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January 26, 2018

A 20 Year Old Could Need to Save $7 Million for Retirement

By Mandi Woodruff Courtesy of Yahoo Finance Full Article here Cliff Notes (C’mon its 13 bullet points you can read this): 20 somethings don’t save money for two reasons: “There are bills to pay, debt to be tackled, apartments to rent, and social lives to be had.” They think that their money is better served in their pockets now. Due to inflation, a 20 something will need $7,000,000 at retirement!A 25 year old making $50,000 would need to save 14.65% of their salary througout their career. In 1970, someone could have retired with just $166,000. Today, someone needs around $1,000,000. TIME IS ON YOUR SIDE! Saving 6% of your pay at 25 is much more valuable than saving 8% at 55. Case Study:IF you decide to invest while you are younger you stand to have a significant amount more at retirement and “people who do that earlier set themselves up much better for success.” Jennifer, 22, making $3,000 a month, saves 5% of her salary in a 401(k) with a 5% employer match ($300 a month). She earns 6% at year on her investment and ends up with $753,849 at age 65. (assuming she never increases her contribution or gets a raise) Jennifer decides not to invest young, instead she waits till she moves up in the company and is making $6,000 a month ($600 a month) but is now 35. Same savings of 5% with 5% match and same investment, at 65 she has $317,843. She lost out on $436,000 by waiting!!! *Note: We do not own Cliff Notes or have any relation with them with are just using them as an example of a book synopsis company.
January 26, 2018

Millennials Choose Cash—And Why That’s Not So Great

By Kate Ashford Courtesy of Forbes Full Article here Cliff Note Version: 2 out of 5 millenials, 39% prefer cash as their long-term investment.”Millenials actually get the importance of saving; They’re just not willing to take the risks with it, particularly with regard to long-term savings.” Cash is not a good pick for saving/investing money because it loses value over time due to inflation. The S&P 500 has gained 17% over the past 12 months versus 0% for cash. Millenials came of age during turbulent financial times With the financial crisis and tech bubble, young adults had a front row seat to see both events. “Even though it didn’t effect them directly, they saw the impact it had on their parents and other family members and friends.” Millenials have a poor appetite for risk, which is ironic because they are the age group most able to take on risk “Even with something as severe as the financial crisis, if you hung in there and continued contributing throughout, you not only recovered your losses, but you came out well ahead.” Millenials are the generation that most needs to get agressive with savings as they have the biggest retirement savings burden of all time. Young adults “life expectencies are longer, their healthcare cost are going to be higher, they don’t have the pensions thier parents did, and the future of Social Security is more uncertain than its been for any of their predecessors.” Young Adults are going to need a bigger nest egg, and they are not going to get there with cash in a savings account. “A key part of this is getting people to think long-term, getting them to see the power of compounding over those periods of time.”  
January 18, 2018

Is It Cheaper to Fly Or Drive?

Blog: Flying vs. Driving from Syracuse to NYC   Let’s say you live in Syracuse and have to go to NYC for an overnight trip. You have two options flying or driving. A round trip plane ticket from Syracuse to NYC was $106.60. This price is from using JetBlue, which was the cheapest airline and buying coach seats with no stops. In the City you will need to buy a cab to JFK airport and the city. The cab rate plus tolls and a tip would run about $70 one-way or $140 round trip. This brings the total to $246.6. To figure out how much it costs to drive I used the going price of gas in Syracuse, which is $2.55. The road trip is 254.2 miles one way, and I used the average 2015 car model’s miles per gallon at 24.8. Dividing the 254.2 miles by 24.8 mpg to find the amount of gallons used which are 10.25. Taking the 10.25 gallons used and multiplying the price of gas, $2.55, to get a total cost of $26.14 one way. Double the one-way cost of $26.14 to get a round trip total of $52.28 to drive to NYC and back. Remember that prices for you could be different depending on your cars mpg and the price of gas in your area and the shifting of airline prices. This is just for the trip however, in NYC you will need to park your car overnight. Let’s say you need 24 hours of parking that would cost an additional $45 approximately. This brings the total to $97.28 It is $149.32 cheaper to drive then fly, but this assumes that your time is worth nothing. It takes 2 hours and 36 minutes round trip to fly, plus the hour early you have to […]
January 11, 2018
stress

Australia Trip 2017: Day 41

So it’s the end of September and I am pretty much freaking out about money for my trip. Not only do I have to fly across the world by myself but I need to be able to afford this trip without setting myself too far back financially. As of now I have been able to save$1,400 out of my $2,500 goal. That money is strictly going to my ticket which was about $1,500. I have two more pay checks before the big trip which are basically going to go to regular bills and paying bills while I’m gone. I really need to come up with a way to make more money and FAST. I started looking at my monthly expenses and tried to eliminate some of my bills. The first thing I saw was my loans which I can’t change because I am already paying the minimum on them. The next was my gym membership which is at $30 a month. Now it’s not that expensive but I won’t really even be using it for the next two months with all the travel I will be doing. I called and asked if I could freeze the account for two months. This saves me $40 and I don’t have to pay the initiation fee when I reactivate it in December. The other bills I have are bills I can’t really do much about like cable, internet, gas and electric, and my Birchbox account (yes for the $10 a month I am not going to cancel my Birchbox account). I am still doing private lessons for volleyball and I will get paid this weekend another $110. So I have another $150 to add to my account. That still leaves me $950 short towards my goal. I have to come up with another […]
January 11, 2018

When Does a Hybrid Begin to Save You Money?

Like many young professionals, I recently found myself in the market for a new Toyota Camry. While deciding which model to choose I was hit with quite the moral dilemma, do I take into account my carbon footprint and buy a hybrid or do I try to put some money away for my fraternity reunion in Panama City next spring and purchase the less expensive gas version. To make matters worst I had recently seen Al Gore’s new movie An Inconvenient Sequel: Truth to Power and was made painfully aware of our societies ever deteriorating environmental situation. However, ice-cold beachfront Corona’s in Panama City was enough to force even the strongest willed environmentalist to swallow their pride and go with the gas version. To make a long story short, I decided to do a cash benefit analysis to decide which model I would purchase. While doing this analysis, I had to take into account several variables:   The first phase of my cost benefit analysis involved the difference in price between the two models. There was a substantial difference in price between the regular Toyota Camry and the Toyota Camry Hybrid. To provide you with the specifics a 2018 Toyota Camry starts at $24,000, while the 2018 Camry Hybrid comes off the lot at $27,800. Given this substantial difference in price I was initially tempted to go with the regular Toyota Camry. However, there were still several other variables I had to take into account, those being the price of gas, mileage and number of miles I planned on driving the car for.   The second phase of my cost benefit analysis involved how many miles I planned on driving the car for. Putting myself in the shoes of the average suburban American who often commutes 50 miles to work […]