My Wedding in a Week: The Decision & The Venue

Holiday greetings, money nerdlings!

I know things have been pretty quiet in the L$G world over the past couple of weeks. There’s a lot going on at the moment, but a major reason it’s been so quiet is actually a pretty good reason: I got married!

Now, you might think I could have been a good blogger and set up some posts to cover my absence from the keyboard, and you’d be right, except that I didn’t know I would be getting married until less than a week before we said “I do”.

You read that right. Even though we got “engaged” on Monday, November 20th, we managed to have a wonderful wedding on Sunday, November 26th. I learned so much in that week about myself and weddings in general that I couldn’t pass up the opportunity to share it with you all.

Hooked yet? Settle in, because I’m going to share all the delightful details with you over a series of posts I’m calling the My Wedding in a Week series. We’ll talk decisions, cost, and lessons learned. Enjoy!

moz-popcorn

Making the decision

Health problems in my family prompted my lovely boyfriend, Joe, and I to pull the wedding trigger at breakneck speed. We’d been dating for 7 years, so it wasn’t like this was completely unexpected, but we’ve always been that couple that took things slowly and steadily, so we caught a lot of people off-guard with this decision.

We had been talking about getting married soon for a few months, and had even gone ring shopping. Then, on that Monday, we were on the phone talking about how everyone from both our immediate families was coming into town for Thanksgiving and it hit us: why not get married while everyone was here? It sounded crazy, but we decided to go for it.

Despite it being so last-minute, as soon as we told people the news, everyone — EVERYONE — immediately asked what they could do to help. I’m going to tell you right up front that this wedding would never have been the success it was without the help and support of our families and friends. This will be a theme in these posts, and the whole process just solidified how important a network is and how you really never know who you know until you need help.

We told our parents and siblings first, since we had to make sure they all were okay with the date and time we were aiming for. Once we had them on board, we messaged our friends to let them know. Every local friend we told was able to make it. Score!

At this point, we kind of thought we’d done what we could attendee-wise. Thanksgiving is a tough time for people to travel last minute and it was going to be a Sunday wedding, which meant most people would need to be back at work on Monday.

However, to our surprise and delight, several members of Joe’s family moved mountains to get here and what we thought would be a 20-person gathering turned into a 40-person celebration.

The Venue

This is probably the biggest obstacle when planning a wedding at short notice. Most professional venues require pre-booking and deposits. Restaurants are great options for small, quick weddings, but you might have to guarantee certain spending limits to make it worth the restaurant’s while and you’re stuck with whatever food they happen to make.

We got lucky: Joe’s parents offered their home as the venue.

Joe’s parents’ house is right on a body of water and their living room is open and gorgeous, with cathedral ceilings. They had even already thought through how they would host a wedding there since another family member is getting married next year and had considered their house as a venue. The choice was an easy one: a home wedding it would be!

The Cost

We didn’t pay for announcements/save-the-dates or invitations since we just called or emailed everyone with the information. Cost: $0

Since most of our guests were local and several others could stay with family, only a couple of people needed to resort to hotel rooms to stay, so we didn’t need to reserve a block of rooms or anything. Cost: $0

Our venue needed no reservation or pre-booking, and the food, drinks, furniture, and decorations were going to be separate. Cost: $0

I used a claddagh ring I already owned as an engagement ring, since we hadn’t finalized one yet, and it’s currently serving as my wedding band! This will be a future expense, since Joe wants to buy me something to represent our new milestone, but I love my placeholder. Cost: $0 (so far)

Wrap up

Of course the decision to get married and the announcement are easy. The venue worked out wonderfully, and we didn’t have to worry about a ring for me, but there was still so much to consider. Our so-far free wedding wasn’t going to stay that way!

Up next: Decorating the venue

What is a Social Security Number?

If you’re a citizen or legal resident worker of the US, you have a Social Security Number (SSN). You’ve probably heard the term thrown around a lot, especially when something like the Equifax hack happens, but you might not know exactly what a Social Security Number is or why it’s so important. That’s what we’ll be tackling today.

What is Social Security?

Social Security is a program that helps provide income to people once they retire or become disabled. Its name comes from the fact that the program gets society to work together to provide financial security to retired workers.

It can be a little complicated, so I’ll cover just the basics here.

The way it works is that current workers put money from their paychecks into the Social Security program while current retirees take money out. If you look at a pay stub, you’ll see the Social Security contribution listed as part of what’s been taken out before the employee got paid.

When today’s worker’s retire, their Social Security money will be provided by the people who are in the the workforce then, and so on.

To be eligible to collect Social Security, people must meet certain age requirements and have worked for at least a certain number of years. The amount of money people are allowed to get from Social Security in retirement depends on how much they earned while they were working.

What is a SSN?

Your Social Security Number is a 9-digit number you are assigned when you become a citizen, permanent resident, or temporary worker resident of the United States, which might be when you’re born or later in life.

Everyone’s SSN is different. These numbers were originally used to keep track of how much you contribute to the Social Security program, but they have become a way to identify people and in fact are probably the most important piece of identifying information in the US.

Everyone who has a SSN is issued with a Social Security Card that lists his or her number. It looks something like this:

inside_ssc card template

Image credit: www.nyc.gov

Why is it important to know your SSN?

You will be asked to provide your SSN in basically any situation that requires a major financial interaction. These include getting a job, getting a loan or mortgage, and even opening a bank account, although some banks will accept other forms of ID.

You shouldn’t carry your Social Security Card with you every day or store your SSN anywhere it might be lost or stolen. Memorizing it is safer and more convenient and allows you to fill out forms without relying on your card.

Who should know your SSN?

Be SUPER picky about who knows your SSN. The fewer people who know it, the lower your chances of having your identity stolen. Immediate family members like your parents, spouse, or children are really the only people who might need access to your SSN, and never let anyone have this info without knowing exactly why they want it. It’s probably safer to just let your family know where to find your card if there’s an emergency rather than telling everyone the number directly.

How to protect your identity

Never give out your SSN online without knowing who is asking for it and why. Legitimate companies and banks will never ask for that information through email.

When possible, only fill out forms in person or through a secure internet connection. That means no random public WiFi or cell service.

Ask if you can just not give your SSN when you’re asked for it. You might be surprised how often it’s optional. Medical offices, for example, often put a space for your SSN on their forms but don’t actually require it.

I wish I’d known that years ago before frantically calling my parents to find out my SSN at the dentist’s office (back before I’d memorized it). I took so long to finish that form because I got hung up on putting in my number, which probably didn’t even need to be there! Sigh.

Keep your Social Security Card somewhere safe and secret. I’ll say it again: that place should not be your wallet. If you keep it in your wallet and your wallet gets lost or stolen, you’ve basically just handed a stranger the keys to your identity. Losing your cash, ID, and credit cards is bad enough without worrying about your SSN being out there. Also, it’s a huge pain to get a new Social Security Card.

A fire-proof safe is the ideal place for something this important, but at least keep it in a file or box with other important papers so you can grab it at a moment’s notice.

By the way, I know the card seems flimsy and easy to destroy because it’s paper, but you’re not supposed to laminate your SSN. It makes it more difficult to recognize some special qualities on the card that prove it’s real.

You can store your card in a specially-made holder, but a nice, simple way to protect your card while it’s in storage is to keep it in a sandwich bag that zips closed.

Wrap Up

I hope it’s now clear what your Social Security Number is and why it is important. Make friends with it. It will be with you longer than most things in your life: jobs, pets, furniture, and maybe even your hair.

Just remember:

keep it secret

How I paid 2 cents for 2 items of clothing

I love Nordstrom Rack. It’s one of my top go-to places when I need to replace something in my wardrobe. It has all the brands and quality of a department store at much lower prices. I especially love the clearance section. You never quite know what you’ll find and if you’re looking for something less classic and more trendy, it’s a great place to check. We all want to be on trend, but we definitely shouldn’t be shelling out full price for clothing that’s going to out of style in a season.

So, yeah, I love the Rack, but recently I had a bizarre and funny experience that I absolutely need to share.

The story

A couple of weeks ago, my boyfriend, Joe, and I went shopping and stopped into the Rack near us. After a lot of poking around and hemming and hawing, we chose four items, all on clearance, and went to check out. One of the items I’d chosen was a bralette, and when the lady at checkout rang it up, she laughed.

“This only costs a penny!” she told me.

“What?” I asked, “How is that possible?”

What I learned is that when something has been marked down repeatedly in clearance, it sometimes gets dropped to a penny. Nordstrom Rack employees are supposed to regularly scan all the clearance items and remove any that show up as $0.01 from the rack entirely and send them to reject-clothing heaven (AKA the warehouse).

“But you found it before it was taken away!” she said, beaming at me.

Cool. I love a little money win. The bralette had only been about $4 anyway, but woo!

She continued to ring us up, and then gasped.

“It happened again!” she said. “I’ve never see it happen twice in one transaction!”

Joe and I exchanged confused glances. What she had just scanned was a thick wool shirt for him that had been marked at around $25.

“So…we get the shirt for a penny, too?” I asked.

The sales lady nodded excitedly at me. “Yep! You guys are so lucky!”

In the end, the four clothing items we bought that day totaled around $13. I might have done a little dance as we walked back to the car.

emma watson dancing

How to find your penny treasure

Unfortunately, there’s no guaranteed secret to finding those sneaky penny clearance items, but I feel like everyone should be aware that it’s a thing. I think a couple of factors helped us snag these deals.

  1. The bralette I bought had a weird top strap that I had to alter once I got home. I think most people just thought it looked silly and left it on the rack.
  2. Joe is tall and has long arms, so he often has trouble finding shirts that fit. The wool one was a bit of a unicorn for him. It’s also wool, and is thicker than a shirt but not as thick as a jacket, which might have made other people less willing to buy it.

If you decide to go hunting for a one-cent Rack bargain, I would recommend scouring the clearance section for anything with multiple red stickers on it, showing it’s been marked down repeatedly.

Keep in mind these might have been left on the rack for a reason. If you’re willing to accept a piece that is a little quirkier or might need some creativity to make it work, you’ll probably be more likely to hit gold.

Obviously, don’t buy things on the speculation that they MAY be a penny. Only buy the item if you’re sure you’ll still want it even if it rings up at its marked price. That way, whether or not you hit the penny jackpot, you’ll still be going home with something you’ll look forward to wearing.

What is an IRA?

When I graduated from college, my dad sat me down and explained that he wanted to help me open up a Roth IRA.

A what-now?

This did not sound like fun.

I figured anything that is named by a bunch of letters is usually complicated and when it comes to money, complicated is scary.

scared boy meets world

Basically me when I first heard the words “IRA”

As he explained what it was and how it worked, though, I started getting a little excited. And when I did my own research, I got a lot excited. Turns out, IRAs, particularly Roth IRAs, are pretty darn cool.

If you’re nervous about finances the way I used to be, it may sound crazy-pants to get excited by something that sounds both boring and confusing.

Fear not. I’m going to walk you through the important basics of IRAs and before you know it, you’ll be able to throw the term “IRA” around like you’ve always known what it means. You MIGHT even get a little excited.

Let’s get started.

What does IRA stand for?

IRA stands for “Individual Retirement Arrangement” although many people just say “Individual Retirement Account” because it makes more sense that way.

What is an IRA?

It’s a retirement account. This means it’s designed for you to put money in it, then invest that money in stocks and bonds, then sell those and take your money out gradually when you retire. Money in your retirement accounts is the money you will live off when you aren’t earning an income anymore.

Where can I open one?

You can open an IRA for yourself without going through an employer. Most brokerage firms, like Vanguard, Fidelity, Charles Schwab, and even E*Trade offer IRAs.

Who can open an IRA?

Anyone, including children, can open and put money into an IRA as long as they earn money somehow. It doesn’t matter whether you have a full-time job or if you babysit or shovel snow as a side gig, you can open an IRA as long as you earned some money and are reporting it to the government. No earned money? No IRA.

Parents can contribute to their child’s IRA as long as the contribution isn’t more than the child earned that year.

How many types of IRA exist?

There are four types of IRA, but we’re going to focus on the main two today: Traditional and Roth IRAs.

The Traditional IRA

The OG IRA.

You can put money into a Traditional IRA before you pay income taxes on it, so you avoid paying taxes on that money right now.

Instead, you pay the taxes when you withdraw the money in retirement. Anything you take out once you reach age 59½ will be taxed like income.

Taking anything out of the IRA before that time will cost you a 10% penalty.

The maximum amount you can put into this account per year (your “contribution“) is $5,500.

**UPDATE: Starting in 2019, the new max is $6,000!

Traditional IRAs are great for when you’re making a really nice salary and are getting closer to retirement.

The Roth IRA

Roth IRAs are the best for young or lower-income people.

Roths allow you to put money into them after you’ve already paid the income tax on it, which means you pay taxes now.

However, all the money you pull out after age 59½ is tax-free, INCLUDING any money you make by investing what you put in (money you make with investments is called “gains“). Income that’s tax-free?! Yes, please.

If you need to, you can take out the money you put into a Roth IRA for free at any time. You CANNOT take out your gains before age 59½ without paying the 10% penalty, but at least you have access to some of the money in the account without having to pay extra. Not that you should ever take money from your retirement account before retirement, but it’s nice to know it’s there.

The maximum amount you can put into this account per year is $5,500.

**UPDATE: Starting in 2019, the new max is $6,000!

Roth IRAs are great for when you aren’t making a ton of money because you pay smaller income taxes now and avoid paying taxes later.

PSST…if this is all a lot to take in, here’s a printable that lists these differences:

The ABCs of IRAs Printable

Which is better?

If you start your IRA early, the chances are good that you will make significant gains on that money, so a Roth is the better choice. Paying taxes on your lower income now will allow you to pull out a nice income during retirement without paying a dime of taxes on it.

As you get closer to retirement, Traditional IRAs often become the better option. The more money you make, the higher your taxes are. Most of us will make more as time goes on, and Traditional IRAs let you avoid paying heavy taxes on some of your income when you’re earning the most.

When you retire, as long as you pull less money out of your account than you used to make, you will pay less in tax than you would have using a Roth.

Confusing? Let’s look at some numbers.

Warning- Math Ahead

Let’s say you make $35,000 at the age of 20.

Using a Traditional IRA

In 2017, you would be expected to pay $4,784 in income tax. That’s not a fun number, so what if you contributed $5,000 of your salary to a Traditional IRA? Your income would now be taxed as if it were $30,000 instead.

That lowers your tax bill to $4,034, saving $750! Nice. If that $5,000 grows at about 5% for the next 30 years, even if you never add anything else to the account, you’d have $21,610 when you were 60 years old.

You could then pull out that money, but you’d have to pay $2,775 in tax when you pulled it out (assuming the tax rates are the same in thirty years!). That brings your total tax paid to about $6,809.

Using a Roth IRA

But let’s say you pay that $4,784 of income tax and then put $5,000 into a Roth IRA. You would make that same $21,610, but wouldn’t have to pay any tax on it when you used it at age 60, so you’d end up paying $2,025 less than you would by using a Traditional IRA.

If you contributed regularly to your IRA, you’d see this play out with much bigger, sexier numbers, but the basic idea is the same. As long as you can, you should contribute to a Roth IRA.

What’s the catch?

These IRA things are starting to sound pretty awesome, right? But, of course, there are some rules that limit how much we can take advantage of that awesomeness.

First, you can only contribute $5,500 per year to your IRAs, total. So, if you have both a Traditional and a Roth IRA, you can put part of that amount, say $2,500, into one, and the rest, $3,000, into the other, but you can’t contribute more than $5,500 between the two.

Also, Roth IRAs have income limits. This means if you make more than $118,000 as an individual, you aren’t allowed to contribute the full $5,500 to a Roth IRA until your income drops below that number again. Once you make more that $133,000, you aren’t allowed to contribute to it at all. Similar rules apply if you are married. For a chart that helps clarify what the income limits are for a Roth, check out Fidelity’s chart.

There are no income limits for a Traditional IRA, though, so if you are lucky enough to be making too much to put money in a Roth, contribute to a Traditional IRA instead.

Lastly, the early-withdrawal penalty I mentioned above can be painful if, for some reason, you HAVE to take money out of an IRA. All the more reason to set up an emergency fund.

Wrap-Up

The Benefits of IRAs

An IRA is a great way to stash away extra money for retirement. If you are already contributing to a work retirement account or if you don’t have an account through work, an IRA can help you stay on track to afford retirement.

Also, the fact that anyone earning income can contribute to an IRA means you can get a jump start on saving before you’re even in a full-time job.

The Potential Pitfalls

Like most retirement-specific accounts, IRAs have rules that punish you if you take money out too early. That doesn’t mean you CAN’T get to that money if you absolutely need it, but you may pay a 10% penalty for taking it out early.

There are exceptions to these rules, especially with a Roth, which is yet another point in its favor, but try to think of money in an IRA as off-limits.

And now you know the basics of an IRA! Congrats on making it through. As a reward, here’s a puppy in a cup!

chihuahua-dog-puppy-cute-39317.jpeg

Now, go open yourself a Roth and start stashing those extra dollars!

 

Disclaimer: None of the companies, apps, or websites mentioned in this article paid me to mention them.

How to start getting your finances together

crazy cat nebula

Does the topic of money make you feel like this? You’re not alone.

Probably the most daunting hurdle in your quest to get smart about your money and build wealth is the very first step: getting started.

Dealing with money can seem scary and feels like a huge chore, so it gets treated like the laundry you don’t really want to do — left in a dark corner until it starts to smell a little.

Ew.

The trouble is that time is one of the most important parts of the wealth equation. Given enough time, even a small amount of money can grow into a tidy sum.

So how do you get started building that little nest egg of yours when you are young, inexperienced, and probably not rolling in cash?

The trick is to keep it simple to start. By taking advantage of 4 types of accounts, you can build yourself a great financial foundation.

The Basic Accounts

Checking

Checking accounts are one of the basic bank account everyone needs. They are usually where your paychecks get deposited and where the payments for credit cards, checks, and even PayPal, Venmo, and other online payment systems come from.

Quick Tip: Look for checking accounts that allow you to pull money from any ATM with no fees or will refund your ATM charges. It’s a nice little perk that you’ll appreciate when you don’t have to hunt down the “right” ATM in a hurry.

Most checking accounts don’t pay interest; you may find one that has an interest rate, but it’ll be really low, so don’t count on your checking account to make you any money. It also shouldn’t be the place you stash your cash for the long term. Keep a comfortable amount in it to pay your bills, but your savings belong somewhere else.

Saving

As boring as it sounds, the best place for your emergency fund or savings you might need soon is in a savings account. Savings accounts can do a lot of what checking accounts can, but, with higher interest rates and no checks or debit cards attached to them, they are designed to be better places for money to sit than checking accounts are.

Not every checking or savings account is alike, however, and I would suggest using a tool like Magnify Money to shop around and find accounts with a decent interest rate and no weird hoops to jump through. Remember, there’s no rule that says your checking and savings accounts have to be with the same bank. Mine aren’t.

Many of the savings accounts with the best interest rates are online-only banks, which means you’ll have to have a checking account to connect to the savings account in order to add or remove money.

Personally, I like the idea that I have to wait a couple days for access to my online savings. The delay makes it really hard to spend that money. However, if you want or need access to your money more immediately, you might want to stick to a checking account or a savings account with a big-name bank that has physical locations. Just know you will be sacrificing interest rate for convenience.

As you get further along in your financial journey, you’ll be able to move some of that cash around and maybe make some more advanced decisions on how to save or invest it, but for your initial emergency fund, I think a savings account is the way to go. Hop over to our post on choosing the right savings account for more help with getting yours set up.

Investing Accounts

Investing is where you can really kick up your wealth-building game. Once you’ve gotten the hang of using your checking and savings accounts, investing is the next step. Without investing, anyone with an average salary is just not going to be ready for retirement.

If you’re a little lost when I say “investing” take a look at our What is investing? article, then pop back!

Retirement Accounts

Everyone needs some kind of retirement account. If you’re lucky enough to have a job that offers a 401(k), that should be your primary retirement account while you’re in that job. Other people might have IRAs, 403(b)s, or another type of account. Many have some combination of these.

Why open a retirement-specific account? Unlike standard savings accounts, these accounts are designed to be ideal places for your retirement savings. By investing your money in a retirement account, you’re likely to see much greater returns than in even the highest-yielding savings account.

Also, if you get on board with a retirement account offered by your employer, you’ll probably also have the opportunity to get some free matching money from that employer.

Even better, contributing to your retirement account often comes with immediate tax benefits, so you could be doing yourself a double favor by saving for your future and getting a tax break. Even those accounts that don’t give you a break on the money you put in usually make up for it with a tax break on the money once you begin to pull it out of the account in retirement.

Every type of retirement account allows you to invest the money you put into it. Some accounts offer more limited options than others, but there’s always a way to help your money grow while you’re just going about your everyday life.

Brokerage Accounts

If you’ve got a full, safely stashed emergency fund AND you’re maxing out your retirement accounts, the next easiest way to invest is through a brokerage account.

Brokerage accounts allow you to buy and sell stocks and bonds. These are TAXABLE accounts, so any gains you get when you sell what’s in them will be taxed as income that year, so be careful. For those of you with money nerves, a couple of low-cost funds and maybe a bond or two are the easiest and least dangerous ways to invest a brokerage account’s money.

The advantages of a brokerage account include the fact that the money in them is pretty liquid, which means you can take it out of the account at any time without penalty, unlike a retirement account. You could think of a brokerage account as like a checking account, except you invest the money instead of keeping it in cash. The danger, of course, is that your investments could lose value and you could end up with less money than you started with. A good rule is to not invest any money that you think you will need in the next couple of years.

I strongly encourage you to learn all you can about how stocks and bonds work before jumping into this pool. It can be rewarding, but it can also be dangerous for anyone who thinks they can game the system and make tons of money on trading. The market doesn’t work that way.

Wrap Up

And there you have it: a basic, 4-account map of how to get started with money.

Can be money be way more complicated? Heck, yes.

Does it have to be? Not if you don’t want it to be.

By keeping things simple with your everyday money in checking and savings, you’ll minimize the effort it takes to track your income and expenses. Taking advantage of your retirement and brokerage investing options guarantees that your future self will have money when he or she needs it.

Quick Tip: Using a platform like Mint or Personal Capital can take the effort out of checking on your finances. After linking all your accounts to the program, you just need to open the app to see how much money you have in each account.

How do you keep your money simple? Share your methods!

 

Disclaimer: None of the companies, apps, or websites mentioned in this article paid me to mention them. I just like ’em!

What is an emergency fund?

This one’s pretty easy.

An emergency fund or “rainy day fund” is any money that you have set aside to use ONLY IN CASE OF EMERGENCY.

The purpose of an emergency fund is to be a safety net in case you have an unexpected bill that would wipe out your checking account.

Experts recommend keeping 3 to 6 months of expenses in your emergency fund. That means enough money to pay your rent or mortgage; essential bills like food, water, gas, and heat; and any other recurring costs like debt payments.

What is an emergency

Losing your job

Probably one of the most stressful things that can happen to most people is the loss of a job. For people living paycheck to paycheck, losing that income can spell disaster for their financial life. Having an emergency fund to keep you afloat while you hunt for a new job can take an incredible amount of pressure off you.

Car repair bills

Cars are expensive, man. When one breaks down on you unexpectedly, you might be faced with a bill totaling hundreds of dollars. If you rely on your car to get to work, that bill needs to be paid right away. Your emergency fund can swoop in and save the day, allowing you to pay that bill and get back on the road with minimum life disruption.

Medical or dental bills

If you, a family member, or a pet get ill or need dental surgery, medical bills can come at you fast. Of course, health and dental insurance will cover some of the costs, but you’ll be responsible for the deductible, at least, which can be thousands of dollars.

 

What is not an emergency

A great sale

Seriously. I know the pull of those great sales at Nordstrom Rack, Target, Sephora, etc. But just because something is on sale does not mean you should buy it. If you were already going to purchase that thing anyway, then get it, but with your normal spending money, not your emergency fund!

Upgrading anything

If it ain’t broke, don’t replace it. That’s the saying right?

Raiding your emergency fund to pay for the newest phone, computer, coffee maker, or whatever just because you want an upgrade is not a good idea. If your current whatever-it-is works fine, keep it until you can truly afford to replace it without weakening your savings.

Keeping your emergency fund in a separate account from your spending money is usually a good move. Keeping it just slightly out of reach will help you pretend it’s not there until you need it. Hopefully you’ll never need it, but you’ll be so glad you have it if you ever do.

How one teen started a business by accident

I tutor students during the week, and I always like to ask a little about what their passions are so I can get to know them a little better. This helps me tailor the lessons a bit, but also gets them comfortable in class.

Last week, I was working through a cost/revenue problem with a high school student and he just casually said “Oh, I get it. It’s kinda like the business I started.”

I’m sorry, but you can’t just say that around me and NOT expect to get quizzed about it. Afterwards, I asked him if I could share his story anonymously on here and he agreed. For the purposes of our story, I’m going to call him Evan.

Evan’s story

The business began with a hobby, which we’re going to say was building models. Evan was part of a group who built models together. At some point, Evan was looking to purchase some materials for his models and went looking online to find them. The cheapest decent items he could find were only sold in bulk from China. The price per unit was too good to pass up, though, so he bought a big old box.

Obviously, he had way more than he needed, so he started selling off the others to members of his hobby group. The next time those other people needed something for their models, they turned to him, and he turned to the internet again.

Soon enough, he was the go-to guy for model-building materials. Already, he had a little business.

What really kicked him into gear, though, was when a friend who attends a nearby university started a model-building club there and hit up Evan to provide gear for the club.

Evan suddenly found himself making enough money that he was able to quit the part-time job he had. He’s now saving money for college and planning how he’s going to move the business online so he doesn’t have to lug the boxes around himself.

Lessons to take away

I love this story for a couple of reasons.

First, Evan is a high schooler, but he’s already learned that he can take the idea of supply and demand and turn it to his advantage. He used his own needs to tell him where there was an opportunity and didn’t think “Oh, I’m a kid, I can’t do that.”

Secondly, when people in his club started asking him for other materials, Evan didn’t just tell them where to buy their own boxes, he took the initiative to order them himself. He saw the demand as opportunity and realized he could use his experience to help his friends AND himself. They still got materials for cheaper than they could otherwise, and he made some money.

Lastly, he is thinking of the future. He’s already done more than many people his age would have with his idea, but he keeps thinking about the next step. He said he plans to to continue the business in college, and he’s going to learn so much about entrepreneurship that I’m kind of envious.

Wrap up

Are you secretly yearning to be an entrepreneur? Take a look around at the stuff you take for granted. What activity or passion do you have that you could monetize?

Whether you sell a physical good like Evan is doing or you sell services like mowing lawns or scooping dog poop, there’s something out there you can try. And for those of you who are applying to college soon, I’ll tell you what I told Evan: taking initiative and putting yourself out there looks killer on a college essay. Go stretch your entrepreneurial muscles!

Need a little side hustle inspiration? Check out Side Hustle Nation’s list of potential side hustles to see if one could be for you. or Penny Hoarder for some ideas.

What is a 401(k)?

Welcome back to our What Is? series of posts. Today, we’ll tackle an exciting topic with a snooze-fest name — the 401(k).

The term 401(k) may look like something out of Algebra class, but it’s actually one the most important perks any job can offer.

More important than free food and a foos-ball table?

Oh yeah.

What is this mysterious number-letter combo and why does it matter so much?

401 huh?

Very simply, a 401(k) is a type of retirement account. Retirement accounts are designed to help you save money while you’re working to live off after you retire.

The name “401(k)” comes from the section of the Internal Revenue Service (IRS) rules that defines the rules for this account.

In 2018, you are allowed to contribute any amount up to $18,500 a year to a 401(k). Starting in 2019, that goes up to $19,000!

What’s the big deal?

These accounts are awesome for several reasons.

Reason #1:

If you sign up for your employer’s 401(k), you can assign a percent of every paycheck to be automatically put into that account. This means that money is safely squirreled away where you’ll never miss it. You’ll be saving with basically no effort on your end.

Reason #2:

Your 401(k) contributions are taken from your salary pre-tax, or before your income taxes are taken out. This lowers your income in the eyes of the IRS, which in turn lowers the amount of money used to calculate your taxes. So, by contributing to your retirement, you could also be saving your current self some moolah in taxes. When you retire and start withdrawing that money from your account, you will have to pay income tax on it, but you won’t be working, so ya know, it’s still not a bad deal.

Reason #3:

Probably the best thing about 401(k) accounts is that employers who offer a 401(k) usually “match” a certain percent of your contribution. What does that mean? If your employer matches up to 3% of your 401(k), that means that the first 3% of your salary you assign to be put into your 401(k) will be doubled by your employer, so you are effectively contributing 6%. That money is in addition to your salary and won’t be taxed until you withdraw it.

Let’s look at some numbers.

Say you earn about $35,000, and you contribute 3% of your salary to your 401(k). That works out to be about $1,050 a year. If your employer matches that 3%, you’ll actually be getting $2,100 a year going into your retirement account.

If you contribute more than 3%, good for you, but your employer will only match that first 3%.

How amazing is that? You’re essentially doubling your retirement contribution by taking advantage of your 401(k) — free money!

free money simpsons

What happens to that money?

When you sign up for a 401(k), you will usually be given a list of funds that you can choose to invest your 401(k) money in. Once you’ve done your research and chosen a fund or two, your money will be invested and will start to work for you, growing even beyond what you are contributing.

Once you reach age 59.5, you will be able to start taking that money out of the 401(k). If you take it out before then, however, you will be hit with a 10% fee, so try to imagine that money as off-limits until retirement.

Other types of accounts

Some professions have retirement plans that are different from a 401(k). If you work for a non-profit or for the government, for example, your retirement accounts will have different names.

Teachers and non-profit employees are often offered a 403(b) plan — named, shockingly, after section 403(b) in the tax code — which allows similar contributions to an account. These accounts work differently from a 401(k), however. We won’t delve into them in this post, but the fees and rules around each type of retirement account can vary significantly, so educate yourself on what those are before signing up for any account.

Can I wait to open my 401(k)?

No. Why would you?

It’s a lot to think about when I’m starting a new job.

Better to get the paperwork out of the way when you’re filling out all the other forms for your job than put it off for some mythical future date when you’ll magically have time.

I’m making so little money! Won’t it be better to wait until I make more?

If you start right away, you’ll never miss the money that comes out of your check, and you’ll be taking advantage of your most valuable asset — time. The longer you give that money time to grow in your account, the more money you’ll end up with down the line.

What if I need every penny?

Even if your starting salary is tiny, try to assign at least a percent or two for retirement. That’s about $200 a year from a $20,000 salary, or $17 a month. You can do this.

Future-you will thank you.

6 Useful Freebies to Save You Cash

Every day, I see about a thousand ads for various subscription services, apps, or other products that sometone thinks I absolutely MUST have in order to be happy.

Some of them are very tempting, with their cute packaging and promises of never having to go to the store again, but I haven’t given in to very many of them (Netflix & Spotify are life, though).

If all of these services had been available when I was just starting out, however, I wonder if I’d have been able to resist those temptations. In case any of you are like me, I thought I’d share some fun and useful services I’ve found that are FREE — everyone’s favorite four-letter word!

free stuff

FREE STUFF!

Spotify & Pandora — Spotify has a free version that allows you to listen a ton of music, but it throws an advertisement in after a few songs. That’s pretty much all you can do, but if you just want to stream some jams, it’s worth checking out.

P.S. : If you’re a student, you might be eligible for Spotify’s student deal. It snags you Spotify Premium and Hulu for $4.99 a month. Five dollars to take care of all your entertainment needs ad-free is pretty good. It’s not free, but pretty close.

Pandora is a bit more like traditional radio than Spotify. It plays songs on stations based on genres, and you can give each song a thumbs up or thumbs down. Pandora will then use your ratings to play more music it thinks you will like. Ads play after every few songs on the free version, just as they do on Spotify.

Podcasts — Podcasts are slowly becoming more mainstream, but so many people still don’t know about them or how to access them. It’s like radio, except everything you listen to is something you like. Cars, languages, horror stories, TV — no matter what you’re into, there’s a podcast for you. You might even find some that will help you with your studies. Not sure how to get started? Here’s what you do:

Step 1: Download a free podcast player from the Apple Store or Google Play — Overcast is popular on iOS and Pocket Casts on Android.

Step 2: Search for podcasts on topics you like.

Step 3: Download or stream them and enjoy!

Netflix — As of this writing, T-Mobile is offering customers who sign up for a family unlimited plan a free Netflix subscription. The subscription is the $9.99/month version, but you can also apply that value to another subscription level and pay the difference through your T-Mobile bill. You have to have more than one line on your plan to qualify, but if it works out for your situation, it sounds like a decent deal. This is absolutely a limited-time-only kind of thing, though.

E-Books — I’m a huge book lover and am a big believer in supporting authors and the industry, but when you’re broke, it’s hard to justify shelling out twenty dollars for a novel. There are a ton of books out there you can grab, legally, for free.

Many out-of-copyright books are free as long as you don’t care about getting the fancy version. (It’s an e-book; it doesn’t need to be fancy!) Project Gutenberg has over 54,000 free e-books. If you’ve been assigned a classic novel or older piece of literature to read, see if you can snag a free online version before shelling out for the paperback.

Jones-ing for something newer? Check out OverDrive. It connects to libraries so you can check out digital or audio versions of books with just your library card number.

Of course, if you have a (FREE) Amazon account, you have a Kindle account, and there are oodles of free e-books in the Kindle store. Just search for free books in the genre you’re interested in. It might take some searching to find the good stuff, though. Because anyone can publish on Amazon, there are some pretty terribly-written books on there, but they are free.

Secret Library Access — Having a library card can open more doors to you than just the library’s. Services such as Lynda.com, which provides access to online software courses, and Ancestry.com, which allows you to research your family history, are free to use through many libraries. Since these sites often charge upwards of $20 a month for access, free use is an amazing deal. Check with your local or school library to see what services might be available to you for $0.

Furniture/Home Goods — Moving into a dorm or new apartment? Don’t go running to buy a bunch of brand new stuff just yet.

Check out the Facebook Marketplace. You’ll see the Marketplace button on the left side of the screen when you open Facebook (in the Menu on mobile). Click that “Free” button with the lightning bolt on it at the top of the page and you’ll see a list of items people are giving away near you. When I checked, I saw coffee tables, beds, and dressers up for grabs, along with wooden pallets, fabric, and other materials just begging to be made into something new.

Good old Craigslist also makes it easy to find free furniture.

Freecycle is a simple forum for people looking to acquire or get rid of all sorts of items. Everything on the site is free. If you’re looking for that special item, try putting up a Wanted post. If you’re just browsing, be prepared to snap up something that looks good!

Of course, whenever you’re getting free stuff from a stranger, be wary of giving out your personal details and never meet him/her alone. The stuff you find may not be the best quality ever, but it will do until you have the money to replace it with something new. I’m still using a dresser I picked up for free years ago, stripped, then repainted. It’s no showpiece, but it holds my clothes just fine.

Wrap Up

So there you have it — a bunch of ways to entertain yourself and maybe save some money on the expenses of living on your own. Students are in a particularly good position because many places provide discounts to people going to school full- or part-time. Always ask!

Whenever you think you just have to drop some cash for this or that, do a little searching first to see if there’s any way to snag that thing for FREE.

Got any secret ways to grab free stuff? Let us know!

Disclaimer: Learn, $ave, Grow has no financial relationship with any of the services or sites mentioned in the above post. Any use of the services mentioned is at your own risk. 

Equi-what? Why the Equifax Breach is a Big Deal for Everyone

You may have heard of the big Equifax breach from your parents, friends, or co-workers.

So what is this mysterious company and why is its data breach a big deal?

Equifax

Remember when we talked about credit scores?

Equifax is one of the three companies that tracks your credit history. The others are TransUnion and Experian. Your credit score is determined by the reports that these agencies create.

Why all the fuss?

There are a couple of things that make this data breach potentially worse than others.

  1. The number of people affected is pretty huge. About 143 million Americans’ information was exposed during the hack. That’s almost HALF of the total US population.
  2. Because Experian tracks people’s credit, it has access to basically every important piece of everyone’s personal financial information. This includes Social Security numbers, credit card numbers, and bank accounts, along with addresses, birthdates and driver’s license numbers. With these details, someone could easily steal your identity and take out loans or make big purchases in your name.

What should I do?

  • Go to experiansecurity2017.com, the ONLY official site to check whether you’ve been affected, and enter your last name and Social Security number. It will inform you whether your information might have been compromised.
  • Even if you are not over 18, it is a good idea to check whether you’ve been affected because children have Social Security numbers, even if they have never held a line of credit. Someone using your SSN could ruin your credit before you ever have a chance to build it.
  • If you have been affected, pull your credit reports from annualcreditreport.com and check them carefully for errors.
  • Also look over statements for any credit cards you have and check for fraudulent purchases.
  • Contact the credit bureaus — all three of them — to freeze your credit. This will temporarily prevent ANYONE from opening a new line of credit in your name, including yourself. If you want to open a new line of credit, like a credit card or loan, before the freeze period ends, you’ll have to unfreeze it. Depending on the state in which you live this may cost $10 – $30, and you may have to pay to unfreeze it, too.
  • Equifax is offering affected customers a free year of credit monitoring. At first, it seemed that signing up for this service would also prevent you from potentially suing Equifax in the future, but the contract has since been amended so that it no longer implies this. Signing up for the service will only freeze your credit from Equifax, so you’ll have to request a freeze from the other two separately. Whether or not to take Equifax up on its offer is definitely a personal call.
  • Be vigilant. Check your credit reports regularly, which you should be doing anyway, and keep an eye out for anything suspicious.

Wrap-up

If any good comes out of this data breach, let it be a reminder to all of us to pay attention to our finances and not let them be “out of sight, out of mind”.