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  • Posts Tagged ‘saving’

    It’s Never Too Early to Talk to Children about Retirement

    Thursday, December 22nd, 2016

    Sonya Meets Her Future SelfRetirement is a concept that most adults don’t fully comprehend, let alone kids. 401(K)s, mutual funds, compounding interest, Social Security… all of the terms and jargon surrounding retirement saving can be confusing even to the most well-educated person. One of the best ways to make sure that children grow to understand the importance of retirement saving is to start planting the seeds of knowledge at a young age. The movement to educate children about financial literacy at school is gaining traction across the country, but it is still important to talk to children about the importance of long-term savings outside of the classroom too.

    A valuable tool for introducing the concept and value of long-term saving is WISER’s publication, Sonja Meets Her Future Self. The illustrated children’s book tells the story of a young girl named Sonja who travels through time and meets herself at different points in her life. The book was published in collaboration with the Wyoming Retirement System. You can download the book here to share with the children in your life. You can also watch a narrated video of the story. After you finish, here are some lessons you can discuss together:

    1. Make Sure To Always Save Part Of What You Make

    In the story, Sonja’s grandpa takes her to the bank to open an account, and every week after that, they go to the bank together to deposit part of her allowance. This is a great reminder to kids that even if they are making a small amount of money each week, it is worthwhile to put some aside. Once they get older and their paycheck grows, their weekly savings will as well. Although many transactions are done online, the weekly act of visiting the bank the way Sonja and her grandpa did can be a much more lasting reminder to always put something aside.

    2. When You Do Buy Something, Choose Something With Lasting Value

    Following her grandpa’s advice, Sonja begins saving a little bit of money every week. But he also makes sure to let her know that “it’s OK to spend money.” When you do, it should be for something really worthwhile. In Sonja’s case, she saved enough of her allowance each week to eventually be able to buy her first skateboard. She rides the skateboard all the time, and it even allows her to travel into the future—a purchase well worthwhile! When she is 18, Sonja tells her younger self that she used the money she has been putting away each week from her part-time job to buy herself a used car—another smart, worthwhile purchase. Sonja didn’t buy things she used once and then got bored with, she bought items with real value that she made long-term use out of. Her spending options are a great lesson that spending money is not bad, as long as you are smart about it.

    3. If You Save A Little Bit Over A Long Time, Eventually You Will Have A Lot

    Sonja started saving every week at the age of 11. At first, she only saved up enough to buy a skateboard, but eventually she had enough to buy a used car, and eventually enough to live off of in retirement. Her saving story is a great lesson that even if you only save a little bit, over a long time, it will grow.

    During this gift-giving season, share the story of Sonja with a child in your life.  It is a gift that can last a lifetime!

    Celebrating Women’s Contributions to Finance

    Monday, March 7th, 2016

    March is Women’s History Month! WISER is commemorating the occasion by reflecting on the role women have played, currently play, and will play in the world of savings and investment.

    Today, women fill the ranks of the banks and other financial companies that manage our investment portfolios and savings—the things that make retirement possible. They work on the floor of the stock exchange, they are certified financial planners—they’re present at just about every level of the money machine that allows the money you save to grow and help you reach your long-term financial goals. Just like in any industry, that diversity makes the financial industry more resilient, creative and forward thinking.

    Of course, there’s still room for improvement. Women are still underrepresented in leadership positions and all of the top banks are currently run by men. Yet women have made incredible progress, and during Women’s History Month, it is worth reflecting back on how very far we have come.

    Despite the fact that they were unwelcome by most during their time, a number of women were able to break into the world of finance. Here are three of those trailblazers, and the lessons they can teach us today:

    Abigail Adams

    Abigail Adams

    Abigail Adams. Photo: Wikimedia Commons

    Abigail Adams is most often remembered as the wife to her husband, John Adams, who was the first vice president of the United States and the second president, and the mother of John Quincy Adams, the sixth president of the U.S. The loving marriage between Abigail and John- a match of two intellectuals- is well documented by the many letters the two sent back and forth. However, there was one topic that caused contention between the two of them (something that might sound familiar to anyone who is married)—money. While John was away on state business, he put Abigail in charge of the family’s money affairs. He instructed her to invest exclusively in land, but she realized that U.S. government bonds would be a better return on investment. Although the couple’s money was legally his under the laws of the time, she was able to put some aside and invest with the help of an uncle, who acted as a trustee. Her personal investments quickly began to accrue more interest than her husband’s suggested ones.

    Abigail is a role model for anyone who feels like their voice isn’t being heard when it comes to managing the family’s financial decisions. Although her husband was insistent about investing in land, her idea of investing in government bonds ended up being the better idea. She teaches us that putting all of your faith in your partner to make the right financial decisions is not always a smart idea. Do your research, get involved and make financial choices as a couple.

    Hetty Green

    Hetty Green. Photo: WIkimedia Commons

    Hetty Green. Photo: Wikimedia Commons

    Hetty Green was born in 1834 to a wealthy family. By the age of six, Hetty was reading financial papers to her father aloud, and by age 13, she was the family bookkeeper. As she got older, Hetty’s interest in finances grew, and she is well-remembered for turning her moderate family fortune into a huge fortune that made her the richest women alive at the time. At its height, her net worth was estimated between $100 and $200 million- the equivalent of $2 to $4 billion today. Gossips at the time referred to her as the “Witch of Wall Street” and the Guinness Book of World Records even named her the “World’s Greatest Miser” for her extreme penchant towards saving;one rumor says she spent half an evening searching her carriage for a lost two-cent stamp. However, as one obituary of her pointed out, the characteristics that many criticized her for would have been considered commonplace in a man.

    Hetty’s attitude towards investing and saving that she credits with helping her amass her huge fortune is still valid today. She made a rule of investing conservatively and always having enough money in cash reserves to last through any market tumult.

    Muriel Siebert

    Muriel Siebert, better known as Mickey, is famous for being the first woman to own a seat on the New York Stock Exchange. In 1967, she founded her own brokerage firm, Muriel Siebert & Co. Inc., and that same, year, she sought to purchase a seat on the NYSE. Doing so requires sponsorship from two current seat holders, and the first nine men she asked turned her down. Eventually, she was able to land the seat, and in 1977, Mickey was appointed as the first female Superintendent of Banks for New York State. During her tenure, she oversaw assets of $500 billion, and not a single bank failed.

    When Mickey purchased a seat on the Stock Exchange in 1967, she was the only woman out of 1,365 men. It took another ten years for another woman to join her. Even if you feel like a fish out of water while navigating finances and retirement saving, persevere!


    Just like Abigail Adams, Hetty Green and Muriel Siebert, you can make your own financial history—and there’s no better time than Women’s History Month to do it. A great way to start is by visiting to learn more about saving, investing and retirement planning.

    Be Smart When Giving Money to Kids

    Thursday, February 25th, 2016

    A cracked egg with money flying out the window.


    New research suggests that younger generations are increasingly relying on their parents and grandparents financially, and while it might seem like instinct to open up your wallet to your children or grandchildren, doing so without paying attention to how it might affect your retirement can cause financial trouble down the road.

    A recent study by Ameriprise Financial of adults in the baby boomer generation (in other words, those who are likely to have recently retired or are about to) found that a large majority (93%) provided financial support to their children.  This could include things like helping them pay for college (71%) or helping them buy a car (53%), but many also admit to helping fund unnecessary luxuries.

    While it may feel selfish to not share your money with your kids and grandkids, keep in mind the many years you worked to save for your retirement. It is important to be smart and cautious about how much you give, so that your generosity doesn’t affect your ability to live the lifestyle you need to be happy and healthy during retirement.

    Be Selective About How You Give

    There’s a big difference between dipping into your retirement savings to pay your son or daughter’s medical bills versus funding their move to a fancier new apartment.  Ask yourself if the money will go towards something they really need and if will help them be financially independent in the future. If the answer to both of those questions is no, it is probably best to not provide a monetary handout. The fact that your grandchild wants the coolest new video game isn’t enough—a new version will be out in a year.

    If you determine that the need is big enough to dip into your retirement savings, make sure that the gift will not push you above your safe withdrawal rate—defined by Kiplinger’s as “the annual spending amount that gives your portfolio good odds of lasting a lifetime”. Think about what you’re willing to give up in order to write that check. When something is framed not as what you are giving, but rather as what you are giving up, it is less likely that it will seem worth it.

    It is also a good idea to make direct payments whenever possible. Rather than writing a check that is meant to be used for school, pay the school directly. Making direct payments prevents the possibility that your child or grandchild will misuse the funds. Furthermore, if you pay medical or tuition bills directly, the money is not considered a taxable gift by the IRS.

    If you decide to offer your child a loan, create a promissory note, set a strict repayment schedule, and charge an interest rate. If you do not do these things, the IRS might consider the loan a gift, and determine that it has to be taxed as such.

    Find Ways to Help Beyond the Checkbook

    If you take an honest look at your finances and decide that you can’t give monetarily, think about how else you can help. There are many alternatives beyond writing a check. If your kid or grandkid is having trouble paying rent, offer to have them live at home (but still pay their share of the utilities). Offer to babysit while they work extra shifts at work, or help them in their job search. If managing money is an issue, help your kids or grandkids create a budget and find ways to adjust their spending.  This will not only help them in the short-term but you will also be helping them develop an important life skill.

    The internet is filled with stories of parents who gave too much money to their kids and ended up bankrupt, struggling or having to sell their home during retirement. An outcome like that is not beneficial to anyone, and a little monetary gift in the present isn’t worth the long-term hit it can cause to retirement security. All to say: be smart and careful about how you give.


    About Us

    WISER is a nonprofit organization that works to help women, educators and policymakers understand the important issues surrounding women's retirement income. WISER creates a variety of consumer publications including fact sheets, booklets and a quarterly newsletter that explain in easy-to-understand language the complex issues surrounding Social Security, divorce, pay equity, pensions, savings and investments, banking, home-ownership, long-term care and disability insurance.

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