All Shook Up!

I have been thinking about snow globes.  Sometimes they just sit there so pretty on the shelf and then someone comes by and shakes them and the snow falls softly until it settles again.  Other times someone comes by and really, really shakes them up.  You wonder how the little figurines inside don’t fall out of place.  At times my home finances feel like a snow globe – sometimes calm and settled and then sometimes something happens and it feels like our finances have been shaken up again.  The vehicle breaks down, someone needs surgery, there is a job change … it often doesn’t take much for serenity to be turned upside down!  

If you’d like to take control of your finances, MSU Extension has great resources in our Solid Finances series.  The Solid Finances program was started in 2013 and includes weekly financial webinars.  This year’s series includes topics such as health care insurance options for those nearing retirement, avoiding financial scams, Banking 101, and estate planning and family legacies.  Each webinar can be joined live on Wednesdays at noon.  This year’s webinars started on October 5, but the great news is that all webinars are recorded.  In fact, you can listen to any of the 50 webinars that are posted on the MSU Extension Solid Finances webpage.  Some of the recorded webinars include topics such as understanding credit scores, teens and money and how to reduce debt.  

There are topics for every stage of life. If your financial world is pretty settled, like a snow globe on shelf, it doesn’t hurt to dust it off every once in a while and take a look at it to be sure.  If your financial world is a little shaky, it might just do to take advantage of the free resources to establish Solid Finances.  

How Solid Are Your Finances?

Solid Finances:  2016-2017 Series Please join the Solid Finances webinar series this year.  We have made a few changes to improve the series. This year North Dakota State University Extension Service joins South Dakota State University Extension, University of Idaho Extension and Montana State University Extension in sponsoring the series. This new multi-state format will bring new expertise to the series to better serve you. The 2016-2017 Solid Finances schedule will consist of 18 sessions, with the first session on October 5th.  The first 14 sessions will focus on issues important to residents of all states. The final four sessions will focus on issues specific to participants from Montana and Idaho.  Solid Finances will feature 7 different presenters sharing their expertise and answering your questions. Lyle Hansen (UI Extension) will open the series on October 5th by addressing Credit Scores. Joel Schumacher (MSU Extension) will lead the next two sessions on Car Loans and Creating a Debt Repayment Plan.  Luke Erickson (UI Extension) and Carrie Johnson (NDSU Extension) will address Kids and Money in November.  Health and Finances will be the focus of three sessions in late November and early December. Retirement and Financial Awareness will be the focus of sessions in January and February.  For a complete schedule please visit:www.msuextension.org/solidfinances/schedule.html If you would like to participate in the 2016-2017 series, you will need to register: If you are using the same email address with which you registered last year; please register here   If you are registering with a different email address; please register here There is no cost to participate in the Solid Finances program, howeverregistration is required. We record all of the sessions in the webinar series.  Recordings of past sessions are available for viewing at: www.msuextension.org/solidfinances/pastrecordings.html. Here are few participants’ comments about last year’s program: The presenters were very knowledgeable on the topic and quick to answer questions typed it during the webinar. I know what I am supposed to do but actually doing it….well that is where the webinars help keep me inline and on track to follow through. Really appreciate the course instructors' wealth of knowledge & experience on the subject matter being presented. I love the resources that are shared each session. The webinars got me motivated to quit procrastinating. I hope you will participate in this year’s Solid Finances series. Please contact me if you have any questions about Solid Finances. Joel Schumacher 406-994-6637 This program is made possible by a grant from the FINRA Investor Education Foundation.

Solid Finances

When I was growing up, my mom used to say, “It’s just as easy to love a rich man as a poor one.”   I don’t really know whether or not that is true.   While it may be just as easy to love a rich man, in the dating years of my life it wasn’t just as easy to find one.  My husband was told growing up that you can “Marry more money in twenty minutes than you can make in a lifetime.” Apparently there wasn’t a line of wealthy women waiting to date him. Rest assured, we both married for love. 

I suppose those oft repeated quotes are well-meaning.  Parents advising their children often equate wealth with security.  As well, money is one of the top reasons for discord in a marriage.  Any time a resource is limited, it can be a source of conflict.  Rather than marrying money, it might be better if we advised young people how to equip themselves with the skills to earn and manage their own money.

I’ve read that if you want to improve your skills in any area, you have to study or practice daily.  A financial advisor coached that you should read, learn or do something about money each day. I’ve heard it said, “Where your attention goes, your energy flows.”  If you are interested in improving your skills in the area of finances, MSU Extension and Extension partners in South Dakota and Idaho have devised a way for you to learn about finances from the comfort of your computer.

The Solid Finances series, taught by webinar, starts October 7.  The series covers Managing Your Money with topics on plugging spending leaks, emergency savings, home buying and organizing records; Retirement Planning with the top ten need-to-know items, getting started late, and a retirement question and answer session;  Investor Protection and Student Loans with topics from predatory lenders, identity theft, applying for federal student aid and student loan consolidation; and Montana-specific classes including estate planning and your rights over your remains.   You can listen and interact with these sessions live or listen to recorded sessions.

The Solid Finances webinar information can be found at www.msuextension.org/solidfinances. The website contains information on how to register for the free classes.  Be sure to check out past recordings and resources from previous years of Solid Finances classes as another free resource to become educated about money. 

There could be better advice given than to marry for money.  We could start using this adage instead, “Make your own money and manage it well.”  Besides, I’ve heard that people who marry for money earn every penny!

And now a few words from the Christmas Witch ...

Around this time last year, a misguided and belated witch, presumably from Halloween, arrived to take over my psyche during the Christmas holiday season.  My family will recall that it nearly took an exorcism to remove her from my body.  I was very frustrated last year with the tasks related to the holiday season.  The tasks that annoyed me the most, and with Grinch-like stealth stole my pleasure, were related to gift-giving.  I know, “it is better to give than receive” and all that, but I was in no mood for either giving or receiving -- at least not tangible, store-bought items.  I was actually so uncharacteristically miserable about it last year that I vowed to reassign the gift detail to my husband this year.  We have a month to go to see how that works!

Maybe you also find yourself overwhelmed during the holidays.  There are a variety of tips that people can use to bring a better proportion to their holiday season, but for now, since my Scrooge-like focus is on gift giving, I’ll offer a few tips in that department.  One of my favorite ideas is to eliminate gift-giving entirely, when possible.  All those $5-10 gifts for the various groups your family belongs to, from work to clubs, really add up.  Not only in the monetary budget, but in the energy budget.  All the time spent shopping and deciding and wrapping only clutter your holidays.  And, really, when was the last time you got or gave a $10 gift that it was truly a needed item.  Most people can and will buy what they want for themselves in that price range.  My “gift” to many people in my world is that I will neither provide nor expect gifts from them.  Talk to your colleagues or your civic clubs and youth organizations and take a load off everyone and eliminate the gift exchange.

Another idea to reduce financial strain during the gift-giving hubbub is to start with the end in mind.  At the end of your purchases, you don’t want the residual gift to be perma-debt. Far too many households carry an extraordinary amount of credit card debt. People often get carried away, either with the impulse purchases during the holiday season or with the pressure to give really good (read expensive) gifts.  Jean Chatzky, author and financial editor for NBC's Today Show, recommends a budget of 1.5% of your household’s after-tax income be spent on holiday gifting.  According to the US Department of Labor, the mean wage in Montana is $39,000.  After subtracting 25%, as a general estimate for taxes, that leaves $29,250 multiplied by 1.5%, leaves $438 for a gift budget.  Based on this example, our average Joe Montanan, would write down everyone on his gift-giving list and figure out how to divide up his gift budget among those recipients.  According to Chatzky, 1.5% is the amount most Americans can pay off by February, if they charge holiday purchases.  Well, now, thanks to the math, I realize why I was so grumpy last year.  The price on the expected and advertised gifts well exceeded my 1.5% budget!

A friend offered another suggestion to reduce the stress of holiday shopping.  She only gives what she can buy locally.  Think about how much time is saved, and how much more pleasant the experience, when shopping where you live.  Perhaps the choices will be more limited than the gazillion options of online shopping, but it can be the gift that keeps giving – circulating money in the local economy.  Plus, it can be a great tool for those of us who suffer from TMC (Too Many Choices) syndrome. 

Another tip is to give only gifts you already own. Some of the most memorable and nicest gifts I’ve ever received were used and it actually was the “thought” that counted.  Among my favorite gifting ideas is to give services, such as oil changes, haircuts, house cleaning or to share your own talents by volunteering to mend or cook, or do odd jobs for which you are skilled.  I also like the idea of giving experiences, not things, which reduces clutter.  A great example I heard recently was when grandchildren, who never know what to get their grandmother anyway, decided to pay for her to participate in strength-training classes at her assisted-living facility.  One of my favorite gifts I received last year was from my mother, who bought tickets for our family and our neighbors to enjoy a Phil Aaberg concert in Chester.  It was the highlight of my otherwise self-induced surly season last year. 

 

This year, Phil Aaberg will be in Choteau on December 11 giving his talents to help the group.  This group gives support to people in our community who are developing their own talents, but may not be able to afford parts of their training.  These

are the gifts that keep on giving.
Opportunities for All

This year, I hope to take my witch’s broom and sweep away at least a few of the strains of the season.  Maybe some of the ideas will work for you to be holly and jolly, too.  

_________________________________________________________________

Jean Chatzky Holiday Spending

MSU Tips on Jolly

Holiday Stress

Better Late Than Never

I’m running a little late, which my friends and family will tell you isn’t that unusual.  I don’t try to be late.  I just always think I can get one more thing done.  My most famously late time was probably when I arrived to a wedding an hour after it was scheduled to start.  The problem was, the wedding was mine.  So, what can you expect from someone who was an hour late to her own wedding?  You can expect that I’m not going to be on time for everything.  What I’m late for now is America Saves Week, which is February 24-March 1.  But, better late than never.  Which, if you think about it, is an adage that applies to saving money, too. 

Hopefully we have all heard about the time value of money. If you save when you are young, you’ll accrue more interest -- thereby having to save less overall, but ending up with more saved.  For example, Jack deposits $2000 into savings for 10 years between the ages of 25-34 and leaves it there, contributing nothing

more to his savings between ages of 35-65.  Jill, on the other hand, waits until age 35 and starts depositing $2000 per year for 31 years (ages 35-65).  Jack put a grand total of $20,000 away and Jill put $60,000 in savings.  In the end, due to the time value of money and compound interest, Jack has $545,344 at age 65 and Jill has $352,427.  By starting when he was younger, Jack is almost $200,000 wealthier.  But what if you no longer qualify as young?

What I’m afraid happens to people is they hear that they should have started saving before they were in their 30’s and, since they got a late start, feel hopeless.  But, guess what?  Jill still has $350,000 and change in savings.  Truly, better late than never.  Even though I’m not great at math or time, I know that $350,000 is a lot more than zero.  If you get a late start, so be it.  Just be sure you get started. 

One way to get started it to go to www.AmericaSaves.org and set a savings goal.  It doesn’t matter how big or small the goal is, just get started.  It also doesn’t matter if you do it after the big America Saves Week.  In the end, what matters is that you save some money.

Stephen Brobeck, Executive Director of the Consumer Federation of America and a founder of America Saves, noted: “Only about one-third of Americans are living within their means and think they are prepared for the long term financial future. One-third are living within their means but are often not prepared for this long term future. And one-third are struggling to live within their means.” If you are in the two-thirds of Americans who are not prepared for the financial future, now is the time to start preparing. 

One great financial tip is to automate savings.  Even if it is $40 per month, getting that habit automated can really make a difference.  If you have automatic deposit on your paycheck, set up a savings account and automate a portion to the savings.  Some people spend whatever they have, or can see in their checking account, so getting a portion automatically out to savings can be an important move.  If you get a tax refund, put that in your savings.  You might be surprised that the financial security you feel as you start to build savings will be more important to you than consumer purchases.  You can get used to living on less.

There are twenty-five other great strategies in the book, Small Steps to Health and Wealth by Rutgers Extension.  We have twelve copies of the first edition of the book available for free at the MSU Teton County Extension Office, because it is never too late to get your finances in order.

What if, all those years ago, I had decided because I was running a little late, I shouldn’t even bother?  With savings, and weddings, as it turns out, it’s great to be on time, but it is also better late than never! 

Resources for Saving:

Thanks to Barbara O'Neill, Ph.D., CFP, CRPC, AFC, CHC, CFEd, CFCS

Extension Specialist in Financial Resource Management, Distinguished Professor,Rutgers Cooperative Extension for the list of resources below.

Cooperative Extension Investment Resources

When it comes to investing, it always helps to have background information, financial calculators, and other planning tools. The Cooperative Extension System offers a wide array of online resources through its online eXtension portal and through various land-grant universities. Below is a list of publication titles and Web site addresses:

eXtension Personal Finance Web site: http://www.extension.org/personal_finance

eXtension Investing for Your Future 11-module home study course:

http://www.extension.org/pages/10984/investing-for-your-future#.UwN5fk2YaM8

eXtension Investing for Farm Families home study course:

http://www.extension.org/pages/23204/investing-for-farm-families#.UwN5sk2YaM8

eXtension Saving and Investing Web page:

http://www.extension.org/pages/8634/financial-security:-saving-and-investing#.UwOCFk2YaM8

eXtension Saving and Investing Research Briefs:

http://www.extension.org/pages/18217/saving-and-investing-research-briefs#.UwOCk02YaM8

Illinois- Plan Well, Retire Well Blog: http://web.extension.illinois.edu/cfiv/eb141/index.cfm

Indiana – Planning for a Secure Retirement (online 10-module retirement planning course with dozens of links): https://ag.purdue.edu/programs/areyouprepared/secureretirement/Pages/default.aspx

Iowa- Family Finances Web Site: http://www.extension.iastate.edu/humansciences/family-finances-families

Iowa- Invest Wisely (news articles and audio files): http://www.extension.iastate.edu/investwisely/

New Hampshire- Saving and Investing Web site: http://extension.unh.edu/Managing-Your-Money/Saving-and-Investing

New Jersey- Investing Basics (from Rutgers Cooperative Extension book Money Talk: A Financial Guide for Women): http://njaes.rutgers.edu/money/pdfs/session-iii.pdf

New Jersey- Investing for Retirement (from Rutgers Cooperative Extension book Money Talk: A Financial Guide for Women):

http://njaes.rutgers.edu/money/pdfs/session-iv.pdf

New Jersey- Investment Risk and Return Characteristics: http://njaes.rutgers.edu/money/investmentrisk.asp

New Jersey- Rutgers Cooperative Extension Asset Allocation Spreadsheet: http://njaes.rutgers.edu/money/

New Jersey- Rutgers Cooperative Extension Personal Finance Web Site: http://njaes.rutgers.edu/money/

New Jersey- Rutgers Cooperative Extension Financial Goal-Setting Worksheet: http://njaes.rutgers.edu/money/pdfs/goalsettingworksheet.pdf

New Jersey- Rutgers Cooperative Extension Financial Planning and Investing Glossary: http://njaes.rutgers.edu/money/glossary.asp

New Jersey- Rutgers Cooperative Extension Financial Fitness Quiz:

www.rce.rutgers.edu/money/ffquiz.asp

New Jersey- Rutgers Cooperative Extension Investment Risk Tolerance Quiz: http://njaes.rutgers.edu/money/identitytheft/

New Jersey- Rutgers Cooperative Extension Tax Information Web page: http://njaes.rutgers.edu/money/taxinfo/

Virginia- Building Your Financial Team: Financial Planners

www.ext.vt.edu/pubs/agecon/448-063/448-063.html