MoneyTip$

Since June is considered the big month for weddings, I guess it’s not surprising that I attended a family wedding last weekend.  My bank account is grateful that I wasn’t in the position of paying for any part of the wedding; it was a lovely event, and I don’t really want to think about the total cost to the bride’s and groom’s families. 

Instead, my attention was drawn to the costs of being a wedding guest.  Most members of our family live several hours away, so many of us had two hotel nights, as well as gas and meals and gifts.  Some of my relatives had even a third hotel night, because they needed two days to travel to the event.  I am in no way grumbling about the cost.   It was a wonderful opportunity to really spend some time with family members, including aunts, uncles and cousins I don’t see  even once a year.  So it was absolutely worth the expense.

But I was struck by the recollection of certain past summers when I had many weddings to attend.  If I had, say, five weddings this summer that involved costs similar to this past weekend, then I would be feeling noticeable financial pain!

I often remind people to plan for periodic or occasional expenses, such as back-to-school, 6-month insurance premiums, and holidays.  Never once have I included “wedding season” as one of the costs to plan for, but perhaps I should!  Planning ahead involves anticipating and setting aside funds for a wide range of future needs (and wants) — including expenses that don’t show up on typical lists!

~Barb

Saving, Spending plans wedding

When I filled my car’s gas tank recently the price of fuel was $3.69 and the total was  $55.35. Yikes!  I remember a time (long ago) when I could get the same amount of gas for only $4.05.  (Now, just the fuel taxes are more than that!!)

 The increase over time is attributed to high world-wide demand for a limited resource. So the logical thing to do is to reduce demand, right?  Want to Save Gasoline Costs?  gives good tips for cutting down our fuel usage.  But it’s easy to get discouraged, because I know that driving at 55 miles an hour, avoiding jack rabbit starts, planning dovetail trips, and all those other steps will never get me back to $.27 @ gallon.  SO – should I just give up? 

Sometimes in teaching I ask folks what they would do if I issued them a check for $500.  It isn’t hard for them to generate an answer!  I follow that up by asking what they would do if I handed them a nickel ($.05). A yawn usually comes from the back of the room.  But here’s the thing: I point out that one nickel added to another over time will soon result in 50 cents; and 50 cents a few times will yield $5; and sooner than we think, we might actually have $100 or $500. Little things do add up.

It’s the same with fuel usage.  Supply and demand is still alive and well in the world of economics. Small changes in consumption by a large number of consumers will bring a dip in demand the fuel industry will notice. It does pay off eventually. I don’t think prices will go back down to the levels of my youth, but perhaps they’ll go down a little – or at least increase more slowly.

Sure, we like the “instant wins,” where big payoffs happen in a hurry. Collecting a nickel at a time isn’t as much fun, but still worth our attention.

- Joyce

Saving

While shopping for a book online I discovered it was available for a “kindle” and that I could download a free Kindle application to my laptop, computer, and/or tablet to read electronic books. The title I was seeking wasn’t available in other media formats, so I tried it out and was thrilled that it was instantly available. I’m now adjusting to reading on an electronic device and trying to avoid some annoyances with electronic page turning, etc.

That led me to explore what our local library offers for electronic books and audio files.  WILBOR is the most common service available in Iowa. My librarian reports that the license agreement has some restrictions – you must have a library card and live within a geographic area. Here is the link to a list of Libraries in Iowa that participate: http://wilbor.lib.overdrive.com/ADF7D3C7-B01C-4B88-872B-20CAECC9A252/10/50/en/libraries.htm. I recommend checking with your librarian to clarify if you are eligible to use the service. 

You might also want to ask about electronic access to periodicals and other reading content, in addition to checking out their movies, book clubs, and summer reading programs as shared in a previous post about free or low cost summer activities.    Joyce

Saving, Smart shopping

I remember how difficult it was, as a parent, to remember to give out allowances: get cash, remembering when it was owed and figuring out how to encourage savings.

A quick search on Google confirmed that I am not the only person who struggled with this dilemma.  There are now many kid-friendly web sites that track chores, allowances, saving and spending…Count My Beanz, My Job Chart, Tykoon, ThreeJars and FamZoo are just a few.  What I found most interesting about these sites is…they all promote 3 things – SAVE, SPEND and SHARE.

When I was a child, I remember sitting in church and just before the collection plate was to be passed, mom would hand me a dollar to drop in the plate.  I thought it was fun to put the money in and see how much was in the plate, but I never connected that ritual as an act of charity on my part.

As I reviewed these webpages designed to teach kids about money management, I was intrigued by the SHARE component. I would consider myself generous in giving of my time and talent but I don’t think that was instilled in me by my experience as a child sitting in church, putting mom’s money in the plate.

These websites are very similar in how they track the child’s financial activities. They vary most in how the child actually gets their hands on the money and how the child can SHARE their wealth. Giving to others will help a child to be aware of his or her community and grow into a responsible, ethical and tolerant adult. How have you taught the children in your life about charity?  ~Brenda

Saving

A couple of months before each birthday, I would receive a Social Security statement in the mail. It provided estimates of benefits I would receive if I became disabled, or retired early…at full retirement age…or at the age of 70. It also provided a table with my yearly income which was always good to look over for errors.

Social Security stopped mailing these statements to individuals who had July 2011 birthdays, but anticipated resuming the mailings to workers when they reached 60.

Now, anyone age 18 and older can sign up for a my Social Security account to get a personalized online Social Security Statement – the same information that came on the statement in the mail.  In addition, the portal also includes links to information about other online services, such as applications for retirement, disability and Medicare.

Social Security beneficiaries and Supplemental Security Income (SSI) recipients can now access their benefit verification letter, payment history, and earnings record instantly using their online account.  The benefit verification letter serves as proof of income to secure loans, mortgages and other housing, and state or local benefits.  I also proves current Medicare health insurance coverage, retirement or disability status, and age.  People can print or save a customized letter.

This new online service allows people to conduct business with Social Security without having to visit an office or make a phone call. Beneficiaries also can change their address and start or change direct deposit information online. For more information, visit www.socialsecurity.gov/myaccount.  ~Brenda

Retirement

When you see the term resources – what comes to mind? Until you take account of what you have, you often overlook what is available to you.

Financial Resources include:

• Make a list of all your assets, or everything that you own.
• Look at financial assets – bank accounts, investments, retirement accounts and physical assets – home, car, or personal possessions.
• Which financial assets can be easily converted to cash?

Personal Resources include:

• Education, certifications, and designations – What are your talents? Are there opportunities to increase your skill and knowledge levels to make yourself more marketable?
• Time – Your schedule and the schedule of others in your family may create opportunities to help each other. Consider trading responsibilities or bartering skills.
• Talents and skills – Doing repairs, providing music lessons, or gardening can be used to earn money or trade services with others.

What resources does your household have?

• Family, friends, other people in your social network may be tapped to meet needs.
• Be sure to access resources in the workplace, online, and In the community
• Personal possessions that have outlived their usefulness to your family can be sold or exchanged.
• Don’t overlook the ability to use communication, cooperation, commitment and creativity to find solutions to life’s problems.

- Susan

Goals, Spending plans, Uncategorized Assets, Problem Solving, Skills, Talents

Getting motivated to save for retirement can be a challenge, especially when you’re young.  It’s much easier to prioritize immediate needs or wants than it is to stash money away for the distant future.  Yet it is the early saving we do that has the most impact.  Why?  Because that money has more time to grow.

Example:

• Saving just $1,000/year (at 8%) will yield well over $250,000 after 40 years.   You invest $40,000 over time and gain more than $210,000 in investment earnings.
• By contrast, if someone wanted to save $250,000, but waited till the last 15 years to start saving, they would need to save more than $9,200/year (earning an 8% return).    In this scenario you invest over $138,000 and gain less than $115,000  in investment earnings.

Which is more realistic?  Wouldn’t you rather scrape together $1,000 a year now  (that’s $83/month) instead of waiting till late in your career and then panicking about how to catch up?

There are lots of examples showing the benefit of starting early in saving for retirement.  Check out ISU Extension’s publication “Begin By Planning Today” for more ideas on this subject https://store.extension.iastate.edu/ItemDetail.aspx?ProductID=5390

If you haven’t been saving for retirement, now is the time to start!  If you have been saving, but want to save more, now is also a great time to boost your monthly savings. 

Here’s one idea for “finding” money to save:  Challenge yourself to MATCH every dollar you spend on “fun” this summer (going to the fair, buying ice cream, watching movies,…) with a dollar saved for retirement.  After all, if you can afford to spend money on something fun, then you can probably also afford to put money away for retirement necessities.

What are your ideas for finding money to save for retirement?  Remember, even small amounts can grow and provide big yields, especially if you start now!

~Barb

Retirement, Saving

Iowa’s Healthiest State Initiative now includes encouragement to take advantage of great low-cost outdoor fun!   It’s called “Healthy and Happy Outdoors” (H2O for short).  People who join H2O create an on-line account, and then simply record each time they take advantage of one of Iowa’s great parks or recreation areas.  Every activity recorded becomes an entry in a drawing for PRIZES!  The prizes, not surprisingly, are related to outdoor recreation – free outdoor activities worth hundreds of dollars!

If you participate in H2O, you may or may not win one of the official prizes.  But you are guaranteed the prize of enjoying your favorite outdoor activities in some of the most beautiful parts of our state — all at little or no cost!  That’s what I call a great return on investment – no cost, guaranteed return!  Even if you don’t care about the official “prizes,” check out the website  http://www.iowadnr.gov/Recreation/HealthyHappyOutdoors to learn more about the terrific outdoor opportunities available near you!

Personally, my plan is to get my bike tuned up (it has been sitting idle for a few years).  What’s your plan for enjoying Iowa’s outdoor treasures this summer?

~Barb

Saving, Smart shopping

With summertime upon us, first look around your community! There are many things that your family can take participate in.

Your local opportunities might include:

• Visit the park or local community festivals
• Go for hikes or bike rides
• Have a family picnic at the park.
• Go swimming at the local pool
• Take advantage of free programs offered at the local library, museums, community bands or other free community events.
• Check out books, music and videos for free from the library.

Fun entertainment can also be found at home:

• Have a family game night
• Rent or borrow movies, pop some popcorn and have a family movie night at home
• Bake or cook together as a family
• Read stories to one another
• Take an evening walk together

Show your children new skills and ideas:

• Have a family garden
• Teach a craft skill to your children and enjoy spending time doing these things
• Let your child learn about the environment, news, politics, helping others and be a part of the community opportunities

-Susan

Saving, Spending plans Local Resources

Dramatic changes in the health insurance market have occurred as a result of the Affordable Care Act (ACA). Change continues with the creation of the Health Benefit Exchange (referred to as “Exchanges”), open for enrollment October 1, 2013. Exchanges are a new mechanism for purchasing health insurance coverage. Think of the Exchange as a travel website, such as Travelocity, essentially a web portal created so you can shop and compare insurance plans. The Exchange is one stop shopping with “apples to apples” comparisons. Exchanges will create a more organized and competitive market and will primarily serve smaller employers in Iowa and Iowans who will be purchasing insurance on their own. 

Iowa is currently setting up its Exchange, and public input is wanted!  You can have a voice in creating and planning by participating in a consumer survey from the Iowa Department of Public Health, which is part of the interagency work group responsible for planning and implementing the Affordable Care Act in Iowa.  Developed with the University of Iowa Public Policy Center and College of Public Health, the intent of the survey is to gather consumer preferences for purchasing health insurance, receiving information, and desirable features and content on the Exchange.

 The information gathered will be valuable in designing the Exchange and targeting the education and outreach in Iowa. You can access the survey at http://iowahealthinsurancesurvey.com/. A factsheet that gives more detail on what the health benefit exchange is can be accessed here: http://marketplace.cms.gov/GetOfficialResources/Publications-and-articles/about-the-marketplace-english.pdf 

Suzanne Bartholomae, Ph.D.
ISU Extension State Specialist, Family Finance

Thanks to Suzanne for this guest post!  We encourage everyone to improve the process by taking the survey!

Insurance, Smart shopping