Our Retirement Bloggers

Jean ChatzkyLaurie NordquistKaren WimbishRenee BrownLisa ArdreyNatalie BlakeneyChelsea Castner

My 40th high school reunion: reflecting on the passage of time

At my 20th high school reunion, my classmates and I were in the prime of our lives and career.  Most of us were feeling young, enjoying life and working toward our life goals.

At my 20th high school reunion, my classmates and I were in the prime of our lives and career. Most of us were feeling young, enjoying life and working toward our life goals.


“What a difference a significant passage of time can make! I recently attended my 40th high school reunion – the last one I went to was my 20th, and there’s a lot that happens in a 20 year span. While I was really looking forward to it reflecting on the past, I found myself feeling a little sad on the way home, which is certainly not an emotion I was expecting. In the days since, I’ve thought a lot about why that was.

I think some of it was what I’d call life and rites of passage. At my 20th high school reunion, my classmates and I were in the prime of our lives and career. Most of us were feeling young, enjoying life and working toward our life goals. We were in our late 30s and still had a lot of living ahead of us. Most of our parents were still with us and many of us had small children or teenagers.

Fast forward 20 years to the 40th reunion. The first thing I realized was that I couldn’t recognize many of my classmates. Several people had our old yearbook, which I hadn’t looked at in years. As I flipped through the pages, I recalled many of my classmates by looking at their senior pictures;but I sure would have struggled to pick out very many of them today without name tags! While there were a couple that I still recognized, many looked like strangers to me. The aging process is funny that way. The physical aspects creep up on you gradually so you don’t notice all the little changes over time in yourself and those you spend time with regularly. However, seeing the changes in people my age that I hadn’t seen regularly or at all over the past 20 years was eye-opening.

The hard truth is that we’ve all changed a lot, and not just physically. Many of us had lost one or both parents since we last met, some had been laid off or displaced, some were planning for retirement, almost all were empty nesters, and instead of talking about our parent’s health problems, we were talking about our own. And almost 30 of our classmates were no longer living.

I suddenly realized that “we were it.” As an older generation we are becoming the matriarchs and patriarchs of our families. We are community, civic and business leaders; church elders, grandparents and, for some, retirees. And the “somedays” no longer stretch as far out ahead of us as we always thought they would. We are now the “older generation,” and at least for me, I thought this day was a long way off.

It felt strange to suddenly realize we are the generation that younger generations now look to for strength, guidance, leadership, wisdom and experience, much as we looked up to our parents’ generation in the past. That’s quite a responsibility if you think about it, and not a little daunting.

Has a recent event or milestone in your life caused you to reflect on the passage of time and where you find yourself today? What was the catalyst for your self reflection and what revelations did you find most surprising?

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Building your nest egg in case of getting laid off

“There’s nothing fun about getting laid off, particularly these days when the amount of time it takes to find the next job is still way above historical averages. But if it this financial setback has to happen, you’re best off if – like Carolyn and her husband – you’re in a place where you can weather it financially. As she noted: “We travel. We eat out. We don’t skimp on anything except we don’t own expensive cars. We don’t buy expensive clothes. Everything is just living within our means.” That’s what I call doing it just right. Checking the following off your-to-do lists will also enable you to handle a lay-off if one should happen to come along. (On the flip side, if you’re the one who decides you simply can’t stand one more day at your current job, they come in handy as well.)

Build up your emergency funds. Financial experts’ advice varies when it comes to recommendations for how much is enough in your financial cushion. I like to see at least three months of living expenses if you’re a two-income family and at least six months if you’re living on a single income. Why the difference? Because if you have two incomes, chances are you won’t lose both simultaneously. And note Your monthly living expenses do not equal the amount you spend every month. It’s the amount you’d have to spend in a month if you weren’t spending on the things you want but don’t really need.

Put it somewhere you can access it. I know interest rates on savings and money market accounts are low by historical averages. When it comes to your emergency fund, it doesn’t matter. The money still needs to be somewhere you can get at it easily in a pinch. To me, that means in my local bank, in a savings or money market account. Not in a CD., and not in a mutual fund. I’ll earn my return on my investments instead.

Consider a back-pocket emergency cushion, too. Should your layoff drag on, you’ll want to know that you have other sources of potential cash to tap. My suggestion? A home equity line of credit. Now, as far too many people learned during the financial crisis, you don’t want to use your home as an ATM unless it’s absolutely necessary., and you do not want to pull more equity out of your home than you absolutely need. But this is one of those things you have to secure while employed. So if it sounds good to you, do it sooner not later, just in case.

Keep job networking. When’s the best time to get a new job or start a new business? When you’re currently employed. Yes, it means working a little harder, putting in considerable extra hours. But the pressure of doing these things while you have a paycheck rolling in is nowhere near the pressure of doing them after being laid off and your severance is running out. Take the time to maintain your connections, keep your resume and contacts up to date, and preserve your memberships in important organizations. They’ve never been more valuable.

Getting laid off can be devastating, both personally and financially. Be prepared for emergencies by looking into some of these easy steps today.”

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Do you have adequate insurance?

How do you view insurance for your car and home?   Does it provide more confidence for you and your family?

How do you view insurance for your car and home? Does it provide more confidence for you and your family?

Plan for the worst, hope for the best. Sage advice for all of us on many fronts, yet, planning for the worst is not how I am wired. I am optimistic by nature and use the glass is half full approach, so when I recently moved to the Wells Fargo insurance business a few months- I had to get my head around this idea of planning for the worst- whether it’s a car accident or tornado destroying homes and businesses. Actually – my head got it faster than my heart. My head understands the statistics and the need for adequate insurance coverage. My heart – got there after I heard just a few stories of customers who have encountered those unexpected and often devastating circumstances. Those who had the right insurance were more at ease that the financial impact of the event was covered- and they were able to focus on the emotional healing.

How do you view insurance for your car and home? Does it provide more confidence for you and your family?

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Costs of raising a child

The cost of raising a child is making many women think twice about having a baby.

The cost of raising a child is making many women think twice about having a baby.

“The Wall Street Journal recently reported a decline – fairly steep by historical standards – in the number of women having babies in the US. From 2007 to 2010 (the figures for 2011 aren’t quite cooked yet) the number of births fell 8 percent overall, with births among immigrant women declining 14 percent and those among US born women down a smaller, but still significant, 6 percent. To blame? The recession and the rising average cost of raising a child. In other words, women aren’t having as many children because we don’t feel we can afford them.

Exactly how much does it cost to raise a child? There’s no doubt children are expensive. The Department of Labor’s most recent estimate of the cost to raise a child from cradle to college (not including tuition) is $234,900. Time magazine’s Brad Tuttle took a look at that figure and sneered that it was absurdly low. “Moms and dads out there should sit down before hearing that this figure is probably a gross underestimate of the costs of bringing up baby.” He points to numbers in the $900,000 to $1.1 million range as a more realistic cost of raising a baby from cradle to college. This takes into account money parents miss out on because of career “sacrifices” and investments they might have made otherwise.

Stories like both of these make me think of something my mother once said: If she and my father had waited until they could afford children to have them, my brothers and I would have never been born. Even back then (in the ’60s and early ’70s) the average cost was daunting, but they, and so many other people like them, swallowed hard and took the leap. What spurred them? Was it hubris? Confidence? Optimism? Some combination of them all?

I actually think there was something else going on. College was always on my parents’ radar – they both put themselves through, but I know they had aspirations of doing that for us. (They may have also thought they’d be able to do it inexpensively as my father was working as a college professor at the time.) What they didn’t think about was keeping up: With the Joneses, their friends, family, or anyone else. They decided they would do the best that they could within their means. As those means got more sizable through the years, they spent more, but they never broke through the boundaries and they made it work.

Today, the pressure to outfit your young one with the latest in designer strollers and adorable apparel starts well before birth. New parents are encouraged to purchase their way to safety (think baby-proofing), comfort (in both clothing and decor), and intelligence, unnaturally inflating the cost of raising a child. It’s time to step back from all of that.

Moving forward, I’m hoping for a time of fewer comparisons and more self-focus. Thinking about what we know deep down our children need rather than what marketers (or already co-opted other parents) tell us they need, has to be a better way to move forward. The thought of a couple not having the baby they’ve been dreaming about simply because they don’t think they can keep up is simply too depressing.

What do you think?”

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Financial counseling: A smart move for a newly blended family

When my husband recommended that we sign up for financial counseling, I didn’t blink. Why? It didn’t take long for us to realize that if we were going to land on the “for richer” side of marriage we needed a financial plan.

When my husband recommended that we sign up for financial counseling, I didn’t blink. Why? It didn’t take long for us to realize that if we were going to land on the “for richer” side of marriage we needed a financial plan.

When my husband recommended that we sign up for financial counseling, I didn’t blink. Why? Because when I need help getting in shape, I schedule a few sessions with my personal trainer without hesitation. I didn’t think twice about pre-marital counseling. Well, I didn’t blink at first. Logically it made sense. While we did touch on money issues during our martial counseling, it didn’t take long for us to realize that if we were going to land on the “for richer” side of marriage we needed a financial plan. Can love & money mix?

When I learned my employer offered free counseling, the timing couldn’t have been better—yet I was hesitant. The thought of sitting down with someone talking about “my money”—which was now “our money”—caused me some anxiety. First, I had to quiet my inner know-it-all. I’ve been buying books on personal finance and watching “money tip and makeover” television shows for years. “This stuff should be clicking by now,” I told myself. Fortunately, I was able to get past all the “shouldas” and schedule the appointment.

Truth be told, a whole lot has changed since I purchased my first money book. I plan to continue reading money articles, books, and watching money shows, but I’m also ready to work directly with financial professionals to get more help applying all the great financial information to my personal situation. Team Blakeney has opened joint accounts and closed others. Bill paying is more fun thanks to financial date nights and much easier to track, thanks to really cool smartphone apps. While the here and now part of finances has gotten a lot easier, now it’s time to tackle the longer term goals. So I soon got over myself and my inner know-it-all was silenced (for now anyway).

Fast forward to the day of the session and our blended family, “Team Blakeney”, is in full cram mode working to complete our homework: an assessment form we downloaded from the counseling agency’s website. Unfortunately, life got busy and we didn’t get to the pre-work prior to our session. However, having an appointment not only kept us focused on the task at hand, but also made us more accountable. We had a goal, a deadline, and a really good sense of where we thought our money was going. Just having an appointment was making us more productive.

Our assigned financial counselor called at the appointed time and Team Blakeney was ready. Turns out he didn’t yell at me about every wrong money move I’ve made since my college days (when a free water bottle was a very good reason to sign up for a credit card). In fact, the entire session was a “judgment free zone.” There were even a few lighthearted moments when we got to a line item where one member of Team Blakeney tended to overspend. It’s official: Team Blakeney loves eating out, gadgets, and hair salons (well, that one is mostly me). However, there wasn’t any finger pointing or unrealistic vows to strip our lives to the bare bones. Instead, the focus was placed more on setting up a financial plan that would help us to stick to the budget, save more, and pay down our debts.

Thirty days later, Team Blakeney had a follow up appointment to report our spending—an assignment designed to see exactly how much we’re actually spending when we write everything down. This wasn’t the first time we attempted to track our spending, but having a scheduled follow-up session with our financial counselor marked the first time we BOTH stuck to it. Both sessions helped us see that our blended family is anything but cookie cutter. For example, for us, travel isn’t a leisure item. During the school year the girls are in another state with their mom, which means lots of driving up and down the interstate for extended weekends, spring breaks, and holidays. In addition, the majority of my family is spread out over four states, which means flights and road trips are required line items in the budget. While we weren’t going too far over budget, our second session helped us see that we have more line items than we thought and that we need to proactively save for those times when certain line items will spike.

Financial counseling is pretty basic, but two years into blending finances and family traditions, basic goals are necessary and helpful. Why? Because having information is one thing, while applying it is another. Slowly but surely new habits and goals are forming. Team Blakeney is taking the whole “for richer” vow much more seriously.

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Finances and special needs children

When you have a special needs child in your life it's important to address the financial steps you may want to consider to help ensure that these children are taken care of.

When you have a special needs child in your life it’s important to address the financial steps you may want to consider to help ensure that these children are taken care of.

“Headlines about special needs children make me cringe. One out of every 68 children has an Autism Spectrum Disorder according to the Centers for Disease Control. How did the numbers rise so quickly? Wasn’t it just last month it was one in 150? When are we going to figure out what’s going on? That is a question best left to the researchers, I suppose. But that means it’s important to address the financial steps you may want to consider to help ensure that these children are taken care of.

Most people I know have at least one special needs kid in their life. For me, that child is my nephew, Ben, whose autism is so severe it is a certainty that he will need care for the rest of his life. For Ben, as for so many other children with special needs, planning the financial scenario is complicated. But here, essentially, is how it works.

For most special needs children, government programs such as Medicaid and Social Security Income (SSI) are vital for long-term support. Medicaid and SSI are federal programs, but states regulate and administer the benefits. The rules vary by state, but most states require your child–at age 18–to have assets below a specified amount, not including a home or car, to qualify for programs.

If you leave money or assets to your child directly through a will, when he turns 18 that money will generally be counted against him when it comes to determining his eligibility.

Enter the “special needs trust.”

A special needs trust is a special account that the tax code allows you to create for special needs kids. You can fund it with any assets you’d like to pass on to your child, including real estate and paper investments such as stocks or bonds. But because this account is managed and the proceeds used for your child’s needs, rather than owned by and managed by your child for his own wants and needs, anything in this trust is not counted against your son or daughter for Medicaid or SSI purposes.

If you have a special needs kid, and you are planning to create a special needs trust, you will probably want to establish it sooner rather than later. Why? Because it needs to be in place to receive your assets in the awful case that something happens to you and your spouse. The good news is that the process is simple provided you have some help from an estate planning attorney. You will need to appoint a trustee to manage the account in the event you and your spouse are no longer around. Your best bet is finding a planner or estate planning attorney who specializes in these trusts. One option to locate someone is through either the Special Needs Alliance or the Academy of Special Needs Planners.

What is one of the best ways to fund a special needs trust? The vast majority of parents use life insurance. In fact, according to MetLife, many of these trusts for special needs children are funded by life insurance settlements. Survivorship life insurance, which allows you and your spouse to buy coverage under one policy that doesn’t pay out until the second spouse dies (it’s cheaper than a policy written on a single life), can cover costs such as estate taxes. It can be a great way for grandparents to pass money along for your son’s future. They will just need to designate the trust as the beneficiary. Keep in mind that this option only works if you have enough money not only to support yourself after the death of a spouse without the help of life insurance benefits, but also to continue paying the premiums on the policy until you yourself pass away.”

Please consult your accountant, tax advisor and/or legal advisor to see if a special needs trust is suitable for your personal situation.

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Take advantage of being empty nesters

My husband and I are dealing with empty nesters' syndrome.

My husband and I are dealing with empty nesters’ syndrome.

“In previous posts, I’ve mentioned that my husband and I are dealing with empty nesters’ syndrome. We have more free time now that our kids are out of the house, but struggle with what we should actually do with it. We still have two kids in college, so we need to be thrifty about our expenditures. And our oldest– who just got her first “real job” after college – still needs us to supplement her $12/hour job. So, what have we done with our free time while staying within our means?

We can decide on moment’s notice to go to a movie. My budget mode still kicks in so we are usually using a movie coupon or going before the evening rates start. We are also following some of our passions. My husband loves to sail and has been sailing quite a lot on his NACRA sailboat. It’s about 25 years old but well maintained.

One of my passions is cooking so I took a cooking class this summer. Learning new things seemed important, and I needed some one thing to get me out of my empty nester rut. A cooking class was the perfect thing. A couple fun things I learned: to cut up basil, roll a few leaves together and then slice. Sounds simple (and it is), but it works really well. Don’t crack an egg on an edge. This was quite hard for me – heck, I learned to crack an egg on the edge of a bowl or counter top about 44 years ago – but I did try the suggested technique of hitting the egg on a flat surface, using your two thumbs to pull apart the shell where you hit it on the flat surface. The advantage is no shells get in with the egg. Voila! It was true.

I was pretty proud about learning something new. Who said you can’t teach an old dog new tricks? When you and your spouse find yourselves as empty nesters with extra free time, follow your passions, you’ll be surprised how fast the time will fly.”

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Be prepared financially for life-changing events

“When you go through a life-changing event – a divorce or separation, the death of a spouse, a layoff, a major move – it can feel like your finances are in free fall. But often, getting to the point where you feel financially secure, can help you feel better about the chaos around you. I know that when I was going through my divorce, socking away every penny I could to provide the security blanket I needed.

Lisa felt the same way. Her year-and-half-journey to divorce (that many of you have followed on our blog) forced big financial decisions and events: buying a new house and a new car. All of a sudden, life was moving very, very fast. I know many of you are likely in similar situations. Let’s outline how to make a financial plan for yourself and be prepared:

Build a reserve. Having cash on hand really makes all the difference. It means you can move if you need to, put a down payment on a house, or buy a car as Lisa did. It means you have money in the bank, if you’re newly living on one income, in case you lose your job or suffer a major emergency. All of that goes a long way to helping you sleep at night after life-changing events, so put your head down and focus on building up your savings account balance. Then check it every month or so. Watching that growth will make you feel better.

Tackle the unknown. Often, no decision is the worst decision. But if you’re suddenly in charge of your complete financial picture, when previously you were sharing that burden, it can feel a bit paralyzing. Do a little research to boost your confidence, then make a decision. It may not be the perfect choice, but at least you’re moving forward. If you mess up, or change your mind, you can do something else.

Get financial help. Major life changes are a good signal that it’s time to consult with a financial advisor. He or she can look at where you stand and hold your hand as you make the aforementioned decisions. A good advisor will help you figure out how much home you can afford, if you’re moving, whether you should buy or rent; and what you can do with your assets to make you feel more secure.

Don’t be rash. In a case where you’ve received a windfall – a divorce settlement or inheritance, for instance – my best piece of advice is to sit on your hands for a while. Put it in the bank. I know it won’t earn much – barely any – interest, but it will give you time to think about what you want to do with that money, and it will keep it liquid during this tumultuous time while you’re making major decisions. Once you’ve thought it through, and perhaps met with a financial advisor, you can move it into an investment that will earn more of a return.

The most important thing is to be prepared for these life-changing events. Often times they can’t be avoided and can come out of nowhere.”

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Cooking up Your Financial Future

Planning a dinner starts with a first step and so does planning your financial future.

Planning a dinner starts with a first step and so does planning your financial future.

As a millennial I know how frustrating thinking about your financial future can be, especially when we’re struggling to get our financial present figured out. My brother, Morgan Castner, a Wells Fargo Advisors Financial Advisor, once said to me, “Chelsea, you can’t afford not to pay yourself first.” Okay, okay, I get it, but how do I start?

Getting clear about your retirement goal is the first step that sets the tone for all subsequent moves in planning your financial future, but this could very well be the step that’s tripping you up. It’s difficult to set a goal today for a change that’s likely 40 years away, especially since your future situation is unpredictable.

A strange analogy came to me while I was thinking about the retirement planning process. Every year for Thanksgiving dinner my mom buys the most gigantic Butterball turkey, unsure of how many guests will actually be sitting around our table. She’s already determined that her goal is to minimize her stress so she can enjoy the day, so buying a bigger bird is her action step to avoid the worry there won’t be enough. The results? Grateful, stuffed guests and enough leftovers to give her a break from the kitchen for the next few days.

If your retirement plan was your turkey, wouldn’t you want to be prepared for the extra guests who might show up unannounced to your retirement party dinner? It could be your spontaneous friend named Vacation or your dreaded second cousin Medical Bill. Unfortunately, life doesn’t come with a recipe that tells how long you have to cook your savings in order to enjoy a happy retirement meal, but what you can do is determine how you want to feel when you hit retirement.

As to not over complicate it, I would suggest simply writing down this sentence: “When I’m living in retirement I’m going to feel _______.” Use words like comfortable, free, liberated, spontaneous, calm, joyful, reassured, whatever comes to you. Then, ask yourself what will it take to feel that way. Will that mean trips all over the world? A second home at the beach? Having enough money to cover unexpected emergencies?

Next, play around with Wells Fargo’s online tool, My Retirement Plan, to figure out a ballpark figure to shoot for. It makes it easy, clear and fun (yes, I actually said fun) to calculate how much money you would need to be saving now in order to have your retirement dreams become reality.

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Family Finances: What I Learned from My Mother

Discussing finances with your family can get complicated, but it's worth the effort.

Discussing finances with your family can get complicated, but it’s worth the effort.

My mother, Elaine Sherman, and I participated in a webcast about talking to your parents about family finances. It was part of a series of conversations moderated by More magazine and sponsored by Wells Fargo. We were interviewed, together, by Jennifer Braunschweiger, More’s Deputy Editor. I hope our web audience learned at least a few things. But as I always do when listening to my mother, I did as well.Among them:

Family meetings are a fraught concept: Sometimes when families are faced with a crisis – an older parent lacking funds to cover healthcare bills or escalating living expenses – an adult sibling decides to call a meeting to sort it all out. Having everyone in the same place to talking about money and marshalling resources seems like it would be a great idea. But my mother pointed out that siblings who don’t have the resources of others may feel put on the spot. Another option? A series of sequential conversations to get everyone on the same page. Group emails can also be particularly helpful.

Parents may not mind being asked for help getting out of debt. Parents who have the resources to help may, in fact, be very willing, particularly if the debt was incurred as a result of a job loss or some other event not in the adult child’s control. That said, my mother suggested parents not to take on the full responsibility for paying down the debts. She’d want to see the child making headway on his/her own as well and noted that perhaps their contributions could be matched ala 401(k).

A financial advisor can be a partner for a parent whose lost a spouse. My parents always managed the family finances on their own while they were married – with occasional help from their accountants and attorneys. They never had a financial advisor. But when my father died, my mother lost her financial sounding board. Truth be told, she always managed the money more than my father did. But she’d bring big decisions to him and they’d hash through them together. Without him, she was on her own and not comfortable with that. She has found a financial advisor stepped into that role quite nicely. She’s comfortable talking to him about big money issues. He’s both manager – for things she doesn’t want to do anymore – and sounding board. In other words, a partner for hire.

Even when they’re adults, you can still talk to your kids in the car. One of the big problems with conversation in general is that technology stifles it. It’s rare to have a conversation these days over the phone without the computer or smart phone doing its attention-grabbing thing in the background. The truly important conversations, like ones about family finances, my mom suggested should be tackled where technology is not in the way – doing the dishes after a family dinner, perhaps. Or, as you did when they were teenagers, on a radioless drive in the car.

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