast, lunch, dinner and snacks). Make sure that you cover all the food groups and that you’ll have enough for each meal throughout the week.

While a $50 grocery list may not be very glamorous, sticking to a budget can lead to a stable financial life (something we should all strive for). Will you try this $50 grocery list or create your own? If so, we’d love to hear from you!

Photo: Smithsonian Mag

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10 Ways Traveling Can Help Your Finances

July 15, 2015 By Will Lipovsky 2 Comments

While traveling can be fun, it also tends to be expensive. Whether you’re traveling for work, school, personal reasons, or vacation, you’re usually going to spend some money on your trip. However, you can learn some valuable financial lessons from the money you spend while traveling.

Learning How to Budget

Many forms of traveling require you to budget your money. If you’re going on vacation, you might only have a certain amount of cash you can spend. This becomes especially true if you’re in a foreign country where exchange rates are high and banks are scarce. If you’re traveling for work, you may only be allowed to spend so much on the company’s dime. Budgeting while you’re traveling can come in handy when you go to work on your own personal finance budget.

Forcing Yourself to Save Money

Traveling may also require you to save money. You might want to save up for a great vacation or you may have to save for a plane ticket across the country to go home after a semester at school. If you force yourself to save money in order to travel, why not force yourself to save money when it comes to your regular finances? Let travel be the start of something greater.

Improving Your Research Skills

Most people spend hours researching each trip they want to take. They’ll research the best flights or the best hotels to book or even the cheapest attractions or restaurants to visit. When you’re trying to plan a vacation on a budget, you do anything you can to find the best deals. However, you should also use these research skills when it comes to your everyday finances. Why not research cheaper grocery options or different internet providers who may have a cheaper plan? Research everything.

Appreciating What You Have

Travel may also help you appreciate what you have. There’s nothing quite like visiting another town, city, state, or country to make you reevaluate your own situation. You may think you’re in a horrible financial situation, but not every has the luxury and privilege of traveling (even on a tight budget).

Help Prevent You From Overspending

When you’re traveling, whether it’s for work or pleasure, it’s easy to overspend. After all, what’s one airport meal here or a couple coffees there? It doesn’t seem like it will add up until you reach the last few days of your trip and realize you’ve spent twice what you would normally spend in a week. And while vacation is a time to indulge, you don’t want to go too crazy. Being able to evaluate your purchases or seek cheaper options is a good financial trait to have and it’s one that will serve you well both while you’re traveling and when you’re assessing your normal finances.

Reevaluating Your Spending Habits

Traveling is also a great way to reevaluate your spending habits. For instance, you might want to consider buying cheap groceries such as cereal and bread once you arrive at the hotel instead of buying breakfast every morning. Or you might want to save your money for a tour instead of buying a souvenir you’ll throw out after a year. Thinking twice before you spend your hard earned money is smart on vacation, but it’s also something you should be doing in every aspect of your life.

Finding Cheaper Alternatives

There are almost always cheaper alternatives when you travel. Staying in a four star luxury resort is great, but you can also stay in a hostel or two or three star hotel for a fraction of the cost. You might want to save $50 by taking a flight early in the morning instead of in the afternoon. If you’re going to a lot of effort to find cheap alternatives for your traveling budget, it might be a good idea to do the same when it comes to your regular purchases.

Paying For Things Strategically

Most people go on vacations or trips with a set amount of money to spend. When you do this, you need to learn how to pay for things strategically. For instance, you might want to buy tickets to an attraction and then buy souvenirs with any left over money. When it comes to your regular finances – especially if you’re on a tight budget – you’ll also need to learn how to pay for things strategically.

Spending Money Wisely

Traveling is all about spending money wisely. You don’t want to go somewhere and pay twice the amount for an item because someone said it was a “good deal”. You also don’t want to spend all your money on the first day and leave nothing for the rest of the trip. When it comes to financial spending, it’s important to make smart decisions and not rash decisions.

Learning to Haggle

While you might not be able to get away with haggling everywhere you go, this can be an important part of traveling. A lot of countries allow haggling and it’s a good experience as it gives you an awareness of the true value of an item. Haggling over your normal finances might not be quite the same thing, but it may end up helping you out when you need to discuss extra charges on a utility bill statement or want to get a better discount on a slightly damaged item.

The Frugal Benefits of a Regular Schedule

May 23, 2012 By Jennifer Derrick 3 Comments

When I was in college and, later, working my first jobs, I never had a regular schedule. The jobs I had back then were either temporary or service oriented. Sometimes I’d work nights, sometimes days, and sometimes both. I worked holidays, weekends, and other times when no one else could or would work. It wasn’t until later that I was able to get a 9 to 5 job. When I did, I immediately discovered the frugal benefits of having a regular schedule.

When I was working all hours of the day and night, it was difficult, if not impossible, to plan things like meals or shopping trips. Since I never knew more than a few days in advance what my schedule would be (and, with temp work, where I would be), I found it hard knowing what I was going to make for lunch or dinner. I didn’t know which of those meals I’d be eating at home and which I’d have to pack in a lunchbox. Sometimes I didn’t know if I’d even have a lunch break or access to facilities like a microwave or refrigerator. As far as shopping, most of it was done on the run, without benefit of a shopping list, coupons, or careful comparisons.

When it came to cooking, I was often too tired to bother and I wasn’t able to make too many meals ahead of time, since I never knew when I’d be home to eat them. Sometimes I’d get in the middle of cooking or doing some other frugal activity and the phone would ring with my boss or agency asking if I could come in right now. Since I needed the money, the answer was almost always to drop whatever I was doing and go to work. After a while, I just gave up trying to pursue any time intensive/sensitive tasks like cooking meals in advance, planning elaborate shopping trips all over town to get the best deals, or making DIY projects instead of store-buying.

I couldn’t even do things like gardening or many outdoor projects at all since I never knew if I’d be home before it got dark or if I’d be sleeping through the day and working at night. I tried growing some container plants, but then I landed a job that required a lot of travel and, without proper care, they all died.

I remember those years as a blur of work, take out meals, missed appointments, and trying to sleep at all hours. When I finally settled into a regular schedule everything became much easier. I had whole weekends now to make meals ahead and carry out shopping trips so I could get the best deals. I always knew that in summer I’d be home in time to go out in the garden or mow the grass. I could actually make and keep appointments instead of flaking out at the last minute and incurring cancellation charges. Just getting regular sleep helped a lot.

Frugality is much easier when you have a regular schedule that you can plan around. When you know when meals need to be on the table (and which meals those will be), meal planning is easier. Cooking ahead is easier when you have blocks of uninterrupted time. When you know that you will always have a microwave or fridge at work, it’s easier to know what you can make for lunches. You can save more money when you can take your time in the stores and you have tie to clip coupons and plan your purchases. When you have blocks of time, you can plan and do other things like DIY and home repair projects yourself without hiring them out.

If you want to be more frugal, I would advise that you try your hardest to find work that gets you on a regular schedule. Frugality hinges on the ability to plan things like meals and shopping trips, to take care of things before they become huge problems, and to take advantage of limited time offers like sales. All of this is much easier when you have a predictable schedule.

(Photo courtesy of Sadie Hernandez)

10 Things The Army Taught Me About Finances

December 14, 2011 By Guest Writer 4 Comments

By Steve Repak, CFP®

In basic training, a soldier goes through a process of mental and emotional retraining so that they can operate in an environment very different from the civilian world. I figured out I could take some of the same lessons I learned in the Army and apply them to my finances. Once I started to think differently and then began doing different things with my money, I was able to start accomplishing my financial goals.

The following are 10 Things the Army Taught Me about Finances that I want to share with you in order for you to start thinking differently about your money and to show you that you possess the same skills and tools that I have to achieve any of your financial goals

Leadership

Unless you are a new recruit, you have served in some type of leadership role. Leadership is all about taking charge of the situation and not making excuses. Use that same type of thinking. I had to quit making excuses that I didn’t have any money and start taking charge of my finances.

Integrity

Your integrity plays a major part when you are serving in the military. Integrity requires you to be candid and honest. I left the Army with a lot of credit card debt. I had to be honest with myself and admit I had a spending problem. Use your integrity to be honest with yourself and identify the areas of your finances where you are weak. Once you identify those areas, do something about it.

Prioritizing

We had many things going on at the same time when I was serving in the Army and it was important to make sure we got the things done that we were supposed to. You can identify your current priorities by measuring two factors: What are you spending your money on and where are you spending your time. I changed my money priorities by spending at least thirty minutes a week on my finances.

KISS (Keep It Simple Stupid)

We learned not to over-complicate things in the Army. The same goes for personal finances. It doesn’t get any simpler than “if you are spending more money than you are making, you need to start spending less.” One I started spending less I started having more money at the end of the month.

Accountability

When I was a Platoon Sergeant, I had to know where my soldiers were at all times. When dealing with my finances I knew if I wanted to be a good leader with my money I needed to know exactly where I was spending my money. I did that by keeping a spending journal. For 30 days I asked for receipts every time I spent money. Once I got home I wrote it down in my journal.

Sacrifice

Everyone knows what sacrifice means in the Army. I can’t count how many holidays, birthdays, anniversaries, etc. I missed because of a deployment or assignment. To be able to start spending less, you have to make sacrifices. It might be not going to the vending machine everyday or reducing the temperature on the thermostat during the winter time. In my case, I had to quit spending money on video games and going out to eat all of the time.

Planning

You are always doing some type of planning in the military. For example, when we went on field maneuvers we had to move our equipment to different locations each night. I would have to identify where we were, where we needed to go, and how we were going to get there. I used the same steps for my finances. I had to determine where I was (my income versus my spending), where I wanted to go (how much extra I wanted to have in savings at the end of the month), and how I was going to get there (the areas I spent my money on that I could either reduce or eliminate).

Flexibility

I had to be extremely flexible when I was serving because either the mission or objectives seemed to change often. I had to be flexible with my money goals. At times emergencies would happen and get me a little off track. Once I dealt with it, I got right back on track.

Team work

“Together Everyone Achieves More” was one of our mottos. I had to count on others and work with others in order to get the job done. There are times when you need to ask for help. I had an accountability partner to help keep my financial goals. If you need help, there are many people out there that can help. If you are in the Army, you can go to the ACS (Army Community Services). For those not in the military, you can find yourself a CFP® Certified Financial Planner™ professional to help you with your financial objectives.

Determination or the “War Fighting Spirit”

As a soldier in the Army, I was determined to accomplish the mission. I had to possess that same type of determination with my finances. I had a lot of debt when I left the military. There were many times where things got difficult and I questioned if I would ever be able to get out of debt. I want to tell you that I stuck with my plan, and it wasn’t easy, but I did finally get out of debt. I want to tell you something else. If I was able to do it, I have no doubt that you can reach any of your financial goals too.

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Steve Repak is a certified financial planner and author of Dollars & Uncommon Sense: Basic Training For Your Money. He was honorably discharged from the Army in 1998 after 12 years of service. He was an instructor at the Advanced Noncommissioned Officers Course. In 1995 he was the Fort Bliss Noncommissioned Officer of the Year. He is a motivational speaker, consultant and principal at Repak Financial Services. He lives in Charlotte, North Carolina with his wife and three children.