Do you think “money” is still a taboo topic to discuss with friends and family? What about complete strangers? Seriously, I had to really ask myself, “what is it about the subject that people find… More
Today is the last weekend of 2017 and my last check-in for the She Makes Cents 52 Week BINGO Money Challenge for the year. In fact, this past Friday marked 104 consecutive weeks of doing this money challenge successfully. In the past two years, I have eliminated my credit card debt altogether as well as shaved YEARS off my student loan repayment term. More importantly, I have cultivated a habit of saving money. Personal finance is 80% behavior and 20% head knowledge according to the financial writer, Dave Ramsey. To be successful doing this money challenge I had to change my behavior and put saving for my money goals above fleeting things and experiences. That was something that took a few failed attempts to learn. Yes, a few years ago I would start the challenge, hit a mini goal, and fall off. Then two years ago, I realized that I had to do something different if I wanted different results… and so I did.
What is the 52 Week BINGO Money Challenge?
The BINGO Money Challenge is a variation of the popular 52 Week Money Challenge that I created back in 2013. The original challenge called for people to save money according to the number of weeks of the year. For example, on week one you would save $1.00 and on week 52 you would save $52.00. At that time in my career, I had a base salary and I worked on commission so my checks were never consistent. I attempted the challenge and failed. Hey, it happens. I then thought to myself, girlfriend…. you should make a “bingo” version… So I created my first bingo money card and started saving because the original version did not work for me. I needed something that would set me up for success. The thing is, it doesn’t matter if you cross off $52 dollars on the 52nd week of the year, all that matters is that you cross off a box on the money card every week. Either way, you end up saving the same amount of money and you have the ability to save more or less based off how your current financial situation for each week. Since then, the BINGO Money Challenge has evolved into a money challenge with unlimited savings potential.
Who is the SMC Money Tribe?
The support from She Makes Cents readers started to pour in when I began sharing my progress on the 52 Week BINGO Money Challenge. At the time, my money goals were top of mind but also was the new realization that I had to report my progress to people who were invested in my success. I started to get emails and social media shout outs from readers who started the bingo version of the challenge themselves. Before I knew it, I had accountability partners that I have never met who shared their progress. We supported the BIG wins and the days were all anyone could afford to save was $1.00. We were on this money-saving journey together and friendships started. Now, the SMC Money Tribe is an uplifting community of women from all over the world that supports each other’s financial journey and savings endeavors. Every year people contact me for the latest version of the SMC Bingo Money Card and I found that the most successful people had one major thing in common. In fact, people were 79% more likely to complete the challenge if they are active in the SMC Money Tribe. It makes sense when you think about it because you have accountability partners there to lift you up when the challenge gets hard to keep up with.
How to Join the 2018 SMC Money Tribe
The new 2018 SMC Money Tribe Facebook group will serve as a “home base” for the #SMCmoneytribe. There you will be directed to fill out a quick registration form and download the money card. This is a space for active members and as a member of the SMCmoneytribe, you will gain exclusive content, motivation, and financial tips and tricks that will help you whether you are saving to pay down debt like me or saving to take a fabulous trip or two in the new year (also me). This year, you will have the option to do your weekly check-ins on Friday and/or Saturday on all of our social media handles to make it easily accessible to people who are only active on certain platforms.
Here is how you get started…
- Join the SMC Money Tribe Facebook Group
- Complete the registration form to select your weekly check-in date
- Follow She Makes Cents on Instagram, Twitter, Facebook
- Pick a savings goal & get ready to save some $$$$ in the New Year
A few weeks ago, a company called HealthIQ that celebrates health-conscious people with social and financial rewards, contacted me to create a quiz about millennials and life insurance. Yes, I can now add professional quiz writer to my resume! Since then, I have been reflecting on what happens to our loved ones financially when we pass on. This also came around the time a classmate of mine from high school passed away suddenly from a random heart complication leaving his fiancé and young daughter to pick up the pieces. One day you are living life and YOLOing and the next moment….well, you know how that goes. I am no longer in the headspace of thinking I am invincible, which means it is time for me to get a plan for my family in case the worst happens. Apparently, that means I’m growing up. While doing my research for my quiz, which you can take here, I realized there are several benefits to buying life insurance at an early age and right now millennials are in the best position to take advantage. While it is not a cheerful conversation to have, it is a necessary one and one that can protect those who depend on you and your income should the worst-case scenario happen. Since many millennials are delaying marriage and children, it is easy to say that there is no benefit of buying life insurance; however, that is not the case. Other dependents such as parents who co-signed a loan or business partners for the millennial entrepreneurs out there also depend on you and your income and will be left with a great financial burden of debt, your funeral expenses, and trouble covering living expenses if proper measures are not in place.
What Is Life Insurance?
If you ask my new insurance agent, he would tell you that life insurance is a “love policy”. I, however, prefer the explanation from Fidelity, which explains that, a life insurance policy as “a contract with an insurance company. In exchange for premium payments, the insurance company provides a lump-sum payment, known as a death benefit, to beneficiaries upon the insured’s death”. To bring it to terms that we can all understand, it is what GoFundMe has become when loved ones pass. I have to say this, but GoFundMe should not be your go-to plan to cover the funeral expenses of a loved one or to cover the financial burden that you may leave to your family.
Do Millennials Need Life Insurance?
Yes and yes. It will be easier to understand once you break things down into life stages. Millennials make up the awesome generation of people who are born between 1982-2002 which means that older millennials could be in the home buying, marriage, and kids stage while younger millennials are in the college life and first real job stage. So do all millennials need life insurance? The answer to that will depend on whom you ask. I believe everyone should have life insurance that at least covers one’s funeral expenses. Now in terms of a larger payout, known as a death benefit, I think that depends on who relies your income. To determine if you need life insurance, financial expert, Suze Orman, presents this question for you to ask yourself: “If I were to die today (or if my spouse/partner were to die today), will those I/we support be able to take care of themselves? If the answer is no, then you need life insurance”. Let’s be honest here, the subject of life insurance is morbid, boring, and a bit off-putting, but it is a necessary conversation that needs to be had by all.
5 Things Every Millennial Should Know About Life Insurance
If Your Parent Is a Cosigner On Your Student Loans. A few years back, I remembered hearing a story about a grieving father who was struggling to pay his dead son’s student loan debt. During the height of his grief and after paying for funeral expenses, debt collectors began to harass him regarding his son’s missed student loan payment. That was the first time I remember learning that your debts don’t always go away when you pass. I thought about that Dad and then I thought about my own. So what happens to your student loan debt if you pass away? If you have Federal student loans, your loans will be discharged and your family will not be responsible for your debt. Parents with Parent PLUS loan borrowers are also eligible loans to have their loans discharged in the event of the student’s death since it is also a Federal loan. To receive the discharge, the surviving cosigner must submit a copy of the death certificate to their loan provider. However, if you have private loans, your family may inherit your debt, which for the class of 2016 is an estimated $37,172 and growing. According to this article from CNBC, “Even if your spouse doesn’t co-sign for you, he or she can also be held liable for a private student loan if you borrow while married and you reside in a community property state”.
If You Are a Single Parent.
While millennials are delaying getting married, a recent poll from Gallup reveals that almost half of surveyed millennials age 34 have children although they have never been married. Because of their single status, many parents elect their minor children to receive the death benefit to financial protect their children if something were to happen. Making a minor a beneficiary will cause major problems since life insurance companies do not payouts to children under the age of 18 or their guardians. If you are a single parent, you should consider setting up a trust to benefit the child and naming that trust as the beneficiary. This way, you can avoid costly court fees and you can have things managed based on the directions you have left in your trust.
If You Have Life Insurance Through Your Employer.
Congratulations, you have a real job with real benefits! I am so proud of you. Now it is time to go through and fully understand the scope of your benefits package. Many employers offer life insurance as a part of their benefits package, but is that enough? Something else, I would like you to consider is how long you plan to stay with your current company. According to a Gallup report, 21% of millennials have changed jobs within the past year. Employee life insurance is provided as a group life plan and when you leave your job, you are no longer a member of the “group”. Your former employer is no longer obligated to pay the premium; therefore, your coverage is terminated unless you convert your policy to an individual plan, often at a higher rate. Your best bet is to get an individual term policy in addition to your employer-based policy so that you will be covered.
If You Think Life Insurance is a Financial Investment.
Life insurance is NOT a financial investment. Let me say that again. Life insurance is NOT a financial investment But what about cash value life insurance, you ask?
That’s not what your agent told you, is it? The good folks over at Investopedia define cash life insurance as “a type of life insurance policy that pays out upon the policyholder’s death, and also accumulates value during the policyholder’s lifetime”. Sounds good, right?
Well not so fast… The idea of investing is appealing… even sexy to most millennials (or is that just me?) but insurance as an investment is a terrible idea that yields a very low return. If you are looking to invest your money or save your money, there are much better options out there like mutual funds, Roth IRAs, stocks, and bonds. Suze Orman maintains, “Under no circumstances do you want ‘cash-value insurance’ no matter how fabulous the agent makes it sound”. My financial guru, Dave Ramsey, agrees. Ramsey argues, “It is a horrible product that makes insurance companies the most money, which means insurance salespeople get the best commission on this trash”. I am inclined to agree with them both. Insurance is insurance and your investments are investments. Does life insurance provide financial protection for your family? Yes. Is the “investment” component of a cash life policy, also referred to as whole life, universal life, and variable life, a good investment? Absolutely not. If you have this type of policy, you should cancel it and thank me later.
If You Don’t Know Where to Start.
Many people know the importance of life insurance but have not taken the plunge. For the millennials out there, you will never be as young as you are right now in this moment. Why not take advantage of the financial benefits of buying life insurance while you are young and in presumably good health. Millennials with a clean bill of health will find qualifying for coverage easier and more affordable, think less than $300.00 for the year for a $500,000 policy. So what type of policy do you recommend? Millennials looking to buy into a life insurance policy should consider a term insurance policy because the policy length can be tailored to your needs, it’s affordable, and you can lock in your rate while you are young. The maximum term for a life insurance policy is generally 30 years. Since premiums never get cheaper, millennials can get an upper hand on their finances by locking in a lower rate for the maximum term.
I recently read something from Dave Ramsey that completely changed how I think of all of this… adulting. “The death rate for human beings is 100 percent. You are going to dies someday! None of us know when that’s going to happen, but that doesn’t mean it should catch us totally unprepared”. Yes, you can still enjoy your youth while protecting your future. That’s why I have recently jumped on the life insurance bandwagon and you should too. Last week the Mr. and I met our agent in person to talk about our options and I encourage you to do the same. In fact, through a collaboration with Health IQ, I am now able to offer readers of She Makes Cents and exclusive discounted rate for life insurance (for more information, click here).
It starts with a question that leads to a ring, which ends up as a picture on Instagram, and is shared on Facebook. Yep, he asked and she said yes! Weeks later, you find a charming note in your mailbox asking you to stand beside her on the most important day of her life. You, my dear, are a chosen one… also known as a bridesmaid. Since 2010, I have been in seven weddings and I witnessed at least twenty of my girlfriends walk down the aisle toward wedded bliss. In fact, when the Mr. and I got married in 2015, we were the 13th wedding that year of our friend group. Like many of you, I have taken off work and flown clear across the country in support of LOVE. Too bad that the support of LOVE often comes at a hefty price tag.
She Said Yes, But Should You?
It is truly an honor to be asked to be in someone’s wedding, but before you say “yes”, you need to understand what you are getting yourself into before you make that commitment. Just like in a romantic relationship, money can throw a major wrench into your friendship if you are not honest with yourself and the bride about your financial situation. As a bridesmaid, I have paid for gowns, shoes, hair, mani/pedi, makeup packages, jewelry, liquor, plane tickets, hotels, car service, chipped in for engagement parties, hosted bridal showers, lingerie parties (apparently that is different from the bridal shower and the bachelorette party), oh yeah…bachelorette parties, bridal teas and even décor elements for the actual wedding. Nowadays, you have to add the matching bride tribe outfits for the bridal party photoshoot to the list of expenses you have to think about when saying yes. Did I even mention the wedding gift…eek? Once you accept the invitation to become a member of the bridal party, you are committing to this experience for richer or poorer.
I will admit, that years ago I declined the request to be in a friend’s wedding because the costs of being in the wedding would have been a strain on my finances. That bride thankfully understood. I often think, if we didn’t have that conversation and I participated in her bridal party, she could have very easily interpreted my reluctance to spend money as a lack of support and enthusiasm for her big day. Not having that conversation would have cost me more than financial security, it could have cost me our friendship.
How Much Does It Cost To Be A Bridesmaid?
Back in 2011, the Wedding Channel estimated the cost of being a bridesmaid averages around $1695.00. Based on this estimate, I could have very well spent almost $12,000.00 on other people’s weddings. Can you imagine what the average is now? It always makes me wonder how Katherine Heigl’s character in 27 Dresses could afford to be in 27 weddings, plus her own, on a personal assistant’s salary. To pay for my expenses as a bridesmaid, I used the envelope system before I even knew exactly what that meant. I set aside a certain amount of money each check for each bride.
Brides, be nice to your bridesmaids…your “chosen ones”. They are the ones who are holding you down during one of the most beautiful and possibly stressful times of your life. They do far more for you than you realize. Bridesmaids, remember that your bride is a bride only once (fingers crossed) and she has a vision for her day. If you are both honest from the beginning, then you lessen the chance of unrealistic expectations from both sides.
Long gone are the days where you sit around and cut coupons to save money. This is the time for cash back apps, digital coupons, and automatic promo codes that make the things we buy every day, more affordable. If you are not saving a little money on your everyday purchases, you are missing out. Months ago, I introduced She Makes Cents readers to the Cash Back App, Ibotta. I shared my review of Ibotta after using it for one month because I was impressed with how easy it was to earn money quickly with minimal effort by shopping for the things I would normally buy. Seriously, they have over 300 supported Ibotta retailers so there is no excuse not to earn money. Since downloading the app, I have earned money back from buying groceries, clothing, Uber rides and even experiences from Groupon (I used that one as a birthday gift for the Mr. last year). The $10.00 welcome bonus was also a great boost to add to my lifetime earnings using Ibotta. Since then, I have learned a few ways to raise the earning potential so that everyone can get more money even faster.
How to Use Ibotta
How To Earn More Money With Ibotta
- Welcome Bonus. Who doesn’t love FREE money? A few people (my hubby included) missed out on the $10.00 welcome bonus because they did not know how to redeem it. Repeat after me: “We are not leaving money on the table anymore”. This happened to them because they didn’t understand that after downloading the app with my promo code (tahbinu) you MUST redeem your first rebate within the first month of setting up a new account. You will receive your special bonus AFTER you have redeemed a mobile shopping offer or an in-store offer (Any Brand and Any Item offers excluded). Follow the link to begin earning money with Ibotta.
**Please note: Make sure you sign up through my link on a unique mobile device that is not already associated with another Ibotta account. Also, remember to verify an offer (excludes “Any Brand” or “Any Item” offers) within the allotted time period found on your bonus.**
- Add Things You Are Planning to Buy to Your “My Offers” When You Find Them. The folks from Ibotta suggest that you should save your desired offers as soon as you see them. It is what I do especially when I am planning our household meals for the week. I quickly scroll through to see if any of the items on my grocery list are also cash back items and when they are I add them to “My Offers” tab on the navigation bar. I find it to be a much easier process when it is time to redeem.
- Try to Redeem Offers Weekly. Unless you are on a no spend week, I imagine that you will make a purchase from one of the 300+ retailers at some point during your week. I say this, not to encourage you to shop and spend more but more so to make you aware that it really is easy to earn money back from things you are already spending on. You can earn even more by redeeming weekly offers and earning bonuses with your team. Plus when you check back weekly, it ensures that you won’t miss out on the option to opt into additional bonuses that usually have a bigger payout.
- Invite Friends. Build Your Team. Earn Cash $$$ Faster. By simply inviting friends to Ibotta and helping them redeem their first offer (excluding “Any Brand” and “Any Item” offers) you earn money and they do too. Build your team by inviting friends. Each month, your team will be given a total earning goal. If you and your team reach the monthly goal, everyone on your team will earn a cash bonus! The more friends you have, the faster you will earn.
So far, the SMC Book Club has read books that covered some of our favorite topics- money, career, lifestyle, and female empowerment. Well, ladies, our next book selection is slated to give us all of that. Since the recent relaunch of the SMC Book Club, I wanted to bring back a book that may be familiar to some of my longtime readers. This month’s She Makes Cents Book Club selection is from author and master life coach, Cara Alwill Leyba. Cara is known for encouraging women to create a ”Champagne Life” that entails living effervescently, celebrating themselves every day, and making their happiness a priority. Through loving guidance, support, and an expert perspective, Cara empowers women to challenge their fears and create a lifestyle and career that feels authentic, vibrant, and inspiring. She sounds like #shemakescents, right?
This post contains affiliate links, which means I get a little $$$ if you make a purchase through my link. For more info, see my disclosure policy.
The Girl Code
Every time I take a trip to my favorite bookstore, I come across this book,Girl Code: Unlocking the Secrets to Success, Sanity, and Happiness for the Female Entrepreneur and I tell myself that I will add it to the SMC book club reading list. Well, that time is now! This book has a rating of 5/5 on Good Reads and I can’t wait to dive in. You may be thinking to yourself, “I’m not an entrepreneur” but I am confident that the information and inspiration from this book can apply to all women at every stage of their careers.
How Our Book Club Works
This virtual book club currently “meets” weekly for mini book chats in the SMC Book Club group on Facebook. A book will be selected every other month and then announced before the start of the month to give participants time to order the book from the >SMC online bookstore, borrow from the library, or download >here. Selections for the books come from a mix of editor and reader suggestions. For reader suggestions, we ask that selections embrace powerful women, business cents, fictional favorites, and anything that informs and inspires us. As you read the book, please leave your questions for the book club in the comment section below. We will begin the book on March 1st (our Blogversary) and discussions will follow on Instagram and our Facebook group starting Wednesday, March 14th at 7:00pm (EST).
You can tell it is tax time because people are starting to get ultra fabulous on Instagram. You wonder to yourself, how in the hell are they affording this and that? Well, it is actually NONE OF YOUR BUSINESS! Repeat after me…. “What other people do with their money is none of my business!” What is YOUR business is what you do with YOUR money, especially if you are one of the 31 billion Americans who get a tax refund. According to the IRS, the 2016 average tax refund was worth $2895.00. With that knowledge in hand, retailers hire the best of the best marketers to sell you things you don’t need to impress people you don’t know or maybe even like. They count on you to CONSUME and not to make smart money moves. It’s time to stop spending like we are RICH and start making money moves like the rich. Below are 3 money ways to spend your tax refund that some form of your future self will thank you for.
Pay Down Debt
US households with debt carry an average $15,654.00 in credit card debt, $173,995.00 in mortgage debt, $27,669.00 in car loans, and $46,596.00 in student loan debt according to NerdWallet’s 2017 Household Debt Study. Often it isn’t even the original amount of the loan that keeps us in an indebted state, rather, the interest that accrues that can turn a $60,000.00 student loan into $120,000.00 in less than 10 years. TRUE STORY! Regardless of how and why you amassed debt, it is time to pay back what you borrowed. Billionaire businessman and investor, Mark Cuban, advises people to “pay debt off first. Freedom from debt is worth more than any amount you can earn”. Every extra payment that you make to pay down debt is an extra step earned on the journey to financial freedom. In fact, depending on the amount of debt you carry, using your tax refund to pay down or pay off what you owe creditors could have a bigger return on investment in the long run. If I were to get a tax refund, this is exactly what I would do with the money.
Building Your Emergency Fund
Building your emergency fund is ALWAYS a smart investment in your financial security and future peace of mind. When the unforeseen (operative word here = unforeseen) happens, you won’t have to start at zero to pay it off. When emergencies pop up, most people reach for credit cards to pay them and then the cycle of debt continues. When we use credit to pay off emergencies, we are really paying for the emergency itself PLUS interest. Dave Ramsey agrees, “The cycle of dependence on credit cards has to be broken. A well-planned budget for anticipated things [think Christmas and car repairs] and an emergency fund for the truly unexpected can end dependence on credit cards”.
Fund Your Roth IRA
Once you have your emergency fund funded for 6 months worth of expenses and you have eliminated your debt (not including mortgage), you would consider using your tax refund to save for retirement. A Roth IRA is a tax-sheltered retirement account for individuals to save after-tax income for retirement. Unlike most other money moves that have to be done before December 31st of the previous year, you can continue to make contributions until the tax deadline of April 18th (2018) up to $5,500 for people under 50 years of age. If you do this, that money will compound in your favor and when you withdraw your contributions and earnings, after age 59 ½, you will get way more money back then the refund you put in it. Did I mention this money would be both tax-free and penalty free?
It’s a new week. You made it through the Super Bowl, but more importantly, you actually went to work instead of calling in for bereavement leave for Jack Pearson after lasts nights’ episode of This Is Us. Congrats, that is a mini win by itself. As we all begin a new week full of promise and progress, I want to urge you to take a deep look at things we unconsciously do as a form of self-sabotage. If we can self-correct these things that we are all guilty of, from time to time, we will be better with how we handle our money, careers, relationships, and lifestyle goals. In order to do better, we must know better and to know better, we must make self-reflection something that we do often. The smart, beautiful, diverse and encouraging financial accountability community affectionately known as the SMC Money Tribe inspired this post and I hope that it inspires a bit of self-love to some really dope women.
Every week, tribe members are encouraged to take part in financial check-ins where they share their weekly wins and progress on the She Makes Cents 52 Week BINGO Money Challenge. In that space, women are not afraid to toot their own horns by celebrating their big and small wins. I’ve noticed though that many of the tribe members have been a little hard on themselves lately and embarrassed by their smaller strides. Maybe you are not as far in your debt free journey as you thought you would be. Or maybe, you haven’t actually started yet. Either way, it is time for a mindset shift toward positivity and abundance. One day or day one? Are you ready? Let’s get started.
Stay in Your Lane
We all remember this moment when the swimmer, Chad le Clos, took his eyes off the prize to see what Michael Phelps was doing. If only he stayed in his lane and stayed focus. How often do we get caught up in what other people are doing? We focus on other people’s money, their careers, their relationships, and whatever else they are doing for the Gram. Instead, we should invest that energy in our own money, career, and relationships. When you take your eyes off the prize to see what other people are doing, you are wasting time that can be spent cultivating better habits for yourself. Le Clos wasted his time and lost. Let that be a lesson to you. What other people do is NONE OF YOUR BUSINESS!!!! When you stay in your lane, there is nothing to distract you from the target in sight.
Evaluate How You Measure Your Own Progress
I have noticed lately that members of the SMC Money Tribe get embarrassed when they are crossing off a lower number on the 52 Week BINGO Money Challenge, especially when other members of the community are crossing off higher numbers for the week. That is because they are measuring their progress against the progress of someone else. I spoke a little about this on the She Makes Cents Instagram page, but I want to go a little deeper here. Instead of measuring your progress by how far you have left to go, instead, celebrate how much progress you have already made. Think about to your starting point and know that you are in a better place than where you first began. I created the BINGO version of the 52 Week Money Challenge was because I knew that there would be weeks where I could not afford to save a lot of money and in those weeks I could select a lower amount to cross off of the money card. I would rather save a small amount than nothing at all and that fact that the SMC Money Tribe and I save money EVERY WEEK and put it toward our money goals is something worth celebrating by itself. Also, if you wait until you have saved a significant amount of money or are in a place to make a lump sum payment
For this week and moving forward, I charge you to check how you measure your own progress and how you focus you are on your goals at hand. Write your top money, career, and lifestyle goals on a piece of paper and put it up somewhere where you will see it all the time. Stay focus on your goals. Create a strategy to reach your goals and don’t’ be afraid to celebrate your wins, big or small. Have a great week!
An Individual Retirement Account (IRA) is a savings account where money grows tax-free. Any individual, regardless of age, who has earned income, can contribute to an IRA and the earlier one is able to do so, the better compound interest works in one’s favor. The money used to fund an IRA must come from taxable income, which the IRA explains, “can encompass more than just one’s annual salary. Taxable income can include profits from stocks or real estate sales, winnings from the lottery, betting the dogs or horses, and winnings from any casino (domestic or abroad). Even the cash value of bartered items is considered taxable income”. As of 2017, the maximum individual contribution for an IRA was capped at $5,550.00. However, people 50 years or older, are allowed to save an additional $1,000.00 for a maximum contribution of $6,500.00 as a sort of catch-up contribution since they are closer to retirement age.
The Difference Between Traditional & Roth IRAs
IRAs fall into one of two categories, a Roth IRA and a Traditional IRA, and the opportunity for your money to grow tax-free is one of the most appealing benefits of this type of retirement account. Even with the benefits, Uncle Sam still requires his cut. The most distinct difference between the two types of IRAs, Roth and Traditional, is when you pays taxes on the money. With a Roth IRA, you pay the taxes up front and with a Traditional IRA, you pay the taxes at the time of withdrawal. Regardless of the type of IRA one chooses, a person can access one’s money once they hit 59 ½ years old, without being hit with a 10% tax penalty for early deduction.
Even though Traditional and Roth IRA play by different rules, those differences allow you to select the best account type for you that helps your money grow tax-free until you reach your retirement years. Once you understand the differences between both types of IRAs, it will be easier to understand which account is best for you. Check out this Roth vs. Traditonal IRA infographic from Business Insider that breaks it all down.
Do you remember the story of the tortoise and the hare? Both tortoise and the hare had the same goal…to get to the finish line; although, the strategy for getting there was vastly different. The hare was quick, took a few shortcuts and thrived in moments of instant gratification. He prided himself in how quickly the finish line came into sight, so much so, that he gave himself a moment to stop, even briefly, when he was on the brink of success. But enough about him for now. Let’s chat about the tortoise.
Even though his pace is much slower than the hare, he is consistent . Step by step, no matter how big or small that step is, he kept moving toward his goal. This folks, is where the lesson “slow and steady wins the race” originates. While the hare was sleeping, the tortoise slowly passed him by and reached the finish line first.
In my personal financial journey I have been both the tortoise and the hare. Years ago, I took half of my emergency fund and applied it to my credit card balance because I was impatient and wanted the instance gratification of a zero balance. In that moment, like the hare, that finish line was in sight...literally I had about $600.00 balance that I owed. Instead of paying at the pace that was working for me, I stopped, departed from my financial plan, deviated from Dave Ramsey’s Baby Steps and I cashed out. A week later an actual emergency happened and I couldn’t take care of it in cash. So that very credit card balance that I risked it all to get to a zero balance instantly increased because I had to pay for the emergency on credit. There are times when we know what the best course of action is and we take the “easy” way out. I risked my financial stability and I lost money and time. One thing I did gain, though, was the hard lesson… “slow and steady wins the race”.
Since then, I have taken a tortoise stride to becoming debt free. I set my pace to put money toward my money goal EVERY week using the She Makes Cents 52 Week BINGO Money Challenge. In January of 2017 my balance on my student loans was $19,000K+ and by December 31st the balance was $12,500.00. This part year I saw the largest decrease in the loan balance in the 10 years I have been . This partly because I figured out exactly how my interest accrues. Once I understood that, I was able to break my larger goal down into micro goals.
January Recap: 52 Week BINGO Money Challenge
This year I set an “paid in full” date of October 2019. To reach that I have set a new goal to get my balance down to $10,000.00 by May 1st. With the help of the Mr. we are knocking out debt together. Every week I select a number on the bingo money card and I send that amount to my student loan providers. The pace may seem slow to some people, but it is a pace that ensures that I continue to maintain the habit on constant saving. I started at the year off with a $12,505.00 balance (that extra $5 is because of interest) and I am closing out January at $11,945.62. Based on all of the awesome progress that member of the SMC Money Tribe are sharing in our group, they are also cultivating great habit with an encouraging community of like minded-women.
The future is FEMALE and that future is NOW! In the past year, I have seen an increase of women taking the reigns over their money and careers with a never seen gusto…at least since I have been an adult. Women are investing in themselves, their money, their careers and their lifestyles and are encouraging other like-minded women to do the same. Last week we learned that She Makes Cents, the premier money and career blog for goal-setting millennial women, was selected by Feedspot as one of the Top 40 Women Financial Blogs on the web. The list, which was announced early January of 2018, features a mix of content producers who share similar goals- bringing personal finance to a female audience. She Makes Cents Founder, Danielle YB Vason shared her experience with her #SMCmoneytribe. “I am thrilled to be recognized amongst the list of well-known financial influencers and brands that I both follow and admire,” Vason admits. “As a blogger, it is easy to feel like you are talking to yourself out there on the web, so when you have your hard work recognized, it’s a very humbling feeling”. So where did She Makes Cents rank? Well, we are pleased to announce that She Makes Cents the blog came in the top 20 ranking at #19.
Other bloggers included on the list were some of our favorite reads such as City Girl Savings, My Fab Finance, and the brand Daily Worth, which topped the list at number one. According to Feedspot, “This is the most comprehensive list of best Women Financial blogs on the internet” and the blogs that made the list were reviewed under these criteria of Google reputation/search ranking, influence on social media, quality of posts, and Feedspot’s editorial team and expert review.
A word from our founder
I am so thankful for the SMC Money Tribe for joining me on a shared financial journey. Your stories and questions have helped to shape the content that is created for this blog. When I created She Makes Cents, my goal was to help millennial women become more financially literate. I wanted to inform and inspire readers to use their “cents” to live the fab life. I wanted to encourage the community of goal setting women to define what the fab life means to them. I hope that I have done that and I will continue to do just that… inform, inspire, and encourage. Congratulations to the SMC Money Tribe because this recognition is a reflection of your debt free journey too.
Sometimes unexpected things happen…the past two years have been proof of that. The thing is, we cannot give anything the power to paralyze us in a state of anger, fear, grief, complacency, etc. Today I wanted to share one of my favorite quotes from Dr. Martin Luther King Jr. I like this quote because it reminds us that there will be things in life that will attempt to block your path to greatness. Sometimes we can even block our own blessings. Instead of giving up when there is a roadblock find another way to get to your goals.
If you can’t fly then don’t shrug your shoulders and throw in the towel. It’s so much easier to give up after the first roadblock (See “How To Come Back from A Setback”). Lace up your favorite pair of sneakers and get to running, girlfriend. You might not get to your greatness quickly, but as long as you keep moving forward you are taking the necessary moves to get you one step closer than you were when you realized that flying was not an option.
On the first day of the year, I asked readers to share their 2018 power word that reflects their goals and visions for themselves. The response to that one question, which was posed to all of our social media networks, was both inspiring and eye-opening. It occurred to me that in place of resolutions people are looking to find a purpose that flows into multiple areas of their lives. As people responded with words like happiness, growth, self-care, and consistency, I couldn’t help but think of books I would recommend to inspire people based on their chosen word. The power of choosing a word that you hope will define your year is that it forces you to reflect on areas of your life that you want to be better or that deserve your focus. Once a word is selected and claimed in advance, you prepare yourself to receive all of the good things that come with that word. My inspiration for the next SMC Book Club read comes from the idea of one taking an active step toward applying one’s own word to one’s life.
February Book Selection
This is the year to do better and be better and I resolve for our group to be great, supportive, consistent, and a place for goal setting women to come together. The energy in the SMC Book Club during our last book, Boss Women Pray, was so amazing and I want to build on that and I want to inspire you to be successful with your power word or else it will lose all power over your life. For the month of February, we are going to do something a little different. Instead of reading the same book together, let’s take the month of February to read a book that is inspired by the word of the year that you chose yourself. My hope is that each of you follows through and make the time to find a book that relates to YOUR word; a book that inspires you toward your self-mandated purpose to you have selected to help guide you this year. According to U.S. News, 80% of people give up on their resolutions and New Year goals by February. Let’s be the 20% together by starting our new book on February 1, 2018.
How Our Book Club Works
Every other month, we select a new book from a mix of editor and reader’s suggestions. For reader suggestions, we ask that selections embrace subjects such as power women, money, career, and lifestyle that informs and inspires us. We then announce the book selection here on shemakescents.com before the start of the month to give you time to opt-in and get your copy of the book from the She Makes Cents store on Amazon. Discussions for the book take place in our weekly book chats in the SMC Book Club group on Facebook as well as the She Makes Cents Instagram page. Trust me, the dialogue in the group is LIFE!
Since everyone will be reading different books for February, the book chats will be tailored to this unconventional reading experience. If you would like book suggestions based on your power word, let me know. I can be found on social media at the @shemakescents handle.