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- [00:00]
Jill
This is an iHeart podcast.
- [00:05]
Sponsor
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- [01:41]
Jen
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- [02:46]
Jen
What to do if you have nothing saved for retirement?
- [02:53]
Jill
Welcome to the Frugal Friends podcast where.
- [02:56]
Jen
You'Ll learn to save money Embrace simplicity.
- [03:00]
Jill
And live a richer life.
- [03:03]
Sponsor
Here are your hosts, Jen and Jill.
- [03:09]
Jen
Welcome to the Frugal Friends podcast. My name is Jen.
- [03:12]
Jill
My name is Jill.
- [03:13]
Jen
And today we are airing an episode that we originally recorded in March of 2023, but it was a top episode of that year.
- [03:23]
You guys loved it.
- [03:24]
And we're going to replay it because we want to make sure you get.
- [03:28]
All of our greatest hits, that you.
- [03:30]
Do not miss one of them.
- [03:32]
Jill
We know y' all aren't going into the archive that deep. And if you've been with us long enough that you heard this episode two years ago, over two years ago. Yeah. You're ready to hear it again.
- [03:44]
Jen
You a real one.
- [03:45]
Jill
You're a real one and you're ready for it.
- [03:47]
Jen
Yeah.
- [03:48]
Jill
But first, this episode is brought to you by Seeing is Believing. For all you skeptics out there, cynics who aren't sure if we're AI or not because we sound so stinking flawless, you can see us and know that we exist on our YouTube channel. You still won't be sure if it's a deep fake or not because you know, we sound flawless. Look, flawless are flawless. I can't even go to our YouTube. Frugal friends on YouTube.
- [04:20]
Jen
Yes.
- [04:20]
Jill
And subscribe, please don't skip that step.
- [04:23]
Jen
Yeah.
- [04:24]
Jill
If you make it to our channel on YouTube, please click that button if you. It helps us so, so, so, so, so much. Even if you aren't a big YouTube person, you prefer podcasts. At least do us this solid. See us and believe us and then support us and subscribe. And if you are liking it and you like some of the content that we're putting out that is different than what's here on the podcast. Like it. And comment and engage with us there because we, we write back, we will.
- [04:54]
Jen
Answer you, let us know how unflaw. Like someone just recently on one of our shorts said, Jill, I like the way you talk. And it was a video of both Jill and me. So then I responded, Jill says thanks from Jen.
- [05:17]
Jill
I'm actually curious. Let's look that up at the end of this episode if they ended up responding to you.
- [05:23]
Jen
But please, yes, subscribe to the channel because every time you do, YouTube will push our channel and our videos out to two people who've never heard of Frugal Friends. And they too will get to learn about values based spending and being a more empowered financial adult.
- [05:40]
Jill
So your one action can impact and influence two other people positively.
- [05:45]
Jen
Yeah.
- [05:46]
Jill
Which is. I love that ripple effect.
- [05:48]
Jen
Yeah.
- [05:48]
Just like when we originally recorded this episode and it has impacted people two years ago and it will impact more people. I don't think that's the butterfly effect, but that is a trend that's going on in social media and I've seen it used incorrectly a lot, so I kind of want to use it incorrectly now. But yeah, so it can be really stressful if you don't have anything saved for retirement. And I think before we go into this episode, I just want to reiterate the main message of it is that it's never too late to start and nothing is too small to start because time in the market beats timing the market and putting more, greater sums for less time in the market. So don't wait. Use this as inspiration and motivation to.
- [06:41]
Get started today with whatever you have.
- [06:44]
So I want to make that clear right off the bat and you'll hear that reiterated through the episode.
- [06:52]
Jill
All right, let's get into it.
- [06:57]
Jen
Let us get into this first article on what happens when you don't save for retirement from one of my favorite websites, Investopedia.
- [07:08]
Jill
A cautionary tale. There were a lot of options that we could have gone with on the Internet. When you look up what's going to happen to me if I don't save for retirement search, we went with the not as harsh of an article with Investopedia and some helpful cautionary tales for us of what we could be looking at not being too doom and gloom either. I mean, there is just a reality to this and even the best laid plans could lead to some shifts that need to happen in retirement. So I kind of walk away with this with some level of encouragement of like, okay, it can get figured out even if you start later in life, even if you don't have any savings right now. But to be able to look at the reality of, okay, this is what my life, my financial situation might look like if I don't save for retirement and is this the reality that I want for myself or are there shifts I can be making? So it, I think is worth going through. What they're listing out in this article is what happens for people who don't save for retirement just to have an understanding, to kind of put some motivation or fire under us to say, yeah, let's make some shifts, let's do some things right now. Because I think many of us need to hear that. I think for many of us, what do they say? Almost half of Americans don't have a retirement savings. So chances are that's a lot of us listening in. Or if we do have retirement savings or investment accounts. Maybe we're not doing the most that we could be with them. So the first thing that they list of what can happen is that we might solely live on Social Security if we don't have any savings or investment accounts for retirement. A lot of times that means people's plans are to live on Social Security. What it means is they need to find a way to live off of Social Security. But the thing about Social Security is that it's usually about 40% of the income that you typically were used to making. It's like 40%. And there's definitely ways to maximize how much much you take out of Social Security. Those who are close to this stage of life know what that is. You know, the age that you start pulling from Social Security. But essentially Social Security is best as an additional income, like an additional piece of money that comes in, not what you could solely live off of. It usually represents not enough to pay for your mortgage if you still have it, bills, even if want to do some fun things in your retirement age. It's not a great plan. But that is what most people will then try to lean on and fall back on.
- [10:04]
Jen
Yeah, you're going to have to plan to start withdrawing as late as possible. So when you are 70, I think it is, you're going to want to plan to do it then. But again, we've talked about this before, is that the average age Americans say they want to retire is 67, and the average retirement age is 63. But you're going to have to plan to work till 70. But you don't know if you're going to make it there. So you still need to do other things to supplement that. So they recommend you might need to downsize your lifestyle, which is 100%. Most people do this anyway, even if they have saved. So this I feel is maybe a redundant recommendation, but downsizing your home into something smaller, which can be just fantastic anyway if you don't have a bunch of children running around and then maybe going down to a smaller car that takes less gas, that is more reliable, and then just kind of downsizing all of the subscriptions and all of that thing. So if you haven't thought about all of those, because everyone kind of thinks about downsizing their home, but there's a lot of other things to downsize. Definitely go get our spending makeover frugalfriendspodcast.com makeover because we're going to give you space and guidance on how to take an inventory of all those things and Then from there figure out what you.
- [11:48]
Jill
Can downsize, which, yeah, again, that that could be possible for anyone in retirement, but it's not so great when that's not what you wanted to do, or you need to downsize as a result of not having saved, or you need to cut things that you wouldn't have otherwise wanted to cut just to make it work. So while there's kind of two sides, I think to look at that downsizing piece of, yeah, plan for it, that can be great. It's a great kind of frugal solution. But it is a reason to be investing for retirement. Because if you're forced to downsize as a result of not having prepared, that can be a really, really tough reality for many.
- [12:30]
Jen
And we hope if you're listening to this, you still have a little bit of time to save. But chances are if this is the episode you chose to listen to, like you just searched it, then, then these are realities for you already. Like this first article. These tips are already realities for you. You're going to have to pursue them. If you're a regular Frugal Friends listener just tuning in, we hope that you've already kind of taken some steps and you're hearing this early enough to know that these are the stakes you're working with. So these are the things that are going to be at stake if you don't ramp up to the amount of investing that you need.
- [13:08]
Jill
They also list that it might be necessary to take on a roommate if you still own a home. Many seniors, those in retirement age, will turn to their homes as a source of income. That could mean renting out a portion of their space as a separate apartment. It could mean just an actual other roommate in the home. I would even add that I've seen many times older adults needing to move in with their adult children. And that's another version of having a roommate if you don't have enough saved or invested for retirement. Housing is one of our biggest expenses that doesn't stop when we enter into retirement. And so living with somebody else is often a way that those who don't have enough money save will turn to to be able to pay the other bills that they have. So again, if this is not something that you want to be looking at in retirement age, then okay, cautionary tale. Otherwise, then yeah, you could use it as a tip. Move in with your adult kids or take on a roommate. But if that's not something you want, that could be a bitter pill to swallow of, okay, I have to share my space now. After all my decades of living life, I now have to learn how to have a roommate to be able to afford life.
- [14:29]
Jen
And if you listen to episode 285 where we talked about how your parents finances affect you, and you're listening to this and you're like, oh my goodness, my parents don't have anything saved for retirement and this is what they're dealing with. This is a good moment to prepare yourself that this may happen to you even though you have time to save for retirement. That's another reason people retire earlier than they want to is because they become caregivers for their parents. So it's definitely a stake not just in your saving for your retirement, but. And if you don't want to do this to your children, if you don't want to be forced to move in with your children, this is a stake that you have to be really aware of is to save enough so that you don't have to force them to retire before they're ready.
- [15:22]
Jill
I don't know. I say that's a reason to have kids.
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Jen
I mean it absolutely is a reason to have kids. They owe you. You provided for them in their time of need and they owe you provision in your time of need.
- [15:36]
Jill
That's why I'm identifying one to two of my nieces and nephews to really invest in their lives so that later on they'll take care of me. Yeah, I don't have any kids of my own, so one or two of my nieces or nephews better pan out for us.
- [15:52]
Jen
I hope you're not thinking Jack's gonna do it, the four year old.
- [15:56]
Jill
It will not be Jack. It's not the 4 year old who growls at people. He's not gonna care for me.
- [16:03]
Jen
Who literally growled at my son yesterday. And I thought he was just making monster truck noises.
- [16:10]
Jill
No, that would be what you would think as like the mom of a very sweet boy. Like they're making monster truck noises. But Jack was not. He was growling, he was being a monster.
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Jen
So there's.
- [16:24]
He was a very nice monster though. I totally understood an appreciation.
- [16:28]
Jill
Very big difference between a monster and a monster truck.
- [16:31]
Jen
Yes. All right, so the next one is you might have to continue working part time, which is actually something a lot of people in retirement do just for fun. But you're going to have to plan to do it for supplementation of the Social Security income. So I think it is wise at this point to start thinking about what kind of part time work you'd like to do after retirement, whether it's consulting in your industry or taking on a part time role at the same company or a different field, maybe you hone your skills in some kind of parallel field so that you can work part time. It is never too early to start thinking about this so that when you do have to work part time in retirement, it's something that you at least can semi enjoy. So we don't want to like be miserable, we don't want you to be miserable and we're not going to tell you to be miserable in retirement just because you have to do some things differently.
- [17:36]
Jill
And the final reality that they mention in this article is that for some retirement might not even be on the table. Many people who have not saved or invested enough for retirement or maybe aren't willing to completely overhaul their lifestyle, then it just might not be an option to really scale back in working. And they might need to continue to work full time and as long as possible. If there's not enough saved, which is that can be fine. And many people choose to continue working just because they prefer that lifestyle and want to set their hands to something. The pinch can come when your life circumstances demand something different, like needing to care for anyone in the family, an elderly parent, a spouse, an adult child. Who knows, there could be things that require caregiving of us or our own medical concerns that would keep us from working full time. So there are those other additional pieces that need to be considered and I think just the bottom line that they are driving home here is that that retirement without a plan, without some financial nest egg will require a lot of sacrifices, a lot of overhauling, revamping, problem solving, and potentially just not being able to have the lifestyle that you may have hoped for in your later years. Your golden years.
- [19:06]
Jen
Yes, and they can still be golden.
- [19:10]
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Jen
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Jill
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Jill
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Jen
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- [21:19]
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- [21:49]
Jen
So we've talked about what the majority of retirement would look like if you are starting very late, have nothing saved. And when we say very late, we're talking about like 50. If you want to retire in your 60s and you have nothing saved in your 50s, that's kind of what we're saying. If you're in your 40s, you might feel like you're starting late, but you actually have a really good time horizon. So starting now can still get you to a really good place. Obviously not any of those sexy projections people talk about when people start in their 20s. But I mean, how many people really start investing in their twenties? There are some accidental. So yeah, we did start investing in our 20s, but most of the time it's an accidental, like you're automatically signed up for your 401k. So our next article is from the Balance and it's seven tips for saving for retirement. If you started late in life. And so when we're looking at investing, if you're starting, say in your 50s and you want to retire in your 60s or 70, we're going to look at it different. We're not going to look at this money as a way to carry you through your full retirement. The first article, those tips are going to kind of really carry you through retirement, but you are not absolved from saving and investing for retirement because probably in the last five years of your life, all of that is going to change. You're not going to be able to have a roommate or live with your kids. You'll probably need some really assisted, heavy assisted living care. You're gonna have more medical bills. You're not going to be able to work even part time. So, and this is sounds very sad, but this is kind of how to prepare. Like your investing and your savings later in life can be put towards those last 5ish years. That's kind of how you want to look at it. And if you're starting at 50 and you're maybe investing from 50 to 55 and you invest nothing else for the rest of your life and you don't use that money until you're, gosh, worst case scenario, 75, probably 80, that money still has 20 or 25 years to grow in compound interest and that your money usually doubles around every 10 years. So it can still make a lot of growth. If this is the way we're looking.
- [24:26]
Jill
At it, that is encouraging.
- [24:27]
Jen
Yeah.
- [24:29]
Jill
Worst case scenario, isn't that that bad?
- [24:31]
Jen
Yeah. So if you are, you know, closer to retirement and you're like, it's just too late to start investing, it's not. And it's really a necessity that you should be doing so that you have the quality of life that you want and it's less of a burden to any of your familial caretakers later on. So that's really what this. I think we want to have that mindset going into this article.
- [25:00]
Jill
Yeah. So this one comes from the balance and it goes through different things that can be done if we feel like we're starting later in life. They are identifying 40 as that later in life age. A lot of the examples that they give are 40. But a lot of these tips apply even if you're older. So the first one is to play catch up. So you are legally allowed to save 19,500 in a 401k retirement plan. This was in 2021, so not, not too much different. Now after you turn 50, you can contribute additional amounts, $6,500 and catch up contributions. That's not a ton, but we might as well be taking advantage of those things if that is the age bracket that we find ourselves in.
- [25:49]
Jen
Yeah, anything that has a limit has a limit for a reason because it's really good for consumers and not.
- [25:58]
Jill
The.
- [25:58]
Jen
IRS or the government. And so we want to take full advantage of anything that has a limit. And that includes a 401k or if you are not currently offered a 401k, then an IRA or both if you have the funds to. The next is to identify how much savings you need. So this one probably should be first, but here we are. So. So again you might tell yourself you don't need a million dollars or that you want a simple life, which I think is what most of us do tell ourselves. And if you're starting later in life, you probably won't get to a million dollars. So there you go. But in 25 years you're going to see a lot of inflation. I think if you think back 25 years, gosh, if you think about back two years ago and how much inflation that we've seen like in the 80s with that inflation and just over time, a million dollars is this like arbitrary number that we think of as a lot, but is becoming like less and less. So if you're thinking about it with that mindset, don't think more money means like, you know, is for more like bougie people. I think we all need to be investing and saving as much as we can, as much as our incomes and expenses allow. And if you get to a million, cool, you'll probably need it. If you don't, cool, we'll figure other stuff out. But you do need to identify how much that is. And most experts agree that you should withdraw no more than 3 to 4% of your retirement portfolio each year. I think most people will say about 4% of your retirement portfolio. Again, if you're starting later in life life, you're probably going to be saving and then just kind of taking it out in big swoops near the end of your life. I probably would not plan to take out 4% every year, unless you've been saving for a long time and you have that nest egg. So that's, that's kind of. But so if you have a nest egg, if you're starting in time to build that, then plan to do about 4% of it. So if you do the math, 3% of 1 million is 30,000 and 4% of a million is 40,000. So if you're planning on living on $40,000 a year in retirement, then you do need a million dollars.
- [28:39]
Jill
And they do reference that. That's assuming it's not accounting for a pension, rental properties, or potentially other sources of income during retirement, Social Security. So that could be enough if you are living modestly and you have some of these sources of income. But it really is eye opening. Like this is the amount of money that needs to be saved even to live modestly into retirement. And of course that depends on how long you're living. That depends on the value of the dollar at that point in life. And so if we're decades away from retirement, then for us it probably is more than even that 1 million that we want to be aiming at.
- [29:20]
Jen
Yeah, but definitely at least take into considerations the tips from the first article and how much that will net you and think of an ideal gap and whatever that is. Just try to shoot for that gap at least whether it's a couple, couple hundred thousand dollars, you know, 750,000, whatever you can do, shoot for it.
- [29:43]
Jill
The next tip in here for those of us who might be starting a little bit later, is to not take on more risk than what you are able to. And really that's dictated by our age. People in their 20s can accept greater losses, so their investment can be a little riskier versus people in their 40s can accept less risk and still less for people in their 50s. So being aware of the level of risk that's in your investment portfolios, they give a couple of different asset allocation formulas that could be implemented and utilized. A few of them include one being invest A percentage of 120 minus your age instead stock funds with the rest going into bond funds. This represents a higher but acceptable level of risk. Even more moderate risk would be investing A percentage of 110 minus your age in stock funds with the rest in bond funds. And then finally, a much more conservative level of risk would be investing the percentage equivalent to your age in bond funds with the rest going into stock funds. That can be a helpful formula. Obviously do well, what's, what's going to make sense for you. Just know that less Risk the older you get is the ultimate formula.
- [31:04]
Jen
But honestly, if that confused you, a target date fund is going to self allocate. It's going to do it for you in the percentages and grow in conservatism the closer you get to retirement. So typically they say if you are going to choose, choose the date where you're going to retire. So if I'm going to retire at sometime between the age of 65 and 70, because the target dates, there's not one for every year, they go every five years. So just whatever year is sometime between when you turn 65 and 70, choose that one. That's if you're using it long term. If you're not, if you're going to wait to pull any money out until later in retirement, then choose the one that is within the year, the five years that you're going to start. You think you'll start pulling it out. So if you want to wait until 80 to start pulling it out, then whatever date is between whatever five year period is when you turn 80, I choose the later one because they do tend to run more conservative the later you get to them. So that's how if you like, if you turn 80 in 2053 and you want to, you know, just do a target date fund, then the target date fund for 2050 or 2055 is going to be for you. I would, I am in 2055. That's not when I turn 80. But so, so yeah, target date fund, it will, it will allocate in a really standard way and it will self rebalance and you don't have to worry about it. And it's got, you know, if you go with a Vanguard or Fidelity or a Schwab, really low fees. So you don't need to worry about it.
- [33:05]
Jill
Simplicity and maintaining. It's not about timing the market and keeping a pulse on it and checking what's happening every day. It's just making a decision one day. Setting up automatic payments to that and maintaining it.
- [33:21]
Jen
Yes, that's it.
- [33:22]
Jill
And then thanking yourself later.
- [33:24]
Jen
And then remember like my husband was in a target date fund and beat my, you know, quote unquote optimized fund still. I mean, just by 1%.
- [33:35]
Jill
Yeah, but so well done still.
- [33:37]
Jen
And neither of us lost money overall and even in the worst five years of investing in our lives.
- [33:48]
Jill
So.
- [33:48]
Jen
Yeah, and that's just been five years. And if we let it, if we let that money sit 20 years, then it will grow more. I believe you can't predict the stock market, but I mean, over its history it goes up and to the right and that's what we hope will continue to happen at least in the next 20, 30 years.
- [34:10]
Jill
Who knows after that?
- [34:11]
Jen
Who knows after that? But hopefully that's all you're gonna need to know. So the next one is to open a Roth IRA to save more. So it says once you're finished maxing out your 401k to open an IRA and maximize that, I would say everyone needs to have a Roth IRA or at least some IRA because a lot of us don't have 401ks or 403bs etc etc available. About 40% of people don't have them available. And even some of the ones that do have horrible options and don't need the tax benefits like immediately. So while 401ks are fantastic, they're way better than a brokerage for most people. Even if you don't need the immediate tax benefits, still having a Roth IRA if you're eligible is great because that's got tax benefits down the road. So most people aren't going to be able to max out both. Especially when you get to the age where you can do catch up contributions on both. If you can, that's great. I would ask you why haven't you been doing that the whole time? But I digress. Do what you can. Hedge your bets. Even if you want to do half in a pre tax and half in a post tax, which is, is, which would be half in a 401k, half in a Roth IRA, do that. It's really up to you. There's, I mean for us in for what the purpose of this episode is like we don't, we don't have a recommendation on that. That's really up to you how you do it. But I mean if you, if you're maxing out a 401k, okay, open a Roth IRA. But if you're not maxing out a 401k, open a Roth IRA anyway.
- [36:05]
Jill
Just do it.
- [36:06]
Jen
If you're eligible. Just do it.
- [36:08]
Jill
The next on here is telling us to buy adequate insurance, stating that most personal bankruptcies are caused by unexpected calamity. And isn't that just the case? We don't know what's going to happen in retirement.
- [36:23]
Jen
If you could expect calamity, would it be calamity?
- [36:28]
Jill
Right? I think that that's so, I mean that's, that's an emergency fund. That is what savings is for. We don't, we don't know what's going to happen in retirement. I think it's good to plan for the worst while not dwelling on the possibilities of the worst. But we won't be so shocked by things if we have a contingency plan. If we've thought about it and we've put some things into action, it really reduces the feeling of something being a calamity.
- [36:56]
Jen
Yeah.
- [36:57]
Jill
So we can do this by buying adequate health insurance, disability insurance, I mean car insurance. I think you have to have car insurance to be driving on the road. Most places. Most places, okay. And these things are really going to help, especially if we've got dependents being able to have life insurance set up. So these things can help us and be prepared for those calamities.
- [37:23]
Jen
Insurance is another one. We're not going to be able to tell you how much or what to do because it is so per person. This is where the five years before you retire, or you want to, before you want to start withdrawing, retiring, whatever feels good to you. It is really useful to get a financial planner, a certified financial planner that has the CFP designation because when you find a cfp, they're going to have a fiduciary duty, which is a legal, ethical responsibility to you, not to the company they work for. Because you'll find a lot of financial planners and financial advisors from insurance agencies and their best interest is to sell you insurance policies as retirement policy as retirement accounts. You're going to find a lot of money managers working for investments that are. Their best interest is to sell you on a particular fund of investments. So you want somebody, especially in the five years before you retire, who's really going to be working in your best interest. You will pay them for that. If you're getting advice for free, know that you're paying for it in other ways, but you want to pay for advice. And they're going to tell you this is the type of insurance you need. Because if you're starting later in life with saving for retirement, you'll probably need more insurance than somebody who is not. And so that CFP is going to tell you kind of how to hedge your bets in pre and post tax investing. They're going to guide you on insurance. These are the things where like we get emails about this and we're like, we can't answer this for you. And even if I, even if I had more information about you, I would not answer this for you because I don't hold the cfp. I don't hold any, you know, licenses to do that. So take some savings, take some money, pay for a certified financial planner. To tell you what these things are for you. The next one we can tell you, we can give you all the advice on this one is to pay down debt. And we're talking about high interest debt, high interest car loans, high interest non mortgage debt. These are the things you're going to want to focus on. You may want to pay off your mortgage before retirement, but if you have nothing invested, a paid off house isn't going to buy you food in retirement, that's going to be money. So you're going to need to really be careful with how much debt you pay off. Even though yeah, you'd like to, I'm sure be debt free in retirement, that would be a huge weight lifted. But if you have nothing invested, that may not be a wise dream. But paying down high interest debt, pretty much anything. I would say definitely above 10%, ideally above 5 if you can do it. Those are the things to focus on.
- [40:44]
Jill
Yeesh. And lastly, I love this one. You and your spouse come first. So this is a really helpful thing because emotional emotions come into play with spending and especially I think, yeah, as so you have kids and grandkids. But reality is we don't want to ruin our retirement savings and investing plan if that like by sending kids to college. I know this sounds like a really tough truth here, but it would be better for if you have to choose between one or the other. Right? Obviously, if you can do both, fantastic. Keep contributing to your savings account accounts and send your kids to college. But at the end of the day, it's going to be better for you and your children if you continue to contribute to and focus on your retirement savings plan than to send your kids to college. Because ultimately if you trash your retirement savings, by not trash, I mean that's what the article says. It's the word the article uses. But if you kind of interrupt intersect that retirement savings savings plan and maybe even pull money out of it to give to your children, that's then setting yourself up to not be in a great place come retirement. It may put extra financial burden onto the children to be paying for you in retirement or somehow financially responsible for you. When your children have more time to be able to save for themselves in retirement, they've got the opportunity in their 20s and 30s to be saving for that retirement. They've got the rest of their life lives ahead of them versus you who might be starting later in life, really need to be focusing on that retirement versus giving all the money to the children.
- [42:35]
Jen
Yeah. Here's a really easy way to make this Decision. Ask your teenager or if your kids are older, just ask them now if they in their adult lives would rather you pay for their college now or if they would rather take care of you part time to full time in their home in. Yeah. In your later years. Ask them which one they would rather do and you're gonna get the most honest answer from a teenager. But I mean, that's really what it is. You're either paying for their college now or they're going to spend their time or money taking care of you later in life. And so ask them what they want to do. Maybe they do want to take care of you in your older years and in which case, cool. Factor that in. But I think most of the time they're gonna say, I'll take out a student loan.
- [43:28]
Jill
The best gift you can give your children is your own financial retirement security.
- [43:36]
Jen
That's a line in the article that she just sang.
- [43:38]
Jill
Yeah, like a jingle. Yeah, it's a jingle now. It's the best gift you can give to your children. And I agree.
- [43:45]
Jen
Yeah. And their in their 40s and 50s.
- [43:49]
Jill
Freedom as an adult child. I couldn't agree more.
- [43:54]
Jen
Absolutely. As an adult child. Who knows? I will be a caregiver in my 40s, 50s. I will just leave that out there.
- [44:06]
Jill
Wish you had received the best gift.
- [44:08]
Jen
I wish somebody had asked me.
- [44:09]
Jill
A teenager giving that gift to your children. You know what the best gift is that we can give to our listeners?
- [44:17]
Jen
Yeah. And I'm going to ask you as a teenager or as a full grown adult. But I'm only going to take your answer right now.
- [44:25]
Jill
The bill of the week.
- [44:37]
Sponsor
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- [44:47]
Jill
Maybe your car died and you're happy.
- [44:49]
Sponsor
To not have to pay that bill anymore.
- [44:51]
Duck Bills, Buffalo Bills.
- [44:53]
Bill Clinton.
- [44:54]
This is the bill of the week.
- [44:57]
Hi Jen. Love your podcast. So I actually have a couple bills of the week. One is the bill for the remaining car payment on one of our vehicles as well as the balance for the birth center for my son. We actually refinanced those and was able to lower what was a 10% APR and an 18% APR to just around 8%. The second bill is the remaining balance for the birth center. Kids are expensive. Love them to pieces though. I paid it on our children credit card and they have the mychase plan. So we're able to, for a small fee be able to pay it over a portion of time versus leaving it outstanding with the provider and having to incur severe interest costs by having the balance just hanging out on the credit card and actually a third bill, anything else that we have from a medical standpoint, I've contacted the providers and asks that we get set up on a payment plan and I'm able to use my hsa. So again, it's not something that we're having to incur on our credit cards or anything like that. So a lot of moving wheels, but feel really good about the ways that we have to take care of those without going into severe medical debt. So again, love you guys. Thanks.
- [46:24]
Jen
That's great. Lowering the interest rate 18 is very, very high and 8 definitely more manageable. So that's amazing and I hope everybody checks out. We have an episode with Dr. Virgie on negotiating medical bills. I will find that episode. Tell you what it is.
- [46:46]
Jill
You are moving and shaking over there, which is awesome. Congratulations on the birth of your child. That is so exciting. And the fact that you have a health savings account, you're able to utilize that. I think just what stands out to me in your multiple bills is just kind of knowing the resources that are available to you, implementing, utilizing them and making some really wise decisions with your finances to get rid of some of this debt. Lowering these interest rates, really, really awesome. And hoping with you that all of these payments get paid off quickly. That'll be a great feeling.
- [47:23]
Jen
Yes.
- [47:24]
Jill
If you all listening, have a bill that you want to submit. If it has to do with moving and shaking, giving birth, or just out there being a bill, being a person named Bill, visit frugalfriendspodcast.com Bill leave us your bill.
- [47:41]
Jen
Yes. And episode 230, that's the one negotiating medical debt.
- [47:47]
Jill
Episode 230. Check it out. That's a great one.
- [47:50]
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- [48:20]
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Jill
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Jen
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Jill
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Jill
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Jill
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Jill
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- [49:52]
Jill
And now it's time for the lightning round.
- [50:00]
Jen
Pew. All right, so today, what is your biggest worry about retirement?
- [50:09]
Jill
Jill, I've thought about this quite a bit, and I think it comes from seeing what many people face in retirement, and that is just unforeseen medical issues and concerns. I guess I'm anticipating it, so maybe I'm kind of seeing it but not knowing exactly what it would be or look like. Some of that's unavoidable, but I think it's leading to a lot of different potential decisions for me. Like the reality that retirement could mean caregiving. It could mean me being chronically ill or facing some sort of difficulty physically. Medically, though, that has a financial impact, but I think also an emotional, mental, relational impact that holds concern for me. I mean, I don't want to spend a ton of time thinking about that or considering that, but definitely preparing for it. I think in some ways, it makes me consider, what are the things I want to do in life now. I have seen a lot of people hope for big travel, lots of excitement in their retirement years, only to experience a different reality. Oftentimes, no fault of their own. Just life interrupts, and that's not possible anymore. So it definitely leads me to think, how can I live life to the fullest now while I Maintain a level of health, but then prepare for what that might look like in the future as well. Kind of holding the tension of both. I don't want to only live once and blow all my money now because I'm anticipating not a great lifestyle in retirement, but kind of both. How do I make sure that I am making the most of the right now while preparing for what might be to come, but yet optimistic about maybe having some really beautiful golden years ahead of me? But I would say that's. That's a concern. You know, facing medical issues I think is a concern and potentially a very real reality.
- [52:23]
Jen
Yeah.
- [52:23]
Jill
What about for you?
- [52:25]
Jen
I mean. Yeah, I mean, I. I kind of. You just summed up our whole ethos is to, like, live for today while being able to live in our golden years, to. To hold the tension between both. And I think I. My biggest worry. Okay, vulnerability time. Yeah, here we are.
- [52:49]
Jill
Okay.
- [52:49]
Jen
Yeah, so we've entered in.
- [52:51]
Jill
The door's open.
- [52:52]
Jen
Yeah. I think we're saving. We're saving. Well, we're having children that can drive us around when we're old. I think just my. My greatest fear might be just, I don't know, maybe doing it alone. Yeah. Cause all of my grandfather died before I was born. My dad died when I was in high school. So I think that seeing what that did to my mom and my grandmother, I think that's really my only fear. Otherwise, I feel like we've prepared really well.
- [53:31]
Jill
Right. And those are the things money can't buy.
- [53:35]
Jen
And to enjoy the years that we have while hoping that we get good years in the future. But we don't know.
- [53:42]
Jill
There's only so much we can do with finances. We can face additional difficulties and stressors if we've not prepared financially. But there are things that are going to happen in life that have nothing to do with money. They can be compounded and exaggerated by a lack of money. But, yeah, medical concerns. Money can't solve that. The medical debt money solves. Yeah. Being doing retirement alone, it's not something. Yeah, yeah. I mean, that's why you build community and friends.
- [54:17]
Jen
Hopefully.
- [54:18]
Jill
If you're alone, Jen, I'll still be here. I've got longevity on my side. My will be the old women.
- [54:25]
Jen
Yeah.
- [54:26]
Jill
We'll be the old women who are roommates. Just like living life together. Yeah, I'm down for that.
- [54:32]
Jen
Okay.
- [54:33]
Jill
You won't be.
- [54:34]
Jen
I will call you. The quote that Goldie pulled for this.
- [54:40]
Episode is every little action counts. And it is so, so true. When we are talking about investing long term, especially when we're talking to regular people with regular incomes and not affluent people with super high income, we need to be focusing more on little more frequent actions. So if maybe you're just doing a little bit every paycheck and you get paid every week or every two weeks and you're just putting a little bit from every paycheck in before you spend for the rest of the month or week, that is what that is. The most power that you have have is investing off the top. So and we actually have a financial reset course. It's like a Personal Finance 101 course that we released earlier this year and the whole last section is on investing. So if you feel clueless about investing, particularly for retirement. Yeah, that's the only thing we talk about investing for. Or you can head to frugalfriendspodcast.com reset and get that. And you can also our favorite book is I would say either Rich AF by Vivian Tu or I Will Teach youh to Be Rich by Ramit Sethi. Both of those are really good for learning.
- [56:14]
Jill
Nice.
- [56:15]
Jen
But if you like videos, frugalfriendspodcast.com reset that.
- [56:18]
Jill
Yeah, it doesn't have to be complicated. You just need to start not let our lack of confidence keep us from building this for retirement.
- [56:27]
Jen
You can learn to invest. I think that's the first thing we reiterate in our course is that you are smart enough to do this and you don't need to be that educated on investing to invest for retirement. That's the beautiful thing that technology has progressed investing to make it so accessible. So you don't need to know a lot. It's helpful to know a little.
- [56:55]
Start today.
- [56:57]
Jill
Yes.
- [56:58]
Jen
Yeah. And that's all I have to say about that. Besides, thank you so much for listening. We also have a book where we mention investing, but we don't dive deep into it. It's called Buy what yout Love Without Going Broke. It's about spending. So if your problem with investing is that you never seem to have enough money left at the end of your paycheck to invest, Buy what you love without going broke is the book for you. You can get it@buywhatyoulovebook.com we even have instructions there on how to request it at your library. And Rachel read it and here's what.
- [57:34]
She had to say. Gave it five stars.
- [57:37]
I truly loved reading this book. I got an advanced reader copy back in December and spent a few days reading it over Christmas while taking lots of notes from the opening introduction, which On a personal note, I loved as a teacher myself to the additional research notes at the end. I was a very happy reader all throughout the book. The book was divided into three major parts, so I'll just touch on some highlights from each one. Part 1 I liked the exploration of impulse spending. Part 2 I loved the breakout of different levels of replacements for shopping and an explanation of how habits form. However, my true favorite was Part three. The call to simplify your environment has me thinking of how I could structure decluttering challenges in my own life. The messages to learn about contentment and what generational biases about money might be lurking was truly enlightening. I love this book and I'll be buying another one to share with one of my friends because I'm not letting go of my copy.
- [58:38]
Jill
This is amazing and it's so fun to hear because actually our favorite chapters, both Jen and myself are different, but they're both in Part three. And that's funny because statistically speaking, they say that most people don't make it past the first couple of chapters of a book. And while those are good chapters, still our best chapters are in Part three. We needed to build upon it in order to get there. They couldn't have been in the beginning of the book, but a lot of.
- [59:10]
Jen
Books are good the first half and pointless the second half. And I think ours flip flops. Like it really does build to a crescendo.
- [59:19]
Jill
Yeah. Well, thank you so much for reading that book. If you've read the book, please leave us a review on that. If you haven't, get your copy. BuyWhatYouLoveBook.com and thanks for being here listening. If you're enjoying the show, please leave us a rating and review. That's a free way to help us and help new listeners find us. And of course find us on YouTube. Subscribe to our channel. That's our biggest goal at this point. To be honest with you. We would love to see 10,000 subscribers by the end of this year, and that's a big lift.
- [59:52]
Jen
But we have 10,000 people that listen to each episode of Frugal Friends and it's not even the same listeners. I'm sure you listening right now. You don't listen to every single episode, right? So we have enough to get there. So we're just asking. Go over to YouTube right now, hit subscribe and then go on your way. Maybe leave a comment on the latest video and you tell us which books you thought had a pointless second half.
- [60:22]
Jill
Yes.
- [60:24]
Jen
Whether it be fiction or nonfiction, your.
- [60:26]
Jill
Comment on a video doesn't need to have anything to do with the video itself.
- [60:30]
Jen
We love that.
- [60:31]
Jill
We'll understand.
- [60:32]
Jen
Yeah. So.
- [60:33]
And tell me my. You like the way I talk, please, on any video.
- [60:40]
Jill
That's Jen speaking.
- [60:43]
Jen
Okay, bye.
- [60:47]
Frugal Friends is produced by Eric Sirianni.
- [61:00]
Jill
You got fourth of July plans?
- [61:02]
Jen
No, not at current because it is still June.
- [61:07]
Jill
I mean, you know the classic fourth of July plans, right?
- [61:12]
Jen
Fireworks. Mm.
- [61:13]
Jill
Well.
- [61:14]
Jen
Oh, okay.
- [61:15]
We typically do at Josh's parents.
- [61:18]
Jill
Uh huh. Yeah.
- [61:19]
Jen
Yeah, I think probably we'll do that. That is what we've done every year. And I always forget my bathing suit somehow every year I always know it's the same thing. And sometime I don't like to wear my bathing suit places. I like to just wear my clothes and then change when I'm ready and I'll put it out and then just shuffling everybody together gets left behind. Maybe this is the year I just wear it.
- [61:50]
Jill
I think that's what you should do. So our friends of ours parents live on a waterway connected to Tampa bay. And every 4th of July they let us come crash their house. And then there's always fireworks that you can see from their home over the water. And we all swim in the water up until after the sun goes down, which is not safe. There are sharks in this water.
- [62:20]
Sponsor
Right.
- [62:20]
Jen
Like I'm thinking about it too. Like I wouldn't be able to get in the water even if I did bring my bathing suit because I have two young kids that I'm not gonna let go in that water.
- [62:30]
Jill
All of the other parents do have their children in that water. Their kids are older though, not, not that much older than Kai.
- [62:38]
Jen
They're a little older than Kai. So they're like minimum.
- [62:40]
Jill
Like the four year old was in the water last year.
- [62:43]
Jen
Well, I can't comment on that.
- [62:47]
Jill
But we always bring tubes and we're kind of like on top of the tubes. Right? Sharks don't attack you when you're on a tube.
- [62:55]
Jen
No.
- [62:55]
Jill
I think we all kind of feel comforted by our numbers and who knows, just a full day in the sun that we don't. We just aren't thinking.
- [63:07]
Jen
You don't think that they believe it's a feeding frenzy? Like they just haven't come over there and then they see all your butts in tubes and they're like, oh, yeah.
- [63:16]
That'S a lot of butts. I'm gonna get one of them.
- [63:20]
Jill
I'm gonna get one of them butts.
- [63:24]
Jen
Maybe this is the year.
- [63:25]
Jill
Maybe, maybe it'll be my butt. Who knows? Stay tuned.
- [63:31]
Jen
Probably not your butt. It'll probably be my butt. You know what? I get in that water with my bathing suit. This is the first year and they gonna get my butt.
- [63:41]
Jill
You don't have to be the fastest swimmer. You just have to outswim the person behind you. However that saying goes. It's usually about bears, but I'm gonna make it about sharks. Yeah, I guess so. That's what we'll do. We're gonna maybe tempt the sharks with our bottle bums this 4th of July.
- [63:58]
Jen
Hope you have a fantastic 4th of July.
- [64:02]
Jill
Oh, you're gonna be there in a swimsuit.
- [64:04]
Jen
I'm saying our listeners.
- [64:06]
Jill
Oh, yeah, yeah, yeah, yeah, yeah, yeah. They're still here. That's right. Okay, happy 4th.
- [64:11]
Sponsor
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- [64:12]
Hey, it's Ryan Seacrest for Albertsons and Safeway. It's Oral Care Month, which means you can earn four times points on all your favorite oral care brands. Now through July 1st 15th, shop in store or online for items like Colgate toothpaste, Listerine mouthwash, Crest mouthwash or toothpaste. Sensodyne toothpaste, hello, toothpaste or gum flossers and earn four times points. Points can be redeemed for future discounts on gas or groceries. Offer ends July 15. Restrictions apply. Offers may vary. Visit albertsons or safeway.com for more details.
- [64:43]
For some of us, personal finances aren't just personal. They include a lot more people than ourselves, ourselves, loved ones, neighbors, the communities we call home, and the causes we hold in our hearts. At Thrivent, we help plan your financial picture with the bigger picture in mind. Because even though our business is helping guide your finances, our ambition is to make it mean so much more. Thrivent where money means more. Connect with us@thrivent.com Ah, come on.
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Jill
Why is this taking so long? This thing is angry ancient.
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Jen
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Whoa, this thing moves.
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Jen
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- [66:20]
Jill
This is an I heart podcast.