Personal Finance Blog

Tips And Stories To Help You With Managing Money

Preparing For Your Career

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The more education the broader range of jobs which leads to greater earnings.
Higher education leads to greater earnings.
“What are you going to be when you grow up?” It’s the standard question kids get from the time they are able to converse. The answer, though they don’t have any way of knowing it, will make a huge difference in their lives.

Used to be most boys opted for jobs as firemen or star-quality quarterbacks. Girls for a long time were limited to teaching and nursing. Now there are dozens of job options for children of either gender and preparation for them runs the gamut, from high school education through years of graduate work. Likewise, the income they can expect has a wide range. The tales of high school dropouts who made fantastic fortunes are few and far between.

Career Preparation Begins In Elementary School

Experts can reasonably predict how successful a child is going to be based on performance in grades K-12, although, of course, there are exceptions. Many job opportunities are sidelined along the way, placed off-limits to children who don’t see the connection between education and the future in the job market. A serious approach to the foundation years of education will help a child and the support and guidance of parents can make a huge difference. Ideally, however, children should be advised that money is not the only reward for work. Satisfaction in the activity a child chooses to pursue is as important as what they can earn.

The More Education The Greater The Earnings

Logically, a child needs to know that the more education they get, the broader the range of jobs they will qualify for and the greater their earnings will be. If they don’t finish high school, for example, the jobs that are available include such things as waitressing, farm work, fast food preparation, custodial jobs or highway maintenance, will pay from $1,583 to $2,500, according to standard listings.

High School

A high school diploma will generally offer entry into such jobs as bank teller, construction, data entry, child care, military, travel agent and others. The pay range is $2,049 per month to $3,494.

Vocational

A vocational degree (two years or less of post-high school education) in fields such as auto mechanic, cosmetologist, machinist, plumber, welder, etc., increases the range from $2,040 to $3,666.

Associate

A two-year associate degree ups the ante. Jobs such as dental hygienist, office manager, paralegal, nurse or real estate agent are opened up., with pay ranging from $3,205 to $5,759.

Bachelor’s

A bachelor’s degree is required for accountants, teachers, elementary teachers, flight attendants, social workers, marketing managers, news reporters, graphic designers, meteorologists and many other professional jobs. Pay ranges from $3,154 to $7,859.

Master’s

A master’s degree prepares secondary teachers, physical therapists, psychologists, engineers, guidance counselors, librarians and speech pathologists and other specialized fields, with pay from $4,479 to $7,318.

Professional

The step up to a professional degree is required for college professors, dentists, lawyers, optometrists, pharmacists, veterinarians, etc. The pay ranges from $4,500 to $12,645.

Medical

Medical degrees take several years of very expensive training beyond a bachelor’s degree, but the wages are commensurately higher, beginning at an average of $14,500 for a pediatrician to $15,246 for a general practitioner.

There are, obviously, dozens of variables that enter into the equation, but the general truth is that the better, highest-paying jobs go to those who are educationally prepared.

Retirement Planning With Bridge Jobs

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Many elderly are turning to bridge jogs in their retirement.
Many elderly people are turning to bridge jobs in their retirement.
For many Americans, the jump from employment to retirement means getting a bridge job. A bridge job is a bridge between full-time work and retirement for workers who are approaching full retirement but are not quite ready to totally leave the workforce. For some, that interim step can last for years. Retirement is no longer an event, but a process.

Lifestyle Choice

Many workers actively plan for an “old-age” job for many reasons. About 60 percent of aging workers take the bridge job route, according to a University of Minnesota study. And it isn’t just those at the low end of the financial totem pole. Many who look at today’s longevity stats and their relatively better physical condition choose to work awhile longer as a lifestyle choice. A fair number even “come out” of retirement and seek a bridge job. They could get by on their retirement savings, but find life without work doesn’t mean as much. They enjoy the extra income, but view the time filled with useful activity as an even greater bonus.

Erosion Of Retirement Savings

It is now so common that some financial experts look at it as just another job in a lifetime career. Most of those in the workforce now see multiple jobs as part of the standard scenario. The erosion of retirement savings is a factor, as well. Defined-benefit retirement packages are becoming rare and programs such as a company-sponsored 401(k) are taking their places. The move to a 67-year-old retirement target, rather than 60 or 65 amounts to a reduction in benefits, experts point out.

Lower Paying But Flexible

Bridge jobs tend to be lower-paying than the careers the elderly are leaving behind, are less likely to add anything substantial to retirement cushions and may be less strenuous. But the advantages may include more time flexibility, including part-time work.

Rewarding

Some seniors find this as an opportunity to look for jobs in a sector in which they have had an interest, but bypassed during the usual career period in favor of things that paid better. One woman, for instance, went into an education job that was very rewarding to her personally, though it paid much less than her career job. Such teaching or tutoring jobs are very attractive to those whose professional work enhanced their value in an education setting.

Working well beyond what was once considered time to retire is a necessity for some, a welcome change for others. As long as health allows and mental capacities hold up, some opt to keep on keeping on. As one women well into her 90s remarked, “By the time I’m 100, my finances may be in better shape and I can consider retirement by then.”

Paying Too Much For Mobile Phone Service?

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Those staying current with the market find lower prices.
Those staying current with the market find lower prices.
Consumer Reports estimates that 50 to 70 percent of wireless customers pay too much for the service. There are better options, the price oversight publication says.

Check For Promotions

They give the example of Michael McCormack, who has followed the wireless industry for years as part of his job. Since he also is a customer, he was able recently to take advantage of a T-Mobile US Inc. promotion offering four lines for $150 per month.

Make Changes In Service According To Needs

Yeah, but what if your job doesn’t include up-to-the-minute info on such things? The great majority of consumers don’t pay much attention, so they go on paying too much. Some of them are “loyal to a fault,” failing to make changes in their service because they’ve been with provider for a time.

But some 6 percent of the 90,000 responders to a recent Consumer Reports survey said they had changed service in the past year. The savings amounted to about $20 per month, the survey found.

Compare Prices With Other Carriers

The Consumer Reports experts said users should be paying no more than $50 per line, instead of about $100. The carriers aren’t prone to let consumers know how they can save money, said Michael Gikas, senior editor for electronics and technology. T-Mobile started a price war in 2013 and the effects are still being felt. But it’s up to the customer to check on the prices being offered by various carriers and switch when it’s to their advantage. The carriers often offer special prices to customers threatening to make a change.

Customer Satisfaction

Those who are happy with their service are the least likely to change. Others don’t want to go through the hassle of swapping providers, even if they pay more to stay put.

Verizon Communications Inc. has the lowest rate of “churn” or customer defection, in the industry. Company officials say that is because of their focus on quality service and working with customers to guarantee satisfaction. Spokespersons for other carriers emphasized their features, which they believe to be as much as factor in retaining customers. The competition is fierce. T-Mobile has moved customers to lower-priced plans and AT&T has responded to industry price cuts by not only reducing their prices but increasing data allotments.

With this kind of competition, consumers who are willing to stay current with the market are likely to find lower prices.

Angry Patron? Cultivate An Ally

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How to diffuse an angry patron.
How to diffuse an angry patron.
When you are faced with a screaming customer who is not satisfied with the service you have provided, don’t respond in kind, but use the opportunity to improve.

Marc Cosentino, co-owner of Goodfella’s Brick Oven Pizza in Staten Island, N.Y., found himself in that position, dealing with a husband who was very unhappy that Cosentino had hung up on his wife, who was treating the businessman to a tirade because she was not satisfied with his service.

Costenino did the right thing. Instead of escalating the situation with tit-for-tat jabs, he acknowledged that he had been wrong in the first instance. Then they had a level playing field to carry on a rational conversation and come to an agreement. The customer was mollified and ready to patronize the pizza parlor once again.

Joe McCullum, owner of Eagles’ Wings Business Coaching in Hamden, Conn., advises that an in-your-face irate customer really represents an opportunity to win a loyal fan for your business. He gives these tips for defusing a confrontation and turning it around:

Stay Calm

When confronting a situation, stay calm. Make eye contact with the grieved customer and ask what the problem is. You might want to take notes, a signal that you are really interested in knowing the details. Don’t rush things. This may be all it takes to set the scene for rational discussion. Most people aren’t used to having their consternation acknowledged. Don’t head for a back room to address the confrontation. That lets him or her know you are willing to face the complaint and try to work it out. Other customers may actually be impressed. The reputation will last longer than the incident.

Don’t Become Defensive

That will only escalate the irate customer’s frustration. If there is a misunderstanding, wait for a calmer moment to present your viewpoint. Acknowledging that you might be angry if you had found yourself in a similar situation may help.

Apologize

Apologize for the event and express thanks to the individual for bringing unsatisfactory service to your attention. Ask how it can be corrected and make a sincere effort to work out a solution together. Get the person’s contact information and do a follow-up to ensure that the problem was satisfactorily resolved.

Making the effort could ensure a loyal customer who is more than ever ready to bring you his business.

How Safe Is Your Pension?

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How to know if your pension is safe.
How to know if your pension is safe. Is your pension safe?
For years, you worked hard on the assumption that when you were ready for retirement, a company pension would finance the final years of your life. It was a comforting cushion.

Now imagine that the cushion has disappeared. Your employer regrets to inform you that there has been a mistake and the amount of your pension is being drastically cut. It has happened frequently enough lately that it isn’t possible to ignore.

For instance, one Hawaiian man was informed by his former employer that he had been overpaid by $97,000 over a period of twenty years. The company wanted $66,000 back, please. The 65-year-old found his pension reduced from $1,300 per month to $800.

Changes in pension policy

The example is not without precedent. Huge changes in pension policy have left thousands of retirees blindsided and wondering what to do next, according to an AARP magazine article. Bankrupt cities such as Detroit are targeting pension plans in an effort to stay afloat. Private companies are selling off obligations in the form of annuities, freezing or under funding their pension plans or shifting their employees to 401(k)s, Traditional pension plans now go to only 16 percent of the country’s workers. That’s about half of the 35 percent in the early 1900s who put their faith in pensions to finance their retirement.

Recent federal legislation that allows some financially beset companies to cut benefits to former employees under age 80 has exacerbated the situation. A growing number of retirees find themselves with less to live on as their pensions are trimmed.

Some financial experts predict the demise of the traditional pension program in the United States. The congressional edict shifts the burden from the employers to those least able to afford it – retirees or their surviving spouses, according to the Pension Rights Center, which fought the legislation.

Multi-employer plans, which were created to provide a pool for pension plans for companies, primarily those dealing with unionized workers, are feeling the changes. Reduced union membership and market declines have created problems for at least 150 to 200 of those plans. Some are expected to run out of money within 20 years. A complex process for modifying benefits will protect workers for some time, but cuts are likely over time.

The legislation could leave millions of Americans with their retirement plans in shambles. The Hawaiian resident, who worked as a sheet metal worker in Chicago, found himself the unwitting victim of his company’s sloppy handling of its pension program. Over a thirty-year period, the company overpaid retirees (he was one of 588 affected) more than $5.2 million. Even a decade after the whopping error was discovered, steps hadn’t been taken to rectify the problem, hence the shock of learning that he was expected to help repay the over payments, with 7.25 percent interest tacked on.

An even more painful cut occurred when a South Carolina retiree’s monthly pension check dropped from $1,414 to just $5. His former employer’s reasoning: it had overpaid him by more than $263,000. They argued that disability payments the man had received should have offset much of the retirement payment. As an employee of the New York transit system, he had suffered serious injuries, including a bullet in the head and stab wounds in the chest, in encounters with thugs while working.

How retirees can protect themselves

These examples are not the only ones being reported in the country. In both the private and public sectors, pension problems are manifold. Attempting to recoup disputed pensions is now one of the leading tasks of some legal agencies. Local laws related to pension errors are not consistent, so recovery is unpredictable.

Retirees are advised to protect themselves by asking to see the calculations that figured the amount of their pension. If you are unclear on your situation or feel you need help in understanding your rights, contact the Labor Department at dol.gov or call, toll-free, 866-444-3272, If you are still working, file relevant materials such as W-2 forms and pay stubs. Also keep documents related to pension plans, including a plan description, benefit statements and notices you are sent.