Making Cents Sense

When I walked across that stage on my college graduation day, I was filled with a mix of emotions - excitement, anticipation, and a dash of fear about what lay ahead in the "real world." Little did I know that the wisdom my dad would share with me that day would shape my financial future in ways I couldn't have imagined. Today, I'm sharing the incredible advice my dad gave me about what to do with every paycheck, and how it has helped me build a secure and prosperous life. The "50-30-20" Rule: My dad's financial advice was straightforward and easy to remember: the "50-30-20" rule. He told me that every time I received a paycheck, I should allocate 50% of it to essentials, 30% to personal wants and desires, and 20% to savings and investments. Essentials (50%): This category covers your basic needs like rent, groceries, utilities, and transportation. It ensures that you have a stable foundation to buil...

Hey there, fellow dreamers and future retirees! I don't know about you, but I've always had this magical number in my head when it comes to retirement: $1 million. It's the ultimate goal, right? To live out our golden years in comfort, traveling the world, spoiling our grandkids, or simply sipping margaritas on a beach somewhere. But the question is, how much do you need to save to retire with $1 million, especially if you're making a modest salary like $65,000 a year? Well, my friends, I've done the math, and I'm here to share it all with you. Step 1: Setting the Goal Before we dive into the numbers, let's talk about why $1 million is the target for many of us. It's not just a random number; it represents financial freedom. With a million bucks in the bank, you can comfortably maintain your lifestyle, cover medical expenses, and maybe even have some left over for those dream vacations. Step 2: Crunching the Numbers Okay, let's get down to bu...

There's a viral photo going around showing a stash of $480,000 in cash hidden under a mattress. And while that makes for an Instagram-worthy moment, it brings us to an important question: how much cash should you actually keep at home for emergencies? Before you empty your bank account and turn your mattress into a mini Fort Knox, let's unpack this topic. Why Keep Cash at Home? Power Outages: Natural disasters or blackouts can render ATMs useless. Banking Glitches: Systems can go offline, denying access to your funds for short periods. Immediate Needs: Sometimes, you need cash on hand for immediate or unexpected expenses. Risks of Keeping Cash at Home: Theft: No matter how secure you think your hiding spot is, thieves can be cunning. Natural Disasters: Fires, floods, or other events could destroy your cash. Devaluation: Money loses value over time due to inflation. So, How Much Should You Keep? Whil...

The pension puzzle, for many retirees or soon-to-be retirees, is like a financial game of chess. Each move and decision can significantly impact your retirement outlook. One of the most debated decisions is whether to opt for a lump sum or stick to a monthly pension. If you’re considering a $44,000 lump sum or a $423 monthly pension, this article will break down the factors you should consider. Let's decode this dilemma! 1. Mathematics of Money Let’s start with the basic math. If you opt for the monthly pension of $423, it would take you a little over 8.6 years (104 months) to receive $44,000. So, the critical question becomes, do you expect to live longer than those 8.6 years after retirement? If so, the monthly pension might offer a better financial return in the long run. 2. The Time Value of Money (TVM) Remember that $1 today is not the same as $1 a decade from now. Thanks to inflation, the purchasing power of money decreases over time. If you can invest the $44,000 lum...

An Investment in the Future: Financial Literacy for Every Student The future of our world depends on the financial acumen of the next generation. But, with recent studies showing that a majority of young adults struggle to manage personal finances, there's a pressing need to revolutionize financial education in schools. Enter Greenlight, the company that has been at the forefront of children's finance management with their innovative debit card for kids. This week, Greenlight announced the launch of its latest groundbreaking initiative: a free, interactive K-12 personal finance curriculum designed to uplift and empower students with the essential knowledge they need for real-world financial decision-making. Bridging the Financial Education Gap Traditionally, personal finance has been a neglected area in many school curriculums, leading to generations of students graduating with limited knowledge about managing money, investing, or understanding credit. Greenlight...

  It's easy to think that money is just about numbers, savings, and investments. But in "The Psychology of Money," Morgan Housel takes us on a deep dive into the behavioral aspects of money, reminding us that financial success isn't solely about what you know, but rather how you behave. Now, as we face the financial realities of a global pandemic, Housel's insights seem more relevant than ever. Let's explore. Money is Emotional The economic downturn induced by the pandemic has undoubtedly hit many of us hard. Yet, one of the crucial takeaways from Housel's book is that our relationship with money is deeply emotional. We're not always the rational, logical beings we think we are, especially in times of crisis. Understanding and recognizing our own financial biases can help us navigate tough times more effectively. Past ≠ Future One of the most striking points Housel drives home is that our personal experiences with money shape our financial outl...

  Hello to all our dear readers out there! With the New Year around the corner, many are eagerly waiting for the annual Cost of Living Adjustment (COLA) announcement. The wait is over, and we've got some news about Medicare Part B that you’ll definitely want to read. Let’s dive in! 🎉 First, what is COLA? For those new to the term, COLA stands for Cost of Living Adjustment. It's an annual change to Social Security and other federal benefits to counteract inflation. In essence, it helps ensure that your benefits keep pace with the rising costs of living. 📈 So, what’s the deal with COLA 2024? Without further ado, for 2024, beneficiaries will see an 6% increase in their COLA. This increase has ripple effects on various federal benefits, including Medicare. 🚑 Medicare Part B: The Big Changes! Medicare Part B primarily covers outpatient services, including doctor's appointments, lab tests, and preventive screenings. For many, the monthly premium for Part B is au...

Money. We all need it, we all want it, and many times, we chase it tirelessly. However, money’s real value isn't in the numbers in our bank accounts but in the happiness and contentment it can bring to our lives. When we redefine our perspective on wealth and happiness, we can truly say that with 'Happy Money', we can lead a 'Happy Life'. Here's my take on how you can afford everything you want—not just in material terms, but emotionally and spiritually as well. 1. Money's Real Worth Ever found yourself saying, "I'd be happier if I had more money?" While financial security is important, the essence of money is in its ability to meet our needs and fulfill some of our wants. It's not about accumulating more; it's about the peace and contentment we feel when our financial life aligns with our personal values. 2. Experiences Over Possessions Sure, it's thrilling to buy that brand-new car or the latest tech gadget. But studies ha...

Every morning, I wake up to the gentle chime of my smartphone. As I roll over and reach for it, the first thing I see isn’t the time or a barrage of emails – it’s a tiny, digital wallet icon reminding me of the money I’ve saved, the money I’ve spent, and the experiences I’ve gained. You see, I believe that money isn’t just a means to an end. It's an energy, an enabler, and when handled with positivity, it becomes 'Happy Money.' Understanding Happy Money Let me explain what I mean by "Happy Money." It isn’t necessarily about the quantity of money you have; it's about the quality of your relationship with it. It's the kind of money that's earned joyfully and spent in ways that bring genuine happiness, nourishment, and value to your life. Think about that meal you bought for a friend, the course you enrolled in to grow your skills, or even that gift you gave yourself just because you deserved it. That's Happy Money. Experience Over Materialism ...

Hey everyone! If there’s one thing in adulting I wish I had a guidebook for, it’s understanding credit scores. Picture this: fresh out of college, I thought credit was a mystical force—something only bankers and finance gurus talked about. Fast forward to me trying to rent my first apartment and getting denied because of my “credit history,” or lack thereof. Ouch! In my quest to figure things out, I’ve come across countless myths and misconceptions. Today, I want to share with you five crucial credit score facts and debunk the myths that led me astray. Let’s save you from the mistakes I made! 1. Myth: Checking your credit score will lower it. Fact: Checking your own credit score is known as a soft inquiry and has no effect on your score. It's essential to keep tabs on your score. You're actually entitled to one free report from each of the major credit bureaus annually. However, when a lender checks your score because you've applied for credit (known as a hard inqu...

  It's a question I get all the time: “As a personal finance expert, how much do you actually budget for groceries?” People often expect a solid, fixed number, but the truth is a little more nuanced than that. So, today, I'm pulling back the curtain and sharing my grocery budgeting secrets with you. 1. The Context: First, let me say that everyone's financial situation, family size, dietary preferences, and location play a massive role in determining a grocery budget. I live in a medium-sized city with my partner, no kids, and we’re both health-conscious vegetarians. 2. The Numbers: On average, I budget $300 per month for groceries. That's about $75 per week. Some months it's less, some a little more, but it averages out. 3. The Breakdown: Fresh produce : $40 per week - We prioritize fruits, veggies, and organic products. Local farmers' markets are our go-to. Proteins : $15 per week - Think tofu, legumes, eggs, and occasionally sp...

  When I first read the headline in WSJ, "Growing Credit-Card Limits, Spending Stoked Americans' Ballooning Balances," I had an epiphany. I am not alone. Many of us are grappling with the seductive dance of credit card balances and the alluring call of higher spending limits. But, like any challenge, there's a way to master it, and here's my story. The Allure of More When I received my first credit card, it was like getting the keys to a candy store. The initial limit? A mere $1,000. But over time, as I proved my creditworthiness, that limit grew. And grew. And grew. Before I knew it, I had the power to spend tens of thousands of dollars with just a swipe. And while that felt empowering, it also presented a clear and present danger: ballooning balances. The Spending Spree It started with innocent purchases. A dinner here, a vacation there, a bit of online shopping – after all, I deserved it, right? But as the months flew by, I noticed that I was only payin...

Ever heard the saying, “It’s not about the destination, it’s about the journey?” I thought that only applied to road trips and self-discovery quests, until I embarked on my financial journey. Let me take you on a rollercoaster of interest rates, inflation, and a sprinkle of “I didn’t see that coming!” 1. The 'Huh?' Moment: Discovering Interest Rates Just like many of you, I once stared blankly at my bank statement thinking, "Why is there a decimal and a percentage sign there?" That, dear friends, was my first encounter with interest rates. Imagine you loan a friend $100, and in return for the favor, they decide to buy you a coffee every month. That coffee is like the interest you earn from your bank for storing (or borrowing) your money. Over time, those coffees can add up, and if you're a caffeine addict like me, it’s a total win-win. 2. The Great Inflation Revelation One day, while proudly sipping my bank-sponsored coffee, I noticed my favorite bagel h...

  By Dalton Bob I always thought of myself as a responsible spender. That was until the day I received a letter from my credit card company announcing an unexpected boost in my credit limit. Little did I know, that small piece of paper would plunge me into a seductive spiral of increasing debt. Inspired by the Wall Street Journal’s insight on ballooning balances of Americans, I want to share my story. The Surprise Limit Increase It began innocently enough. A soft, off-white envelope with the logo of my credit card company, delivering the seemingly good news: "Congratulations! Based on your excellent history, we’ve increased your credit limit." Initially, I felt proud. It seemed like a validation of my financial discipline. I remember thinking, “They trust me with more money? I must be doing something right!” The Slippery Slope There's an undeniable thrill in knowing that you can spend more than you ever could before. Shopping sprees, vacations, dining out - th...