Aiming for Less

Richard Quinn  |  Jan 5, 2024

WHAT DOES IT MEAN to “live within your means”? To answer the question, we first need to define “means.”

If your gross income is $60,000, that income isn’t your means. For starters, you need to subtract income and payroll taxes. To live within your means, you need to spend no more than your net income—income after taxes and other withholdings.

I’ll go further and suggest that your true means are your income net of monthly savings for retirement and financial emergencies.

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Path to Retirement

Kenyon Sayler  |  Nov 17, 2023

SOME FRIENDS WERE recently discussing their investment performance. I couldn’t contribute to the conversation—because I have no idea what our investment returns have been.
The fact is, I don’t find performance information all that valuable, plus it’s relatively hard to calculate since you have to account for both price changes and dividend or interest payments. To be sure, investment returns are useful if you’re looking to determine whether a mutual fund manager is adding returns in excess of a benchmark index,

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The Write Stuff

Jeffrey K. Actor  |  Sep 21, 2023

I’VE BEEN SAVING almost my entire adult life. Early on, three books put me on the path to financial success, helping me to reevaluate how I was living.
The first was The Automatic Millionaire by David Bach. This introduced me to the concept that small, automated savings could lead to big results, thanks to compounding over long periods. Albert Einstein reportedly said, “Compound interest is the eighth wonder of the world. He who understands it,

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Old Money

Philip Stein  |  Aug 7, 2023

COMMENTARY ABOUT America’s wealth inequality seems to be everywhere. According to Wikipedia, as of 2021’s fourth quarter, Federal Reserve data indicate that the top 1% of households hold 32.3% of the country’s wealth.
Meanwhile, Pew Research Center reports that the median wealth of the richest 20% of American families increased by an inflation-adjusted 45% between 1998 and 2007, while the median wealth of middle-income families rose just 16%.
And then there’s the Federal Reserve Bank of St.

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Planting Bad Seeds

Ken Cutler  |  Jul 31, 2023

WHEN I WAS A YOUNG engineer, I supervised a charismatic worker named Neil, who was a sort of pied piper to the younger engineers and technicians in our group. He was about 20 years older than us and loved to dispense advice like a guru.
His quirky advice usually had a financial component. For example, he recommended that we single guys marry women with curly hair, as that would save tens of thousands of dollars over the course of the marriage,

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A Pleasant Dilemma

Craig Stephens  |  Jun 27, 2023

THIS SIMPLE EQUATION is arguably the most important in personal finance: income – expenses = savings.
Think back to your early paychecks. Most of your after-tax salary likely went toward housing, food and maybe a few debt payments. For many of us, little was available to save each month for the first year or two of our working lives.
Then one day, on the last day of the month, there was money left over.

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How Far I’ve Come

Chris Amos  |  May 23, 2023

I GREW UP IN A SMALL three-bedroom home, the youngest of 14 children. I was always sharing a bed with one older brother or another. My father drove a garbage truck for the county and my mom washed dishes in the school cafeteria.
Money was hard to come by and, when it was in hand, it needed to be spent wisely. My parents engrained in me the importance of education, although neither had a high school diploma.

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Offsetting the Pain

Matt Trogdon  |  Feb 21, 2023

IT’S ONE THING TO talk to folks about the power of saving regularly. It’s much more profound to see it in action. I was reminded just how powerful saving can be during two recent meetings with financial-planning clients. In both cases, we looked back at 2022 and calculated how much the clients had saved.
In the first case, the clients had saved diligently throughout the year. They increased their 401(k) and 403(b) contributions, they opened and funded 529 plans,

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A Path to $10 Million

John Yeigh  |  Feb 13, 2023

JEFF BEZOS ONCE asked Warren Buffett why everyone doesn’t just copy his example when investing. Buffett famously replied, “Because nobody wants to get rich slowly.”
The magic of saving diligently, coupled with decades of compounding inside tax-advantaged accounts, can ensure financial freedom. In fact, young married couples today have an outside chance of accumulating $10 million by the time they reach the new required minimum distribution age of 75.
To reach the $10 million jackpot,

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Seed Money

Gavin Schmidt  |  Feb 4, 2023

MONEY IS OFTEN TIGHT for those in their 20s. Yes, that first “adult” job typically pays more than any previous job. Still, finding money to save and invest can be tough. After handling all the other big expenses of early adulthood—house, wedding, student loans—there just isn’t much money left over.
That’s my dilemma and one facing many others in their 20s. How can we make extra money without getting a second job? My fiancée and I focus on earning money just by living.

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Walking Around Money

Justin Sharon  |  Jan 24, 2023

ON NEW YEAR’S DAY 2022, to shed some holiday weight and make the most of one of the world’s great strolling cities, I resolved to walk several miles each day around the streets of New York.
I’ve always had a happy knack for finding money as I wander. Ideally, I’d love to have been blessed with a more glamorous superpower. But alas, my lot in life seems to be a preternatural ability to locate lost coins at a hundred paces—the result of a thrifty Scots heritage,

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Save First Then Spend

Richard Quinn  |  Jan 7, 2023

IF EVERYONE WOULD just follow my advice when managing their money, all our financial problems would evaporate.

I’m kidding, I’m kidding.

From recently viewing a YouTube video, I learned it’s necessary to track all spending, have a budget and be mindful of spending habits. Nope and nope—but yes to watching our spending habits.

Managing money boils down to discipline and responsibility. You may not be able to keep up with the Joneses, take that vacation you desire or get that next tattoo.

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Spending Their Future

Edmund Marsh  |  Nov 19, 2022

WHY DO SOME PEOPLE save more for retirement than others, even when their income is the same? It turns out that a difference in spending behavior, rather than a larger salary, may separate better savers from those who struggle to set aside funds for their future.
The Employee Benefit Research Institute and J.P. Morgan Asset Management joined forces to examine the spending and saving behavior of 10,000 households. The households, which were analyzed by age cohort,

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Know Your Worth

Austin Dorenkamp  |  Nov 10, 2022

WHAT’S MY NET WORTH? Do I know? Should I know?
These are questions I’ve thought about long and hard. After tracking the combined net worth of my wife and me for the past five years, I’ve concluded that the answer to that third question—should I know?—is a resounding yes. Before we get to the reasons, let’s start with a few basics.
What is net worth? According to Wikipedia, net worth is “the value of all the nonfinancial and financial assets owned by an individual or institution minus the value of all its outstanding liabilities.” Put another way,

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Fill Them Up

Mike Zaccardi  |  Sep 5, 2022

THE S&P 500’S RETURN so far in 2022, when compared to the same year-to-date stretch for previous years, ranks as the fourth worst since 1928. One result: Stocks look quite cheap. The market’s price-to-earnings (P/E) multiple has retreated as share prices have fallen while corporate earnings have continued to grow.
One chart in particular caught my eye last week. Each month, I peruse J.P. Morgan Asset Management’s Guide to the Markets.

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