Test your financial literacy with the “Big Five” questions

 The following questions have been used in multiple countries to asses financial literacy. How literate are you?

1) Suppose you had $100 in a savings account and the interest rate was 2% per year. After 5 years, how much do you think you would have in the account if you left the money to grow?

A) More than $102
B) Exactly $102
C) Less than $102
D) Don’t know

2) Imagine that the interest rate on your savings account was 1% per year and inflation was 2% per year. After 1 year, how much would you be able to buy with the money in this account?

A) More than today
B) Exactly the same
C) Less than today
D) Don’t know

3) If interest rates rise, what will typically happen to bond prices?

A) They will rise
B) They will fall
C) They will stay the same
D) There is no relationship between bond prices and the interest rate
E) Don’t know

4) A 15-year mortgage typically requires higher monthly payments than a 30-year mortgage, but the total interest paid over the life of the loan will be less.

A) True
B) False
C) Don’t know

5) Buying a single company’s stock usually provides a safer return than a stock mutual fund.

A) True
B) False
C) Don’t know

Answers at: https://gflec.org/education/financial-literacy-answers/#5

Restarting Your Career: 8 Tips for Women Going Back to Work

Are you looking to rejoin the workforce or to start a professional career for the first time? Kylie Ora Lobell has excellent advice for you. She provides detailed suggestions on the following topics:

1. Find Remote Jobs

2. Sign Up for LinkedIn

3. Reach Out to Former Colleagues

4. Include Relevant Stay-at-Home Experience on Your Resume

5. Brush Up on Your Education and Skills

6. Perfect Your Body Language

7. Find the Right Health Insurance

8. Don’t Forget the Work-Life Balance

Where and How to Find Jobs

For details read the full article: https://www.moneygeek.com/financial-planning/tips-for-women-returning-to-work/

Women’s Guide to Making Financial Moves After College

 "Graduating from college is an exciting time, full of potential to begin investing in your financial and personal goals. But life after college brings its own challenges for women — especially if you’re carrying the burden of student debt, which many are. It’s helpful to arm yourself with solid practices as you embark on the next phase of your life. The earlier you’re able to start saving, build credit and knock down debt, the better your financial future will be." Writing for Money Geek, Nadia Neophytou provides excellent advice to recent college graduates (and the advice applies to almost all of us!). 

Among the topics she addresses in the article linked below are:

Common Financial Challenges Women College Grads Experience

Tackling Your Student Loan and Other Debts

Boosting Your Confidence in the Workplace

Establishing a Strong Financial Foundation

Expert Insight on Women Graduates’ Finances- this section includes advice from 6 women professionals. Check it out!

Read the full article to get the details: https://www.moneygeek.com/financial-planning/womens-finance-after-college

The Ultimate Guide to Budgeting

 I MUCH prefer the term "Spending Plan' to Budget but the same concepts apply. Having a spending plan and following it regularly is essential to creating financial stability and reaching your goals. There are SO many ways to set up a spending plan, many using phone apps or computer programs. But frankly, a paper and pencil plan can be just as effective and easier to implement. Simpler is better than more complex and more likely to actually be used.

Writing for Money Geek, Cheryl Wageman explains why you need a spending plan and how to implement an effective one you will actually follow. 

• What Is Budgeting?
• 5 Good Reasons to Implement a Budget Now
• Practical Steps to Creating and Using a Budget
• How to Create a Budget With a Spreadsheet
• Budgeting Examples for Personal Finances
• Effective Budgeting Strategies and Methods

Read the full article at:  https://www.moneygeek.com/financial-planning/resources/guide-to-getting-on-a-budget/ 

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"Loud Budgeting" started as a joke

"Making a public declaration to rein in spending helps tighter budgets stick... an idea supported by behavioral economics research," according to an article by Oyin Adedoyin in The Wall Street Journal. 

This concept of declaring your intentions to change behavior is similar to sticking to your New Year's resolutions to get more exercise. While not a new concept, the idea is to let those close to you know your goals so they will help hold you accountable... for your spending and your exercise. Advertising your spending goals with others serves as a commitment device. 

"Loud budgeting began as a joke, said Lukas Battle, the 26-year-old comedian who coined the term in a December TikTok video after a night of over-spending." it is a way to push back against peer pressure to overspend when doing it just to get along and go along with your crowd. 

Maybe it's time to get loud with your financial goals for 2024.

BTW, I dislike the word "budget," and much prefer a "spending plan."

Utah 529 educational Savings Plan gets top rating from Morningstar... for 13th year

"Morningstar released its annual 529 industry report naming Utah’s plan as one of only two plans nationwide to earn the Analyst Rating™ of Gold. The 2023 award marks the 13th consecutive year my529 has earned the investment research firm’s top rating."

What does Utah offer that offer that other programs do not? Answer: "a wide range of investment options, a commitment to keeping fees low, and an account owner-focused 529 experience with convenience and flexibility." https://my529.org/another-morningstar-gold-for-my529/?utm_source=my529+Official+Communications&utm_campaign=e40d748091-EMAIL_CAMPAIGN_2018_04_06_COPY_01&utm_medium=email&utm_term=0_5da23fe960-e40d748091-108905369

In awarding the highest honors to Utah's plan, Morningstar emphasized my529’s https://my529.org/ investment options, specifically the Target Enrollment Date and Customized Age-Based options. Utah's plan is managed by Vanguard which is owned by its investors, not by stock holders and focuses on keeping expenses ultra-low.

My husband and I invested in Utah's 529 early and often (monthly) for our niece and nephews, who live in Maine and New York. One nephew graduated with undergrad and masters' degree from the University of Edinburgh (yes, you can use 529 funds in foreign countries) debt-free. Our niece, a senior at the University of Vermont (a very costly state school), is currently in Tblisi, Georgia studying for her Russian major. She will graduate debt-free due to her 529 funds and scholarships. Her older brother chose not to pursue post-secondary education so we are taking advantage of the new federal law to transfer $7,000 (the Individual Retirement Account maximum contribution for 2024) from his 529 to his Roth IRA. We will continue this for five years to transfer the maximum amount allowed ($35k) and then use the remainder of his account for his sister's post-graduate education. 

Read the other articles about 529 plans in this blog for details.