Wednesday, June 10, 2015

Nine Recommendations for New Workers



Laszlo Block, Google’s Senior Vice President of People Operations, posted comments on what employees should do when they start a new position.  He certainly has more credibility than I do, and that's okay, but my youngest started an intern position and I had to think about what advice to give him.

There are some basic rules when you work for someone in an office environment.

1. Be on time (or even a little early). I'll tell you from over thirty years of experience that a boss doesn't care if you stay until ten o'clock at night - but he cares if you show up five minutes after he/she tells you to be there.

2. Personal hygiene is important. Take a bath or a shower. Wash your hair. Brush your teeth. Please do not smell offensive to your coworkers.

3. Dress well, like a young professional. Some employees might be wearing t-shirts and sloppy jeans, but that doesn't need to be your attire. A three-piece suit and tie are no longer the norm (thank goodness) but a nice shirt and nice pants always look good. (Yeah, I don't have any personal advice for women - sorry.)

4. Be courteous. Leave the attitude at home, or just toss it out of your personality entirely. It isn't attractive. In meetings, be quiet and attentive and speak when asked to do so.

5. Nap at home. Do not take a nap at your desk - that includes lunch times. If you are that tired, you are not getting enough sleep - and you need to fix that while you are not at work. No boss likes to see an employee napping, especially a new hire.

6. Surf at home. Your work computer is for work. If you do not have enough to do, ask for more. Reading personal emails and doing Facebook updates can wait until you are on your own time.

7. Speaking of Facebook, be loyal to the company that is paying you. You might disagree with what they do or how they do it. You might be a genius and know better ways to accomplish something, but don't bash your employer on public media. It's disloyal - and it's rude. No bashing co-workers either.  Just don't post specifics about work at all.

8. Take notes. I know that sounds trite, but keep a daily log of what you're doing. Record key events and key people. Write technical notes for yourself - how to logon to that testing environment, or what those command lines were that gave you access to the team notebook.

9. Don't try to change the Corporate culture. If you stay with the company for years, then you might take a stab at doing things the better, faster way that only you perceive, but wait to do that.

(Captured from Top Small Companies)

Whether you are working for the summer or starting your first full-time position, remember that it takes a while to learn the basics of your workplace. Everyone was new once and they had the same problems you face now. Most coworkers will be happy to help you get past the rough spots. Don't give up. It's always hard at first, for everyone.

In the movie Harvey, the main character says "Years ago my mother used to say to me, she'd say, 'In this world, Elwood, you must be' - she always called me Elwood - 'In this world, Elwood, you must be oh so smart or oh so pleasant.' Well, for years I was smart. I recommend pleasant."

Employers are looking for energetic, courteous people who want to work hard. Be that person. In a few years, you can help some new employee. He or she will be just as baffled then as you are now.



Tuesday, May 12, 2015

Retire Early 4 - Financial Weeding



Everyone hates weeding.

When we were young, Mom always had a garden. Mom let the ducks wander through her rows of vegetables, though she didn't allow four young boys unfettered access. "Ducks will eat the bugs," she said, "and leave the plants alone." You never know. Four young boys might have eaten bugs, too.

When we were old enough to know the difference between the plants and the weeds, Mom sent us out into the garden. You have to exercise good judgement when weeding so you do not pull up the good plants with the weeds.

In our garden this spring I was willing to let the weeds grow for a while, so I could more easily distinguish them from the plants that will bear tomatoes, squash, cucumbers and melons. I let them grow too long, because weeds, when left unchecked, will take over a garden.

It looks bad.
 When I finally did weed, it took a few days, and some of the weeds were so intertwined with the plants that I had to pull good plants up to remove the weeds

Some people say you can let the weeds grow, that they don't affect your plants. That's wrong. The weeds in your garden will suck up the nutrients and the water that the good plants need.

What does this have to do with Finances?

You should remove the weeds from your spending habits, too. Take a hard look.

Do you simply go to the gym to use the treadmill? Walk in your neighborhood instead, and save yourself the cost. Do you have all the premium stations on your cable? Pick one and cancel the others. Do you have too many minutes on your phone plan? Analyze those and see if you can go to a plan with less cost - or change phone services completely!

Those obvious weeds are sucking the life from your savings, a little bit at a time.

Sure, some weeds look like beautiful flowers. Do you need the latest phone on the market? Do you really need a faster, newer computer? Please think more than twice about a new car. A car is a functional device that gets you to and from places. If you use it as a status symbol, you are pushing your own retirement down the road for a few more years. Is it worth it? You have to make that decision. (Darling sold my old car at a garage sale, she was so sick of seeing it, but that's another story.)

In Retired Early #3, I gave guidelines and standard categories for making a budget. If your expenses seem out of line in any one of the categories, look for ways to save money. Here are some ideas.

Housing deserves its own post. Buying a house is the single biggest expense facing most families, but the monthly cost should still be affordable. Most of the people I know who work into their late sixties or early seventies bought a house that was more than they could comfortably afford - and they worked extra decades to pay for it.

Housing expenses fit into the same budget category (sorry, folks). Small faucet leaks and running toilets can bump up your water bill. Think about putting a brick (or some other volume item) into the water reservoir for your toilet. Turn off lights and computers (and printers) when you are not using them. Think about investing in a programmable or smart thermostat for your house. Just a few degrees of air conditioning can make a big difference in your monthly bill.

There are many ways to save money on food. Coupons, of course, are a great money-saver. Some big name stores match the lowest price, so just having the advertisements when you go to the store can save you money. Buy sale items. You should shop at a dollar store for basic items; at least drop by and see what they have. You hear it all the time, because it's true - don't shop when you are hungry!

Your second biggest expense is your car. I mentioned that above, but car buying deserves its own post as well. There are two rules about buying a car that worked well for me for decades: 1. Buy a used car, not new and 2. Keep your car as long as you can. Almost everyone needs to finance a first car. When you are finished paying the monthly bill for that, keep putting the same amount into a special savings account just for your car. Buy all the rest of your cars with cash.

Everyone should shop around for less expensive insurance, and do it yearly. Students can often get discounts, as can senior citizens. Some companies offer discount percentages on insurance (and lots of other things). It's your money. Keep as much as you can.

Debts are your enemy. Again, that deserves its own post, but as far as debt goes - just don't do it.

Entertainment and eating out are an integral part of our society. We feel we need the relaxation of a night on the town. Look for and use restaurant coupons. Go to museums and zoos during free days during the week (fun and educational!) or buy half-day tickets at theme parks instead of a full day. Have you checked into the movie theaters near your home? We buy tickets at a local cinema for $4.50 instead of the bigger theaters for $8.50. (Yes, they are first-run movies.) Look in your own neighborhood for a less expensive theater option.
RB40 has a great list of frugal hobbies in one of his posts.

Clothes are not a big expense item for me, but I'm not concerned with sartorial elegance. I have bought designer suits at Salvation Army and Goodwill, with nobody wiser. They have half-price days, too and that's when I shop. Houston has an amazing Charity Guild that has fabulous prices for designer clothes.

Investments are another story, and I'll cover them in a future chapter, but they need to be weeded also. That's a lifetime job, actually, retired or not. Simply put, the buy high and sell low method isn't effective for building savings. Drop the ones that lose you money, and your personal tolerance determines the sale point.

Darling informed me that there are a lot of savings tips for young parents, so I'll save that for a later post as well.

For now, this should be enough to think about.

Check your budget for weeds and pull them so your savings have a better chance to thrive. That's the path to retiring early.

Look! Plants!



Wednesday, May 6, 2015

Social Security isn't secure

There's a fascinating article on the Yahoo finance page about social security with a bit about the Simpson-Bowles Plan. As we mentioned in our book Preparing for the Fiscal Cliff (published at the end of 2012), we can't count on the government for support as we age. This concerns me a lot now that I am nearing my age for withdrawing social security.

Have you noticed all the advice on the financial sites in the last few years? I've yet to see one that doesn't tell you to wait to withdraw your social security benefits. Sure you'll get a few hundred a month more if you wait (they specifically tell you it is 8% more per year), and the math is correct. Figures don't lie, but liars can certainly figure. Yes, it's true that waiting will give you a larger monthly paycheck, and if you can wait - like you are still working - then maybe go ahead and wait. But Social Security payouts were designed to give you the same total by the time you die, so you don't get  a net gain until you are in your eighties, and that doesn't take into account the investments you might make.

I don't want to sound like I believe in conspiracies, but the government is the one who benefits most if you delay taking your Social Security. For one thing, our government representatives can kick the unpopular decision of how to fix the system down the road a bit. They don't need to worry about their retirement, after all. I'm pretty sure they don't have the same system citizens do.

I plan to get my social security the minute I qualify for it. I'll spend it while I can, invest it if I'm able - but I'll get it back in my own pocket as soon as possible. I don't want the government to handle my money any more.

I don't mind the Yahoo article. Social Security has long needed reform. It's a Ponzi scheme of the highest order - and if it wasn't the government, the people who ran it would be jailed for the rest of their lives. What I object to is a little sentence in the fourth paragraph: "Graham wants to address the problem now and get entitlement funding in place for generations..."

Do you see it? I put the key word in bold and italics. Government officials - and our government of the people, by the people and for the people - is starting to spin the tale that social security money is entitlement.

That's my money. I paid into the Social Security system for over thirty-five years. I wasn't given an option. I had no say how the money was used. They took it directly from my paycheck and charged my employers for the privilege of doing so. Then they managed the money poorly, just to add insult to injury.

Yes, Social Security needs to be modified - the simple mathematics is obvious to anyone. But don't go telling me it is an entitlement. Don't forget where the money came from - my pocket - and it wasn't a donation. It was supposed to be an investment in my future.

We need to keep watching our government, keep watching the people who represent us, keep watching the people who stand apart from us and delegate financial rules they don't have to follow themselves. Now we need to watch carefully the words they use when talking about our money. If we don't, they'll rob us of what is ours.

And we'll have none to blame but ourselves.

Tuesday, April 28, 2015

Retire Early 3 - Start Planning



In the last Retire Early post, I went over my formula for determining if you can retire now. If you can, that's great! We'll cover some of the headaches associated with retiring early in a future post. For the rest of you, let's talk about getting ready to retire early.

The key to retiring early is saving enough money to do so.  That sounds easy, doesn't it? Some people get jobs that pay well. Some wait to hit it big with the lottery. Just for information, according to statistics, lottery winners declare bankruptcy at twice the national average

I agree with many of the other experts on early retirement, though. The key to retiring early is to reduce your expenses. Let's look at a breakdown of expenses for a family making $50K a year.
Caveat: I believe in supporting my church and the work it does, so I always build a ten percent tithe into my budgets. That's reflected in these numbers.


If there are children, some of these numbers must shift into the School/Child Care category. That can be very expensive and for many couples it is more cost effective for one parent to stay home.

These are generic numbers, of course. You can see that the savings (10) and investments (13) provide only $3750 per year for building a retirement nest egg. That is 7.5% - but it can be immediately increased to $5625 per year (11.25%) if you aren't paying any debts (7).

Let me make a single dramatic statement here: debt is your enemy. When you have a balance on a credit card you are working for the credit card company and not for yourself. They'll retire early and you won't.

If you can pay your house off, you jump to saving $17,875 per year, or 35.75%. Now we're talking.

Mr. Money Mustache has an excellent post: Getting Rich from Zero to Hero in one blogpost.
He makes the surprising claim that "if you can save 50% of your take-home pay starting at age 20, you’ll be wealthy enough to retire by age 37. … If you can save 75%, your working career is only 7 years." I studied his numbers and the math works.

For most of us, saving 75% of our pay isn't feasible, but think about it a minute. You didn't spend much in college or when you first started working. The trick is to keep the expenses low.

Now you might say to me "Sure that might work for some people, but I just can't do that. I'm already forty and have a lot of expenses.

Yeah, I get that. I was forty-two and reeling from my second divorce in ten years (that's an entirely different story). I had no savings, no pension, and owned nothing of value. My car was ten years old and pretty beat up, but it drove well and I didn't owe money on it, so that was okay with me. I lived in a rented two-bedroom apartment in a mediocre part of town for a mere $600 per month.

I still had bills and child support payments. I cut my lifestyle down a bit but didn’t suffer much. I don't do nightclubs; I don't smoke and I rarely drink. I eliminated all my debt within the first year. I wanted to retire, so I started saving - a lot.

Today's society pressures you to buy a new car, to live in a fancy part of town and to spend money on a lavish lifestyle. You can do that and keep working until you drop dead in your cubicle at age seventy-two or you can plan on your early retirement. It's your choice.

You can see from Mr. Money Mustache's post that it takes about seventeen years to build a decent retirement account if you save fifty percent of your income. I started saving as much as I could, which was about a third of my paycheck. Each raise got put into a savings account or into my 401K. When possible I raised the amount I put into savings. Pretty soon half my income went into some sort of savings plan.

Fifteen years later, at age fifty-seven, I retired. I don't travel to the Riviera or vacation in lavish resorts, but I don't need to get up and go to work every day. Now I can focus on doing the things in life that I always wanted to do, like write my first novel.

You can do the same. You just need to find ways to put more of your earned money into savings.
Look at ways to cut your costs. In the next Retire Early post I'll have a list of ways that Darling and I use to save money and that you can start using now.

***

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Monday, April 20, 2015

Early Retirement Blogs (and a few others)

I follow a number of retirement blogs that focus on early retirement, and a few on other retirement options (mostly overseas). It occurred to me that others might not only be looking for good blogs (besides mine ;).

Joe Udo's blog Retire by 40 is one of my favorites. Joe consistently lays his finances out there for everyone to see, which is genius if you ask me. And brave.

I don't know his real name (if it is in the blog, I missed it) but the blog of Mr. Money Mustache is awesome and full of mind-blowing concepts - like smarten up and spend less. Except he's a bit more cranky about it - and twenty years younger than I am.

I just started reading Justin's blog at Root of Good and I can tell I'll be spending some time reading the back posts. Fascinating guy with a lot of good ideas on retiring early. His experiences don't parallel mine, so for me it's entirely new insights. He says he gets about 50,000 pageviews a month! Wow.

I'll admit now that I get International Living's magazine and have for years. I do take what they say with a grain of salt, though. We know people that live in some of the countries they cover on a regular basis and I think IL writes in a very optimistic style. Having said that, they are a fascinating read and their web site might be worth a visit.


On non-retirement sites, I follow Rants and Rambles. Nate Boateng doesn't write a lot, but he posts items from other sites that catch his interest - and they are often interesting to me, as well. I'm appreciative of all the reading he must do to find the good ones...

I think everyone in the world follows the blog of Tim Ferriss. Man, I sure wish the guy read (and liked) my books. Well, I like his books - and I like his blog.

I also follow the blog of Wil Wheaton (repeat comment on Tim Ferris, above). So does everyone who ever watched STTNG. Even the ones who didn't like Wesley Crusher.

Along the same lines I follow the blog of James Altucher. He almost always has something interesting to say. I once wrote an app just to follow him - I called it the James Altucher Portal. It was on both platforms for a while - Apple and Droid. It isn't there any longer, but I'll put it back when I clean up the coding. The site I used to help me do the app now costs too much and puts too many of their own ads on the app. It was embarrassing.

I just won't post an app unless I would be willing to use it.