retirement

Apache is functioning normally

About the series…

When most people talk about money management, they discuss tactics. Occasionally, you’ll encounter someone who elevates the discussion to strategy, rather than simply scattershot tactics.

But what’s missing from both conversations — both tactics and strategy — is a wider-lens look at how to become a better thinker; how to become a crisp, clear decision-maker.

How to think from first principles. How to better your brain. How to cultivate the wisdom to know the next move.

This series is an attempt to bring first principles thinking into the conversation around money. Welcome to the inaugural post.

Welcome back to our new series, First Principles, which explores how to think clearly about money and life, make wise decisions, and better your brain.

Financial Psychology

It’s hard to separate what you think you want vs. what you genuinely want.

We’re taught that we “should” desire certain things. The sprawling, trophy house. The sleek car. The snazzy clothes (does anyone besides me say “snazzy” anymore?)

Those are mainstream examples. But in hidden pockets of internet communities, we’re also subject to that same pressure.

The community of nonconformists will pressure us to conform to their flavor of nonconformity. We learn that we “should” want to quit our jobs, to travel the world, to #tinyhome and #vanlife.

Eff. That.

Figuring out what you want = figuring out what YOU want.

Not what mainstream society wants for you.

Not what any internet community (and that includes this one!) might influence you into thinking that it’s what you want.

First Principles thinking means rejecting the temptation to embrace “copy/paste goals,” a phrase coined by a friend of mine.

This leads to the question – how do you know if what you think you want … is what you want?

The solution comes from flipping the question on it’s head. Don’t ask yourself, “what do I want?” Ask yourself, “what pain am I willing to endure?”

If you want something badly enough, you’ll sweat for it.

You’ll make sacrifices. You’ll embrace pain. You’ll stay up late, wake up early, and dive in with full force.

You might think you want [insert aspiration here]. But do you want it enough that you’re willing to become obsessed, at least temporarily?

Do you want it enough that you’ll endure the pain and sacrifice that it demands?

It’s easy to convince yourself that you want something, even when that dream isn’t in your soul.

The better question: what’s your flavor of pain? How bad do you want it?

SPOTLIGHT ON…

Have you been interested in real estate investing for years, sitting on the sidelines watching the market go up and wishing you’d gotten in sooner?

I have a secret for you: it’s not too late.

Even though parts of the US market are crazy, there are still good deals to be found; you just have to know where to look.

To date (and even in this crazy market) real estate investing is my favorite way to shorten your early retirement timeline, because of the cash flow it generates through monthly rent payments.

If you want a step-by-step, comprehensive guide, enrollment is open for my flagship real estate investing course, Your First Rental Property, for a limited time.

Explore Your First Rental Property

Investing

We talk about “risk tolerance” as though it’s a singular, one-dimensional, linear concept.

The reality is that risk exists along a variety of spectrums, and each are connected, like spokes on a bicycle.

This concept (multiple dimensions of risk) applies to all investing: stocks, bonds, index funds, crypto.

But I’ll use an example that comes from the world of real estate investing, to illustrate the point.

In real estate, you’ll encounter risk levels — low to high – associated with:

  • Leverage
  • The age of the property
  • The condition of the property
  • Neighborhood quality
  • Economic stability of city/state location
  • Population growth of city/state location
  • Tenant screening criteria

You’ll also grapple with risk levels across your personal life, such as:

  • Career choice [stable occupation vs. seasonal or low-demand occupation]
  • Job security
  • One income vs. two income household
  • Number of dependents, both children and aging parents/grandparents
  • Cost-of-living in local area
  • Flexibility and willingness to move
  • Health costs
  • Debt load
  • Volume of recurring monthly bills

When the students in Your First Rental Property ask “should I finance a property?” or “how should I split my portfolio between index funds and rental properties?,” I zoom out and walk them through exercises in which they think about risk across multiple dimensions.

If you’re dialing up the risk in one dimension, I tell them, counterbalance by dialing down the risk in others.

This framework applies to thinking through risk in all types of investments. And it highlights why the phrase “risk tolerance” implies a one-dimensionality to risk that doesn’t flow with reality.

Real Estate

My goodness, all I can say is that you HAVE to look at this.

I mean, seriously. It’s beaaauuuutiful. 😍

I don’t care if you’re planning to enroll in Your First Rental Property or not… just look at that. I’m DAMN PROUD.

I’ve been running Afford Anything for a decade. Ten years ago, I never would have imagined that one day, this little website which I grew from my kitchen table would have such a robust team, an incredible product, and a … well, I never imagined that one day we’d build this.

Wait. Let me correct myself.

I say “one day we’d build this,” but it’s taken five years of well-researched, thorough, painstaking construction. Three years of development. Two rounds of beta. Custom software. We gathered thousands of data points. We tested, iterated and improved relentlessly. And we’ve watched our 1,821 alumni experience amazing success.

If you’ve been thinking of investing in real estate, I’d highly recommend you take a look at Your First Rental Property. I’m confident it’ll help you.

Entrepreneurship

You’re familiar with the concept of “circle of influence” and “locus of control,” right?

Essentially, this framework states that there are many factors that might concern us — the weather, the economy, the stock market – but many of these worries are not within our control.

If we want to be maximally effective, focus on issues that we can directly control.

We can’t control the weather, but we control whether or not we carry an umbrella.

We can’t control the stock market, but we can control our contributions.

My theory is that the appeal of entrepreneurship is that it’s a wealth-creation strategy that’s within our locus of control.

We enjoy more control, effort, influence, and decision-making authority over an entrepreneurial project than we can, say, over an index fund.

And that feels damn good.

(One of the aspects of real estate investing that appeals to me most is that it’s a hybrid between an investment and an entrepreneurial activity. In other words, it’s an investment – like an index fund – that gives us direct control over the revenue and expenses – like a business.)

Hope this third issue of First Principles spurred you to think deeply about what you really want – and how to get it.

I’ll see you in the next issue. Until then!

Click here if you want future posts like this straight to your inbox with more thoughts, ideas and insights on a new take on FIRE.

See you soon!

Source: affordanything.com

Apache is functioning normally

Life is a constant struggle and real estate is at the heart of that struggle. You spend your youth getting the education you need to earn money; your young adult years saving for your first house, and your forties and fifties desperately trying to increase the size of your assets.

Bigger is always better throughout this time. If you find a new home that has more rooms and more square footage than your current home, you feel like you’re moving up in the world. It means you’ll have more room for that gym you’ve always wanted, the home office you need for your new creative project, and the extra bedrooms for your growing family.

But what happens when your children grow up and move out. What happens when you’re too old to care about a gym and have retired from all professional and creative pursuits? You now have a house that is much bigger than you need and is a chore to maintain.

When to Downsize

The idea of downsizing may seem abhorrent to the ambitious go-getter who is intent on going bigger and better, but there are several times when a smaller home and less space makes more sense, including:

Empty Nesters

If you have a big family, with several children and a busy household, it makes sense to get a big home. Kids want their own rooms and putting multiple family members in a small space is only going to cause arguments and fights.

But when those kids leave home, the noise of a busy household turns into the silence of an empty nest and a larger home no longer makes sense.

Sure, you have extra rooms to do with as you please, but extra rooms mean extra cleaning and maintenance. If you’re not very mobile, it doesn’t make sense to live in a multi-story house with several bedrooms that need dusting and bathrooms that need cleaning. 

You’re also sitting on a small goldmine, because by selling up and buying a smaller place, you can use the additional funds to take vacations, buy flash cars and enjoy life a little more.

Struggling Debtors

A big family home costs a lot to maintain, especially if it still has a mortgage. And when you add credit card debts, car loans, personal loans, student loans, and other debts on top of that mortgage, you’ll be left with very little money.

You could take out a home equity loan, but only if you want to cling onto a large home that you don’t really need. In situations like this, it makes much more sense to buy a less expensive home and use the additional cash to pay off debts.

As an example, let’s assume that you live in a 5-bedroom townhouse. If we take the national average, that house could be worth just under $500,000. If you have just $100,000 left on your mortgage and sell for the asking price, you can clear the mortgage, drop $200,000 on a new 2-bedroom house, and once all bills, closing costs, and new furniture expenses have been accounted for, you’ll have around $150,000 to clear your debt.

Being debt-free is a great feeling, much better than owning a large house that you can’t afford.

Homeowners Who Struggle with Upkeep

Bigger homes require more maintenance, and if you’re not very mobile you may struggle to give them the care and attention they need.

Pipes burst, wood rots, doors break, faucets leak. And that’s before you consider all the essentials that need to be replaced every few years. If you lack the DIY skills and can no longer afford to pay someone to help, it might be time to downsize and get a newer and more manageable property, one that has far few maintenance requirements.

Homeowners Struggling with Utility Bills

In stories from the mid to late 19th century, there was a cliché of the old widow who lived alone in a large house that was always cold and poorly maintained because she couldn’t afford the utility bills. She was usually confined to a small portion of the house and left everything else cold, dark, and in a poor state of repair.

This cliché exists for a reason, and while it was once the reserve of “old money” landowners who were desperate to cling onto their family homes despite dwindling income, it is now common in many middle-class homes.

If your financial situation is so dire that you can’t afford to heat the home you live in, it’s time to downsize. 

Bored Retirees

If you’ve spent your entire life working, earning, and sculpting a life for yourself, the last thing you want to do is spend your retirement years walking around an empty house in the middle of nowhere.

You need to live a little. 

By selling up and getting a smaller space, you’ll have more money left over to enjoy yourself. Go on a few cruises, take a trip across Europe, fly to Australia—live your dreams. 

It’s not just about vacations and frivolous spending, either. You can also buy a house that is more suited to your current lifestyle and your desires. You might have purchased a house smack-bang in the middle of suburbia, ideal for raising kids, but what if you’re a city dweller at heart and you miss the big lights? You might have your heart set on going the other way, delving further into solitude by purchasing a cabin in the middle of the woods.

You Want an Investment

Downsizing is often the right move for older homeowners, but younger ones can also benefit by shaving a few square feet off their living space.

Let’s imagine, for instance, that you’re in your forties and have been lucky enough to purchase a large house that is now more or less paid off. You have been working in a high-paying dead-end job for most of your life and want to go out in style before you retire.

You can sell your home and move into a smaller house, before using the money to fund a business or just to invest. You could even purchase several homes, living in one and renting the others. You’ll earn yourself some additional retirement income for when the time comes and if you play your cards right, you won’t have any mortgages to worry about.

Bottom Line: Big Decision

Whatever the reason and whatever you decide, it’s important to take your time and think this through. Buying a new home is a huge step and downsizing is even bigger, because in addition to the buying process, you also have to think about how you’re going to spend all the money you’ll have left over (assuming it won’t go toward clearing your mortgage).

You also have to think about capital gains tax and what will happen to your loved ones’ inheritance.

It’s a big decision made for the long-term and is therefore not one you should make quickly or take lightly. Speak with a financial planner, chat with other home buyers who have done the same thing and get advice from your real estate agent and loved ones.

Source: pocketyourdollars.com

Apache is functioning normally

Could you pay your mortgage, groceries, rent, insurance, medical expenses, and other bills on $2000/month? If you could, what kind of lifestyle might you lead?

Millions of retirees across America live it every day.

The Social Security Administration reports that 50% of elderly married beneficiaries and 70% of singles rely on Social Security for more than half of their monthly income. Considering that the average Social Security check is around $1361/month, this is a really tough place to be in for so many of these retirees.

And I’ve met them. Many of them.

Every year at my insurance agency, we meet thousands of baby boomers aging into Medicare at 65. We often see their shock, dismay, and confusion when they realize that the cost of their healthcare in retirement will easily eat up at least 20% to 30% of that Social Security check every month.

No matter how you slice it, even the best of the retiree budgeters out there are likely to have trouble making ends meet on Social Security income alone.

Sometimes when it comes to personal finance, budgeting isn’t the problem.

Sometimes income is the problem.

Fortunately, there’s good news on that front, because we live in an age where there are more opportunities to earn extra money than ever before. Our digital world has made this possible, and it couldn’t have come at a better time.

When you’re on a fixed income and struggling to make ends meet, a side hustle that pays you even a few hundred dollars a month can be a tremendous help.

At Boomer Benefits, we polled our Facebook fans – largely baby boomers and seniors – to ask what kind of side-hustles they are rocking out there in the real world. What we learned is that there’s a wide array of ways in which creative retirees are supplementing their Social Security income.

 

Today, I’ll share a few of their stories to give you some ideas for your own possible side-hustle that could potentially help to reduce financial worry and afford you a better lifestyle in retirement.

Teach From Home

Did you know that you can get paid to teach English without leaving your house? That’s right, and this is a perfect example of a retirement side hustle that exists today that would not have been possible ten years ago.

Valerie Heidel shared with us that she uses an online teaching platform called Cambly to teach English to students in Saudi Arabia, China, Japan, and even Brazil. She found this job opportunity by searching online for work from home part-time jobs. This work-from-home part was a must so that she could make her own schedule and work only when she feels like it.

What was also important to Valerie in finding a side hustle was the sense of purpose and productivity. And, because she has quite a few repeat weekly students, the job gives her spending cash. She earns $0.17 per minute that she is online with a student, which comes out to $10.20/hour.

Not bad for a job that doesn’t require her to leave her house. And this part-time gig doesn’t require a degree either. You can be approved for teaching gigs like this one in as little as two days (although for some applicants it can take up to two months).

Another retiree we spoke with shared how she used her part-time teaching income to transition into retirement. Our client Nancy was teaching full-time at one college while also teaching health courses part-time online as an adjunct instructor. When she was laid off from her full-time job unexpectedly, she was able to transition into semi-retirement by keeping the part-time health teaching.

J.D.’s note: When Kim’s father retired from teaching high-school English, he too picked up some extra cash by teaching college-level English classes online.

Nancy shared that she has a physical disability which would make it difficult for her to teach in a classroom or report to an office for work. The ability to teach right from her laptop through the school’s Learning Management System has even allowed her to work when she was hospitalized. Once the courses are created, her main duties are to respond to emails and grade assignments.

She loves that it keeps her active and says that she would be bored without this job, so she plans to continue teaching for as long as she possibly can.

Nancy shared that she and her spouse currently use her part-time income to supplement their Social Security income benefits so that they can avoid dipping into their retirement savings for as long as possible.

Takeaway: Nearly everyone has a skill that they could turn into a tutoring, teaching or mentorship position. In addition to Cambly, you can check for opportunities that fit your skills at sites like Tutor, Skooli, and Yup.

Turn Your Passion into Part-Time Income

Jeanine Handley has been a creative artist all her life and worked in graphic design. Now that she’s retired, she does remote graphic design work for clients out of her own home.

She’s also managed to turn this passion into a business right in her own neighborhood. Several years ago, when she relocated to Florida, she moved into a 55+ community. Many of the residents there are active seniors who want to learn and explore new things in their own retirement.

Jeanine noticed that many residents didn’t know how to use the camera and editing features on their smartphones. She helped one woman in her eighties with picking out a new smartphone and iPad and began weekly lessons to show her how to use both.

This blossomed into a course there in the community in which Jeanine helps to introduce other folks to smartphones and smartphone photography. She can communicate and teach these skills in a manner that other seniors understand and appreciate.

Jeanine charges a small fee for this and the money she earns helps to supplement her income and be able to afford some of the extra things like travel, entertainment, and dining out.

As an artist at heart, she doesn’t plan to ever retire this side hustle. Think about your own hobbies and passions. Could there be a way for you to turn that into an income-producing side gig?

Another side-hustler who plans to never retire is our client Billy who is a professional Santa Claus.

That’s right. Santa Claus! How cool is that for an income booster?

As a member of three professional Santa Claus organizations, Billy appears everywhere from schools and restaurants to big city events to spread the holiday cheer. He stresses that this side-hustle is one that really comes from your heart and not from the boots and suit that you wear.

He enjoys talking to children of all ages and listening to their needs. Sometimes the job can require emotional fortitude as the requests aren’t always about gifts or toys but sometimes may include a plea that Santa helps a child’s father find a job.

Yet even so, Billy admits that what he enjoys most is visiting homes of children who are either chronically ill or home-bound. These visits fulfill his heart while the side income he earns helps he and his wife to pay some of their expenses in retirement.

Being Santa can be a serious business both emotionally and professionally. Billy must pass a criminal background check each year and has regularly attended schools and seminars to perfect his craft. He’s also a member of three professional Santa Claus organizations.

Takeaway: Think about the things in your life that you absolutely love to do. Could your passion benefit someone else? How could you monetize that so that you can earn some income while performing activities that hardly feel like work at all?

Become a Contractor for Your Former Employer

When Roberta Baciak retired from working in a local school lunchroom, she felt so bad about leaving them that she volunteered to be a fill-in worker whenever they are short-staffed. They were quick to take her up on her offer, so now she works one day a week every week and sometimes gets called in on other days.

She also works from home 15 hours a week as an administrative assistance for a coffee shop and roasting company owned by her daughter and son-in-law. She takes care of their invoices, payroll, entering expenses into Quickbooks, sending statements and things like that.

Her side hustles have afforded her the ability to pay off some medical bills and to have some pocket cash to spend on little things her grandsons. She also loves the honor of helping her family with their growing business.

She plans on working as long as she can for her family and probably another year or so at the school lunchroom because she enjoys seeing her co-workers and the kids at school.

Roberta recommends that other retirees looking for side-income check with their local schools because lunchrooms are often looking for people who are willing to fill-in on an on-call basis.

Takeaway: Consider negotiating part-time employment with your last employer before retirement. You never know when they might agree! If that’s not an option, who do you know that has a business? Are there any part-time services that you could offer to them with your skills?

Get Financially Fit with Furballs

I honestly can’t think of a side gig I would enjoy more than getting paid to hang out with some fur kids. Busy working professionals are using pet sitting services more than ever – J.D. tells me he frequently uses Rover to book walks for his dog — and what’s great about this particular job is that you could work contract though a pet sitting service, or you could just post your services in neighborhood sites like Nextdoor.

This side hustle is really flexible because you can work only when you want to, and you can pet site in your own home or in someone else’s home for a little more cash.

I myself am a busy entrepreneur, working long hours at the office and frequently traveling for business. When I’m going to be gone overnight, I pay a friend’s mom, who is retired, to come and spend the night with my fur babies.

It helps me sleep at night to know that someone is caring for them, but I also know love that my pet sitter is a retiree who can really use the money to help her make ends meet. It’s a win-win for everyone.

Not sure about overnights? You could start with some day visits or dog-walking, both of which are other pet services that many working people willingly pay for.

Takeaway: This one is possibly the easiest side gig of all to get started in. Post on your favorite neighborhood app or sign up as a pet sitter or dog walker with sites live Rover or Wag.

What Will Your Next Side Hustle Be?

These are just a few of the fun and creative ways to earn extra retirement income that some of our own social media followers at Boomer Benefits have shared with us. No matter what type of work you used to do, there are endless opportunities for new things that you can do once you are retired to supplement your income from Social Security and investments.

If teaching or pet sitting aren’t your thing, check out our post on 50 Ingenius Ways to Earn Money in Retirement for additional inspiration. You might also check out Ryan Helms’ Hustle to Freedom podcast, which is one that I’ve referred dozens of people to when they’ve shared that they want to work part-time but aren’t quite sure doing what.

The key is understanding that our digital world really does make it easier than ever to put a few extra dollars in your pocket each month and sometimes just that little bit makes all the difference.

Happy Hustling!

Source: getrichslowly.org

Apache is functioning normally

Worst Airports to Fly out of During the Holidays – 2017 Edition – SmartAsset

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Flying over the holidays is never an exciting prospect. December means snow in any many parts of the country, and snow means grounded flights, long delays and missed connections. Plus, it seems like just about everyone is flying somewhere making airports stressful places to be. But while the holiday-flying process is not exciting for anyone, some people have it worse than others. Below we analyze flight data to find the worst airports in the country to fly out of.

In order to find the worst airports to fly out of over the holidays, SmartAsset analyzed data for 74 different airports. We compared them across flight cancellation rates, delay rates and average length of delay.

This is the second annual study of the worst airports to fly out of during the holidays. Check out the 2016 version here.

Key Findings

  • Weather – Six of the 10 worst airports are in parts of the country known for bad weather. Wet, cold and snowy winter conditions not only make flying hazardous, but also make it harder for planes to take off. This means longer delays and higher chances of cancellation.
  • Bigger airports not necessarily worse – While you may imagine that bigger airports – which come with more flights and more logistical issues in the case of bad weather – are worse, you would be mistaken. Although some of the 10 worst airports to fly out of are some of the busiest, busy airports can also be found on the other end of our ranking. Passengers flying out of Phoenix Sky Harbor International Airport, Charlotte Douglas International Airport and Hartsfield–Jackson Atlanta International Airport should be particularly happy this holiday season. All three of those airports rank in the ten best airports to fly out of and are efficient airports.

1. San Francisco International Airport (SFO)

Anyone flying out of San Francisco International Airport (SFO) better cross their fingers. Our data shows it’s the worst airport to fly out of over the holidays. If you are flying out of SFO, watch out for the delays. According to our analysis, the average delayed SFO flight departs about 41 minutes late. That is the fourth-longest delay in our study. Definitely a bad sign for people who arrive at their gate on time, but perhaps a blessing for those who are stuck in security.

Additionally, over the past four Decembers, almost 3% of flights out of SFO were canceled, the fourth-highest figure in the study.

2. Newark Liberty International Airport (EWR)

Newark has a bad reputation among New Yorkers and maybe for good reason. Over the past four Decembers, 51% of flights were delayed and 2.75% were canceled. For both of those figures Newark Liberty International Airport ranks in the top 10. The average delayed flight took off about 38 minutes after its scheduled departure time.

3. O’Hare International Airport (ORD)

If you are flying out of Chicago this December, you have two options in front of you. You can fly out of O’Hare, the third-worst airport in our study or Chicago Midway International Airport, 20th-worst.

O’Hare comes in third thanks to high flight cancellation rates. According to our data, over the past four Decembers, 3.4% of all domestic flights out of O’Hare international were canceled. That’s the second-highest percentage in our study.

4. Cincinnati/Northern Kentucky International Airport (CVG)

CVG takes fourth on the list of the worst airports for holiday travel. If you are most worried about whether or not your flight will be delayed, Cincinnati/Northern Kentucky International Airport is actually not a bad place to fly out of. According to our data only 31% of flights out of this airport are delayed. It beats 69 other airports in the study for that stat.

However if you’re unlucky enough to be on one of those delayed flights out of CVG, our research shows the airport has the second-longest average delay time in our study. Over the past four Decembers, the average flight delay time was 45 mins. Additionally, 3.3% of flights were canceled, the third-highest rate in our study.

5. Denver International Airport (DEN)

Denver is a newcomer to our top 10. Our analysis reveals that flights out of Denver International Airport have a bad habit of departing late in December. Over the last four Decembers, more than 56% of flights out of this airport did not leave on time.

One piece of good news is that while flights are often delayed, they are not delayed for the longest time. According to our data, the average delayed Denver flight is delayed by 35 minutes, only the 23rd-worst in the study.

6. LaGuardia Airport (LGA)

According to our data, LaGuardia is the sixth-worst airport to fly out of. The airport has the 10th-highest cancellation rate in the study. Over the past four Decembers, 2.5% of flights were canceled.

It also has long delay times. According to our data, delayed flights can expect to leave almost 40 minutes after the scheduled departure time. For that metric LaGuardia ranks seventh.

7. Dallas/Fort Worth International Airport (DFW)

Unfortunately for Dallas/Fort Worth residents, flights out of DFW are canceled fairly frequently. Over the past four Decembers, DFW had a 4.9% flight cancellation rate. That’s the highest of the 78 airports we analyzed.

In other metrics this airport fared better. For example, the average delayed flight is only late by 33.9 minutes, the second-shortest in the top 10.

8. Will Rogers World Airport (OKC)

Will Rogers World Airport in Oklahoma City retains its spot on this list. If you are flying out of this airport in December, you risk having your flight canceled. Over the past four Decembers, about 2.8% of flights out of OKC were canceled.

The one piece of good news for air travelers out of OKC is that the majority of flights left on time. Just over 41% of December flights out of OKC departed late. That’s the second-lowest rate in the top 10.

9. General Mitchell International Airport (MKE)

Milwaukee winters make for tough flying weather. Perhaps that is one explanation for why General Mitchell International Airport has such a tough time getting flights out. According to our data, 2.4% of flights were canceled over the past four Decembers. That means about one out of every 40 flights got canceled.

This airport also scores poorly in average length of delay. The average delayed flight did not depart until almost 37 minutes after its scheduled departure. That sort of delay can disrupt a tight connection.

10. Washington Dulles International Airport (IAD)

Flying out of Dulles this December? Beware, your flight may be delayed. Over the past four Decembers, 46% of flights out of this airport did not leave on time. The average delay time was 34 minutes. Furthermore, about one in 50 flights were canceled.

Data and Methodology

In order to find the worst airports to fly out of over the holidays, SmartAsset looked at December flight data for 78 airports. Specifically we looked at airports which had at least 4,000 flights during December 2013 – 2016. We compared the airports across the following three factors.

  • Cancellation rate. This is the percent of flights which were canceled during the past four Decembers. Data comes from the United States Department of Transportation Bureau of Transportation Statistics.
  • Delay rate. This is the percent of flights which left later than the scheduled departure time over the past four Decembers. Data comes from the United States Department of Transportation Bureau of Transportation Statistics.
  • Average delay time. This is the average length of delay for flights which were delayed. Data comes from the United States Department of Transportation Bureau of Transportation Statistics.

First, we ranked each airport in each metric. Then we found each airport’s average ranking. We gave a half weight to delay rate and a full weight to the other two metrics. We then used the average ranking to create our final score. The airport with the best average ranking received a 100. The city with the worst average ranking received a 0.

Tips for Managing Holiday Travel

Did you know that some travel rewards credit cards include reimbursement if your flight is delayed or canceled? Some credit cards will pay you back if you are forced to check into a hotel due to bad weather delaying your flight.

Often during overbooked flights, airlines will offer vouchers to passengers who give up their seats. If you are not pressed for time, it may be worth it to take the airline up on the offer. However, you should also know your rights if you can’t get on a plane because it’s overbooked. In that case, the airline has to pay you a certain amount based on how much longer your travel time becomes. For example, if you get to your destination two hours later than you would have before being removed from a flight, the airline owes your $1,350. Make sure you don’t settle for less.

Questions about our study? Contact us at [email protected].

Photo credit: ©iStock.com/blowbackphoto

Derek Miller, CEPF®
Derek Miller is a graduate of the University of Edinburgh where he studied economics. He is passionate about using data to help people make better financial decisions. Derek is a Certified Educator in Personal Finance® (CEPF®) and a member of the Society for Advancing Business Editing and Writing. He is a data journalist whose expertise is in finding the stories within the numbers. Derek’s writing has been featured on Yahoo, AOL, and Huffington Post. He believes the biggest financial mistake people make is waiting too late to save for retirement and missing out on the wonders of compounding interest. Derek lives in Brooklyn.

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The Most Dangerous Jobs in the U.S. – SmartAsset

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There were 4,821 fatal occupational injuries in America in 2014. That’s a 5% increase from 2013, according to the Bureau of Labor Statistics. While all workplaces take precautions to limit fatal accidents, there are some occupations for which the risk of fatal accidents is unfortunately much higher.

In order to determine the most dangerous jobs in the U.S., we looked at total number of fatalities and hours worked from 2011-2014 for all occupations for which the Bureau of Labor Statistics keeps records. We ranked the most dangerous jobs by fatality rate, which we measured in fatalities per 100,000 workers. You can read our full methodology below.

Find out how much life insurance you need.

Key Findings

  • Low-paying manual labor – Many of the most dangerous jobs are forms of lower-skilled manual labor. Often they don’t require more than a high school education. In many cases, these workers are not very well-compensated despite the risks that they face.
  • Driving can be dangerous – Several occupations that involve a significant amount of driving appeared on our list. Truck drivers, refuse collectors and taxi drivers and chauffeurs ranked in the top 10.
  • Police work – A total of 411 police and sheriff’s patrol officers died on the job during the four-year period we considered. About half of those deaths were due to injuries caused by people or animals, according to the Bureau of Labor Statistics. Still, police work only ranked as the 14th most dangerous job.

1. Logging workers

Logging is the most dangerous occupation in the U.S. with a fatality rate of 89 per 100,000 workers. Logging is physically demanding and requires large portions of time spent outdoors in potentially hazardous areas. According to the Bureau of Labor Statistics, most fatalities among logging workers occur from falling logs or contact with a machine. Logging workers earn a yearly median income of $36,210. That’s in contrast to the overall median income for full-time workers in the U.S. which is $44,819. Most logging work is done in the Pacific Northwest in the evergreen forests of Washington and Oregon.

2. Fishers and related fishing workers.

The Discovery Channel produces a show called “The Deadliest Catch” which highlights the dangers of high seas fishing. The fatality rate for fishers and related fishing workers is 81 per 100,000 workers. The majority of on-the-job fatalities among fishers occur from drowning. Another concern for fishers is that when accidents occur workers are often far out at sea where access to medical facilities may be limited.

3. Aircraft pilots and flight engineers

The fatality rate for this occupation is 54 per 100,000 workers – almost 30% less than the fatality rate for the occupations in the first two positions. Commercial pilots face risks from hazardous weather as well as long overnight flights, but flying non-commercial aircraft is often more dangerous. Non-commercial pilots are involved in firefighting and crop dusting, both of which require flying at low altitudes with a higher chance of fatal accidents. Due to the dangers, plus the high skill level required for flying aircraft, pilots and flight engineers make an average of $117,290.

Related Article: The Top 10 Jobs for Salary and Growth

4. Roofers

Roofers had a fatality rate of 38 per 100,000 workers over the 2011-2014 timeline. Most fatalities among roofers occur from slipping from scaffolding, ladders or roofs. Interestingly, the Bureau of Labor Statistics predicts that roofing will experience a 13% job growth over the next decade, which is higher than average. The occupation pays $36,720 on average.

5. Refuse and recyclable material collectors

Refuse and recyclable material collectors have a fatality rate of 32 per 100,000 workers. Workers in this occupation make $36,370 per year on average. Refuse and recyclable material collectors face dangers from driving, as well as accidents related to the truck and lift systems.

6. Farmers, ranchers and other agricultural managers

Farmers, ranchers and other agricultural managers “operate establishments that produce crops, livestock and dairy products,” according to the Bureau of Labor Statistics. Workers in this occupation had a fatality rate of 24.7 per 100,000 workers over the 2011-2014 period. While farming may sound relatively safe, there are dangers involved with operating the heavy machinery required for mass production. Farmers make $64,170 per year on average, and around 70% are self-employed.

7. Truck drivers and driver/sales workers

Truck drivers and driver/sales workers experience a fatality rate of 23 per 100,000 workers. This occupation can be dangerous because driving long hours may become tiring and result in vehicular accidents. Workers in this occupation make $27,760 per year on average.

Related Article: States With the Worst Drivers

8. Electrical power-line installers and repairers

Other than facing the obvious danger of electrocution, workers in this occupation also need to get over their fear of heights. Although they typically use bucket trucks, electrical power-line installers and repairers occasionally have to climb utility poles by hand. Alabama has the highest concentration of electrical power-line installer and repairer jobs in the country at 2.06 per 1,000 jobs.

9. Taxi drivers and chauffeurs

Taxi drivers and chauffeurs have a fatality rate of 18 per 100,000 workers. Like delivery truck workers, they face dangers from long hours on the road. On average taxi drivers and chauffeurs make $23,150 annually. There is little to no education required for becoming a taxi driver and typically little on the job training which is why it’s a lower-paying occupation.

10. Miscellaneous agricultural workers

These are people who work under the farmers, ranchers and agricultural managers who we discussed earlier. These workers may have less dangerous jobs than farmers and ranchers because they spend less time operating the heavy machinery which pose the greatest threat to people working on farms. These workers also face danger from livestock. Overall, this is the lowest-paying occupation in the top 10 with an average annual salary of $20,090 or about $9 per hour.

Data and Methodology

In order to rank the most dangerous jobs in the U.S., we gathered data in the following two metrics:

  • Total fatalities per occupation. This measures the raw number of fatalities in each occupation over the 2011-2014 time period. The data comes from the Bureau of Labor Statistics.
  • Total hours worked per occupation. This measures how many total hours were worked in each occupation over the 2011-2014 time period. It is measured in millions of hours. The data comes from the Bureau of Labor Statistics.

We used these two metrics to calculate the number of fatalities per 100,000 workers in each occupation.  To do this, we divided the total number of fatalities by the total number of hours worked and then multiplied the result by 100,000 (to account for 100,000 workers) and then by 2,000 (to account for the estimated number of hours each employee worked per year). We assumed that each employee worked 40 hours per week for 50 weeks per year.

We then ranked each occupation from the highest fatality rate per 100,000 workers to the lowest fatality rate per 100,000 workers.

For the sake of clarity, we excluded a few vaguely worded occupations from the final ranking. We also did not include occupations for which we did not have complete data over the four-year time period. For example, we have data for mining machine operators in 2013 but not in 2014. As such, they were not included in the final table.

Question about our study? Contact us at [email protected].

Photo credit: ©iStock.com/Josef Mohyla

Derek Miller, CEPF®
Derek Miller is a graduate of the University of Edinburgh where he studied economics. He is passionate about using data to help people make better financial decisions. Derek is a Certified Educator in Personal Finance® (CEPF®) and a member of the Society for Advancing Business Editing and Writing. He is a data journalist whose expertise is in finding the stories within the numbers. Derek’s writing has been featured on Yahoo, AOL, and Huffington Post. He believes the biggest financial mistake people make is waiting too late to save for retirement and missing out on the wonders of compounding interest. Derek lives in Brooklyn.

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By Jason Price 2 Comments – The content of this website often contains affiliate links and I may be compensated if you buy through those links (at no cost to you!). Learn more about how we make money. Last edited July 22, 2010.

Most people are busy learning about a 401(k), taking steps to set it up and choose the right investments. But how often do you think about what will happen to your retirement savings if something were to happen to you? To be honest, such thinking has been off my radar screen, but after getting a nice reminder in the Dallas Morning Newspaper earlier this month, I know I need to check to make sure things are in proper order. As an aside, so much of good personal financial management is staying organized, simplifying and making sure you’re on top of matters.

Determine Who Will Get The Money In Your 401(k)

It’s extremely important to make sure your beneficiary information is up to date, or that you establish who they are. Sometimes people forget to change them after a major life event such as a new marriage, divorce or when someone gets remarried.

I didn’t realize this, but you have to actually name your beneficiary in your 401(k). Specifying a beneficiary in your will, at least according to the article, is not enough. However, if you’re married, according to federal law, your surviving spouse is the automatic beneficiary. If you want it to be someone else you definitely have to specify it. Dont’ forget to list a contingent beneficiary in case your spouse passes away before you do.

Listing beneficiaries is important for singles too as your retirement plan could end up in court if you don’t specify a beneficiary.

What About Taxes?

Okay, so how do taxes work if something were to happen to you? Your spouse can role the 401(k) directly into an IRA and continue to let the money grow tax free until age 70 1/2. Your spouse can also roll the funds into an inherited IRA in which the first minimum distribution must be taken one year after death. Distributions are taxed, but there are no penalties.

What if you’re someone other than a spouse? You can’t roll over the funds into a regular IRA, but can set up an inherited IRA to avoid tax penalities and withdraw the minimum amount required by the IRS.

How Do You Handle Multiple Beneficiaries?

Some people want to give a portion to their spouse, but also to children in equal shares. Here’s what the article suggests –

If you name your spouse per stirpes, the money would flow equally to the children. Let’s say you have grandchildren, too. If one of the children happened to die, that child’s share of the money would then flow to that person’s children equally.

So, while it’s not great to think about such matters you can see why doing so is important. I don’t know about you, but I’m off to double check my beneficiaries. Oh, there is one final bit advice which I thought was good. Make sure you tell someone about your decisions. You need to keep beneficiary forms in a safe but accessible place. I would recommend creating a special file for your will and other such forms in case someone close to you needs find them.

What do you think about these tips on handling beneficiary information for your 401k, inherited IRA, or other retirement accounts?

Source: Dallas Morning News

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How to Invest in Nuclear Fusion Energy

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Nuclear fusion may well be the technology of the future.

Not a technology. For many engineers, if physicists can ever crack the secrets of  fusion, it may be to the 21st century what coal was to the 19th and petroleum was to the 20th. This could become a new ubiquitous technology, a part of infrastructure found on every part of the globe.

For investors, there’s enormous potential here. If you’re looking to understand how the technology of the future can power your own retirement as well, read on.

For help building a balanced investment portfolio, consider working with a financial advisor.

Nuclear Fusion Basics

Nuclear fusion energy is the idea of generating electricity from combining two atoms to create a new one. When two atoms fuse, the resulting atom has slightly less mass than the sum of its parts. This is due to the weak nuclear force, a form of mass/energy which binds subatomic particles together into atoms. Each atom has its own binding energy, so when two atoms are combined into a single entity this leftover binding energy is released as lost mass from the resulting atom. That generates the heat of a fusion reaction.

Fusion is the corollary to fission, the other currently understood source of nuclear energy. With fission, you create a reaction that splits a large atom into two smaller atoms. With fusion, you create a reaction that joins two smaller atoms into a larger one. Fission is rarely found in nature at large scale, but fusion is the power source for stars.

As a power source, fusion has many benefits over fission.

First, fusion is far safer than fission. Once you start a fission reaction, you must actively control it or it can flash consume all of its fuel in an explosive event. The hydrogen that fuels a fusion reaction, on the other hand, can be added as its consumed, meaning that the entire reaction will cease if you simply stop adding fuel. After a reaction, fission leaves behind highly toxic radioactive waste that can even be weaponized in the wrong hands. Fusion leaves behind helium, an inert and harmless gas that the world could actually use more of.

Fission is powered by relatively rare and expensive enriched uranium. Fusion is powered by an isotope of hydrogen, the most common element in the universe.

To top it all off, fusion generates more power than any other known process. With an equivalent amount of fuel, a fusion reactor can generate four times as much electricity as the fission reactors that current nuclear power plants use. That same fusion reactor can generate 4 million times as much energy as a chemical plant powered by coal or oil.

Fusion’s Problem

The basis behind a fusion reaction is what’s known as “the bottle.” It’s not currently possible to wrap up even tiny stars in a physical reactor. Any solid material would vaporize right away. Instead, the fusion reaction takes place inside a high-energy plasma. That plasma, in turn, is contained by a series of powerful magnetic fields. These shaped magnetic fields are called “the bottle.” The bottle contains and directs the heat of the fusion reaction, making it safe and productive.

The problem is that, with current technology, it takes more energy to sustain the magnetic bottle than the fusion reaction produces. The hotter you burn the reactor, the more energy it takes to keep the reaction contained. The result is energy-negative.

That’s changing however. Advances in several different fields, from mathematics to superconductors, are making it steadily more efficient to generate the magnetic bottle that contains and sustains a fusion reaction, and in 2022 the Lawrence Livermore National Laboratory made a credible claim to have generated a positive-sum reaction.

Investing In Fusion Through Companies

Investing in fusion is not easy. Since this is a developing technology, any investment in this field is fundamentally speculative. There are no publicly traded companies that operate fusion reactors, because no commercial fusion reactors exist yet. You can’t have an industry around a product that only exists as a very convincing theory.

That said, this is still a billion-dollar industry, with around $4.8 billion invested as of 2022. While much of that work is being done by government and university labs, there are several dozen private startup companies that are trying to develop their own reactors. Firms like Helion Energy and Commonwealth Fusion Systems have generated hundreds of millions in investment capital. Unfortunately for individual investors, they remain private companies. If you are an accredited investor, you can look for shares that someone might be willing to sell. Otherwise, it’s not currently possible to buy into a fusion company directly.

Instead, you have two major options.

Invest In Investors

First, you can invest in publicly traded companies that have themselves invested in fusion companies.

This is a technology that promises to fundamentally change the energy economy from the ground up, and the big players aren’t sitting that out. Major technology companies like Alphabet (GOOG) and Amazon (AMZN) have invested in fusion research companies. Lesser-known, but still large, firms like Babcock International (BCKIF) and Cenovus Energy (CVE) have done the same.

These companies have a significant stake in the companies that are trying to develop fusion technology. If those underlying investments pay off, the benefits will extend upward.

Other sources on this subject also recommend investing in firms that can benefit from the results of fusion, namely vast and cheap energy. If you want to do this, we recommend simply investing in the S&P 500. The reality is that virtually every company will benefit from these productivity gains and cost reductions. There’s no good way to pick a clear winner or loser, because all companies rely on energy-intensive resources.

Invest In Energy Companies

However advanced, fusion is still fundamentally an investment in the energy sector. The result is that investors looking to get into this market can do so by taking a long-term position in the energy sector.

You can do this by investing in specific energy source companies like Chevron (CVX). You can also invest in utilities that run power plants, like Duke (DUK) or National Grid (NGG). Or, you can invest in energy-sector funds. These would include mutual funds or ETFs like the Vanguard Energy ETF (VDE) or Global X Renewable Energy Producers (RNRG).

This is a long-term investment. Researchers are confident that fusion will become a viable, long-term energy source, one likely to significantly outlive fossil fuels.  It’s not here yet though and, once it arrives, it probably will take quite a while to really take off. This is a good investment for your retirement portfolio, but probably not for the swimming pool fund.

Investing In Fusion Through Materials

Side-investing in nuclear fusion is another potentially good strategy.

Fusion relies on a handful of specialized resources to build its reactors and sustain its burn. The fuel source for fusion will be a mix of hydrogen isotopes called deuterium and tritium, although current experimental reactors only use deuterium. For the science-curious:

  • Hydrogen atom – An atom with one proton and one electron
  • Deuterium – An atom with one proton, one neutron and one electron
  • Tritium – An atom with one proton, two neutrons and an electron

The heavier nuclei of deuterium and tritium make them easier to fuse and release more energy in the process. As an investor, you can seek out companies that produce deuterium gas (tritium is not yet produced in commercial quantities).

You can also seek out desalinization companies. Hydrogen isotopes are generally produced from water, by separating the molecule’s oxygen and hydrogen atoms from each other. To get enough water without wasting potable and agrarian supplies, producers will most likely rely on seawater production, which requires large scale desalinization.

Finally, you can seek out firms that make the components of a reactor itself. On this, we cannot offer specific advice because nobody knows what a working fusion reactor will be made of. Most likely, commercial fusion reactors will rely on superconducting materials to make the core of the electromagnets that contain the reaction. Companies that produce materials like mercury, titanium, niobium alloys, and next-generation ceramics are all good candidates as long-term suppliers for a fusion reactor’s core.

Bottom Line

Investing in fusion may be one of the most solid bets anybody can make on long-term investments in the future. You can do so by investing in companies that are trying to build their own reactors, by investing in the energy sector or by investing in the companies that will someday fuel these reactors.

Energy Investment Tips

  • Fusion is the big dream of next-generation energy. Before physicists crack that puzzle, though, there are many ways you can invest in next-generation energy right now.
  • A financial advisor can help you build an investment portfolio that includes fusion investments. SmartAsset’s free tool matches you with up to three vetted financial advisors who serve your area, and you can interview your advisor matches at no cost to decide which one is right for you. If you’re ready to find an advisor who can help you achieve your financial goals, get started now.

Photo credit: ©iStock.com/mesh cube, ©iStock.com/WangAnQi, ©iStock.com/Farknot_Architect

Eric Reed
Eric Reed is a freelance journalist who specializes in economics, policy and global issues, with substantial coverage of finance and personal finance. He has contributed to outlets including The Street, CNBC, Glassdoor and Consumer Reports. Eric’s work focuses on the human impact of abstract issues, emphasizing analytical journalism that helps readers more fully understand their world and their money. He has reported from more than a dozen countries, with datelines that include Sao Paolo, Brazil; Phnom Penh, Cambodia; and Athens, Greece. A former attorney, before becoming a journalist Eric worked in securities litigation and white collar criminal defense with a pro bono specialty in human trafficking issues. He graduated from the University of Michigan Law School and can be found any given Saturday in the fall cheering on his Wolverines.

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Welcome to NerdWallet’s Smart Money podcast, where we answer your real-world money questions.

This week’s episode starts with a round of Money Hot Takes.

Then we pivot to this week’s money question from Sean:

“Hey folks,

Huge fan of the podcast. I have been listening for years, but this is, I think, the first time I’m submitting a question and it’s a complicated one.

I currently work as an engineer for a municipal utility. As an engineer, I have some ability for job mobility. While I do like my job, I have thought about what it would take to draw me away from my job, and I have had trouble figuring out what a ‘godfather offer’ would need to be.

As a civil servant, I have great healthcare, a pension, job security and overtime if I work beyond my scheduled 40-hour workweek. In the private sector, I have more income potential, but I would lose a lot of these benefits and end up working a lot more hours. I’ve had some trouble figuring out how to evaluate some of these benefits, particularly the pension.

Thank you,

Check out this episode on either of these platforms:

Episode transcript

Sean Pyles: Hey, Liz, if you had a job that offered you a pension, would you still leave just because you were bored?

Liz Weston: Well, pensions are sweet, but I do like being challenged, so maybe.

Sean Pyles: All right, I’m going to say I wanted a yes or no answer, but I think that that’s OK. I just hope that you would at least stick around until you’re fully vested.

Liz Weston: Well, of course.

Sean Pyles: Yes. But in this episode, we answer a listener’s question who’s considering bailing on a pension.

Welcome to the NerdWallet Smart Money podcast, where you send us your money questions and we answer them with the help of our genius Nerds. I’m Sean Pyles.

Liz Weston: And I’m Liz Weston. Listeners, remember to send us your money questions. Maybe you’re wondering if now is a good time to buy up a bunch of gold or you’re wondering how far in advance you should book an international vacation. Whatever your questions, send it our way. Leave us a voicemail or text us on the Nerd hotline at 901-730-6373; that’s 901-730-N-E-R-D. You can also email us at [email protected]

Sean Pyles: In this episode, our co-host Sara Rathner and I answer a listener’s question about how to leave a job. But first, Liz and I are going to get mad because it’s time for another round of Money Hot Takes. This is our occasional segment where we rail against something that we just don’t like in the personal finance space. The goal is for us personally to blow off a little bit of steam and hopefully help our listeners make smarter decisions in a world full of scammers, fraudsters and phonies or sometimes just plain old misconceptions that can cost you money.

Liz Weston: Oh, I love this. This is going to be fun. OK, Sean, what do you have for us?

Sean Pyles: Today, I’m calling out the online, quote, unquote, “courses” that some influencers peddle to their followers. A lot of these classes aren’t providing you any information that you can’t get on your own for free, and the folks teaching them are often, shall we say, not exactly qualified. And a shoutout to Rebecca Jennings from Vox who wrote an article that so well articulates my feelings and concerns around these courses. We’ll have a link to that article in the show notes.

Liz Weston: So what’s in these courses, Sean?

Sean Pyles: Kind of everything that you can imagine you might want to improve upon. There are classes in things like how to use Excel. There are classes in how to get started investing or budgeting. There are even classes on how to make your own class to sell to people, which is a little meta.

Liz Weston: Of course, of course.

Sean Pyles: And the prices vary greatly. Some are under a hundred dollars; others are over a thousand dollars, maybe $2,000.

Liz Weston: Ooh, well, I think I know the answer to this question, but tell us why you don’t like them.

Sean Pyles: Well, as I mentioned at the outset, a lot of people are paying for information that they can get elsewhere for free. And again, many of these people have very questionable credentials. Sometimes the people who are teaching these classes are not actually experienced or qualified in what they’re telling you to do. And in fact, they’re just really good at marketing themselves, which I always have an issue with. People who seem just overly into marketing their own personality for the sake of getting money and attention on the internet.

Liz Weston: Yeah. And I imagine that could cause people not to go to good sources to get their information or leave them with a patchwork of incomplete information.

Sean Pyles: Exactly. They think that they’re getting everything they need to know about how to get started investing from one online class when in fact it might just be a small piece of the picture. Also, they can seem a little scammy to me. This is especially the case with classes around investing. Some will teach you how to invest and then maybe try to get you set up with investing during the class, and they’ll get you set up through a platform that also pays the influencer and affiliate commission, which seems like quite the conflict of interest there. And also, never mind the platform the influencer is peddling might not be the right one for you. So this person is getting money from you signing up for their class, and they’re also getting money from the company that they’re pushing on you as well, which I just don’t like.

Liz Weston: Now, I will say I like online courses in some cases because they help me get up to date or catch up on something I should have learned earlier, like Excel. The Excel courses were very helpful, but they’re not all bad. So how do you determine which are the better ones?

Sean Pyles: I’m with you, Liz. I am not an absolutist. In pretty much anything, there are plenty of great online classes. I’m a huge fan of Masterclass, for example. Not paid to say that; I just use their stuff a lot, but they are very well vetted. I think it’s important to vet your sources and to be selective about the type of information that you’re getting. Maybe a language course from someone who lives abroad and has learned a different language is something that you can more easily get into versus a class that’s about the secret to getting rich. Also, maybe don’t have this online course be the only source of information on the subject.

Liz Weston: Yes, maybe you could even come to a site, I don’t know, NerdWallet.

Sean Pyles: Yeah, we are a great alternative. And you know what? I think some folks might be thinking, “Hey, how is NerdWallet different from these online personal finance influencers or courses?” And to that, I have two words to say: journalistic rigor. Our content is deeply reported, edited, fact-checked, not to mention editorially independent, to ensure that the information that we’re giving is as accurate and consumer-first as possible.

Liz Weston: And if you need more personalized help with your money, there are plenty of professionals who can help you. Financial coaches can help you get a grip on your budget and financial goals. Accredited financial counselors can offer tools to wrangle your debt, and fee-only fiduciary financial planners are a solid choice if you need guidance on building your wealth.

Sean Pyles: Very well said, Liz. So that is my rant, and Liz, now you’re up.

Liz Weston: OK. This is really nerdy, Sean, but I am annoyed that people don’t understand how life expectancy works.

Sean Pyles: OK, you’re right. That is really nerdy. I’m going to need you to elaborate on what that even means and why it’s making you so mad.

Liz Weston: OK. This is important because understanding life expectancy is key to so many things about retirement planning, which is basically how long your retirement will last, right? So you need to know roughly your life expectancy so you can figure out when to take Social Security, and it probably can help you better understand all the debates about raising the retirement age. Remember when I was in Paris and they were setting fire to the garbage over there?

Sean Pyles: Yes.

Liz Weston: Yeah, that’s this debate. So I just read a New York Times article about the best age to retire, and it used the wrong number. It said the average life expectancy was 76 years.

Sean Pyles: OK, so you’re out here dragging the Gray Lady for being wrong, is that right?

Liz Weston: Sorry, hats off to The New York Times, lots of great reporting, but that’s the average U.S. life expectancy from birth. That factors in infant mortality and all the people who die young or young-ish from accidents or disease or whatever. That number is 76, by the way, because largely of all the COVID deaths, which is the reason that life expectancy has dropped a bit. But that number is pretty much irrelevant for retirement planning because the longer you survive, the longer you’re likely to survive. What matters is how much life you’re likely to have left when you get to retirement age. And at 62, which is the earliest age you can claim Social Security, the average man can expect to live until almost 81 and the average woman till 84. If you make it to 65, both men and women are likely to make it to their mid-80s. Now, your mileage may vary. Obviously, lifestyle, genetics, other factors come into play. Unfortunately, Black people tend to have shorter life expectancies. But the more income and education you have, the more years you can probably add to your life expectancy.

Sean Pyles: And I imagine this really matters when it comes to claiming Social Security.

Liz Weston: Oh, it’s so true. If you file early at 62, you are settling for a permanently reduced check. You’re giving up a lot of money because you’re likely to live well past the age when the larger checks that you would’ve gotten for waiting more than make up for the smaller checks you bypassed in the meantime. We talked to Nerd Tina Orem, and her calculator can show you your break-even age. And what’s more, if you’re the higher earner in a married couple, you’ve really done your spouse a disservice if you file early. And that’s because your benefit determines what your spouse gets to live on after you’re gone. So starting early means you’ve permanently reduced the survivor check that your spouse will have to live on for the rest of their lives.

Sean Pyles: Got it. OK. And that’s especially important for men to think about because women tend to outlive men.

Liz Weston: Yeah. And if you are a same-sex couple, again, it’s the higher earner that matters. So it’s something to keep in mind. The higher earner should delay as long as possible. And also, it can really help to use a calculator to estimate your own life expectancy. And there’s a really good one at livingto100.com.

Sean Pyles: Well, I think that we both feel a little bit better getting that out of our system. I don’t know about you, Liz.

Liz Weston: Yes, thank you. I do.

Sean Pyles: Great. Now let’s get on to this episode’s money question segment with co-host Sara Rathner.

Sara Rathner: This episode’s money question comes from the excellently named Sean, who sent us an email. “Hey folks, huge fan of the podcast.” Thank you. “I’ve been listening for years, but this is, I think, the first time I’m submitting a question and it’s a complicated one. I currently work as an engineer for a municipal utility. As an engineer, I have some ability for job mobility. While I do like my job, I have thought about what it would take to draw me away from my job. And I’ve had trouble figuring out what a, quote, unquote, ‘Godfather offer’ would need to be. As a civil servant, I have great healthcare, a pension, job security, and overtime if I work beyond my scheduled 40-hour work week. In the private sector, I have more income potential but I would lose a lot of these benefits and end up working a lot more hours. I’ve had some trouble figuring out how to evaluate some of these benefits, particularly the pension. Thank you, Sean.”

To help us answer Sean’s question, on this episode we’re joined by NerdWallet data writer Liz Renter. Welcome back to Smart Money, Liz.

Liz Renter: Thanks, Sara. I’m excited to be here.

Sean Pyles: So first, I think folks should understand the total value of work benefits because it extends well beyond the cash that you get. According to March 2023 data from the Bureau of Labor Statistics, for government workers, benefits represent about 38% of compensation, compared with just under 30% for private-sector workers. As our listener knows, the benefits of government jobs are pretty cushy, and that can be really hard to give up.

Sara Rathner: That 30% to 38% figure might come as a surprise to you because I think when people are evaluating a job opportunity, there’s so much of a focus on the salary and maybe a bonus if that’s part of the deal. But if you’re thinking of leaving your current job, it is worth it to work to understand your total compensation, not just wages, but benefits as well. So listing out your benefits, like paid time off, access to resources like financial advisors or even discounted legal assistance, maybe some cold brew coffee on tap in the office kitchen.

Each of these has a specific value, but it can be pretty tedious to add it all up. Another big thing to think about are taxes. This is a bigger deal if you’re thinking of becoming a freelancer or a contract worker where you’d be on the hook for sorting out your own tax obligation. Based on what you figure out, you might decide whether or not you want to go down the freelancer or contractor route at all, or would you prefer to be a full-time employee at a company? Another big one, this is a really big one: health care.

Liz Renter: Huge.

Sara Rathner: Huge and so expensive. Definitely contact HR during the interview process, or when you have the offer and you have some time to think it over, to get the health care plan options and their pricing.

Liz Renter: Yeah. And I just want to interject, Sara, that’s a good point. If you’re talking to a potential employer or even your current employer about what the health care costs look like, how much they’re covering, keep in mind that employers get a heck of a discount on premiums. They get a group discount because they’re paying for multiple policies at once or helping to pay for multiple policies at once. So if self-employment is under consideration or a job that may not offer health insurance at all, your premiums are going to be much, much higher than what your employer would be paying in the situation where they’re helping to cover those costs.

Sara Rathner: Yes. And I have been in both boats and …

Liz Renter: Same.

Sara Rathner: … real expensive to be self-employed when it comes to health insurance coverage. And that was one of my reasons for not pursuing that for the remainder of my career if I can help it. But you know, you do you. And then also, here’s another one. There are all these extra benefits that really add up. Things like a monthly gym stipend or a cell phone stipend. A lot of remote workers get a home internet stipend as well. And the cost of these things can really offset the price of some of the things you might have been paying for out of pocket if you were previously at a job that didn’t provide this as a benefit.

Liz Renter: Right. And I think those things are far less likely in, like the listener wrote in about, a municipal job or a state government job. Unlikely you’re going to have a keg of cold brew in the kitchen unless you’re in a really affluent city and tax rates are pretty high. But you’re right, some of those things that you take for granted, the snacks and the catered lunches at private industry, really do add up. You can spend a lot of money on those yourself if you’re having to pay for them.

Sara Rathner: Yeah, you definitely see a lot of those benefits in the tech industry because they are just falling all over themselves to make these companies more attractive to job applicants than the tech company down the street. Literally down the street, depending on what city you’re in. And so if that’s an industry where you are weighing some job offers, then yeah, you’re going to see some pretty wild benefits that have a dollar value to them.

Sean Pyles: Well, that said, there is one benefit that you will maybe get at a municipality that a tech company is not really going to be offering you. And that is the pension benefit that our listener wrote in about. And I want to give a quick rundown of how pensions work because they’re pretty incredible and they’re unfortunately not very common. So pensions are typically employer funded. That means the employer is putting in money, which is great. So the amount folks get in retirement depends on wages earned and how long they worked for the company or, in this case for our listener, a municipality.

Then upon retirement, someone who has access to a pension, they get payouts, typically for life. You generally do have to work at an organization for a set amount of time to get full access to the payouts. That’s called being fully vested. But once you’re fully vested, you can leave that job and still get access to the pension benefits upon retirement. So, so cool. I really wish I had a pension. Now, like I mentioned, pensions are really rare nowadays. So again, pensions are a very sweet benefit to have, and I would think very hard about losing that, especially if you’re not fully vested.

Liz Renter: Yeah, absolutely, Sean. And the listener wrote in about putting a dollar figure on their pension. So I just want to know that that’s an extremely difficult thing to do without a lot of details, and a lot of time, and a big spreadsheet and a calculator. Anyways, when you’re thinking about how long you’ve been at a job, how much your employer’s putting in, what the specifics are about vesting and if you decide to leave that government job, to leave your pension, and what would it take to create something comparable yourself? So there’s a lot of numbers involved, a lot of time frames, a lot of assumptions. So this is one instance where we would say, “If you really want to get precise on that measurement, it might make sense to consult with a certified financial planner who can put the dollar amount on those things.”

Sean Pyles: You’d likely want to talk with a CFP who maybe has some gray in their hair and who has done this before since figuring out pensions can be so complicated.

Liz Renter: Right. Yeah, exactly.

Sara Rathner: And honestly, if you have a financial planner that you already have a working relationship with, I mean, job hunting is an excellent time to have a check-in with them in general, and they might even help you wade through competing job offers or even just the comparison of a job offer to what you’re currently working in. And they can help you work through all the financial considerations of those options. And so that is a great way to utilize their assistance.

So let’s get to the other part of a listener’s question. The mushier stuff that folks should consider if they find themselves itching to leave a job. To start, they should ask themselves, what’s behind this urge? Are they bored, unhappy, unfulfilled? Are they upset because there’s no cold brew in the break room and they really want that?

Liz Renter: Yeah, this is key, Sara. I think there’s so many considerations when you’re thinking about a career move. And I had two really major career changes in my younger years. It’s over the past 20 years, but they were really pretty close together when I was in my late 20s. One when I moved from state government to private industry, and then a few years later, I went from private industry to self-employment. So those are pretty big changes. And in each of those changes, I was weighing different motivations. In one case, it was more about the money and advancement, and in the other case, it was more about what’s really going to make me happy long term? And so I think really diving into why and what your motivations are for leaving or staying, and getting clear on those before you start weighing your options, is a good place to start.

Sean Pyles: To what extent did you have that conversation with yourself or maybe with those around you around, “OK, if I leave this job, I might be making a little bit less, but I will be that much happier.” Or, “If I go to this job, I’ll be making a good amount more, but it’s going to be a boring job.” How did you think about those things?

Liz Renter: It’s tough. I probably had limited discussions. So as a single mom, it was just me and my daughter at the time, who was probably 4 when I made the first job change, maybe 7 when I made the second job change. So there weren’t a lot of people for me to toss these ideas around with. And I’m an extremely private person, but these were conversations I was having with myself. And in the first job going from state government to private industry, I realized in state government that, yes, the paycheck is steady, the benefits are nice, but I really love to work hard.

And in my experience, this government job, you were rewarded for how long you were there, not how well you were doing. And that was tough to deal with, and it really bred apathy among the people around me. I wanted to be somewhere where I could work hard and that would be recognized. So that’s not to say that all government workers are taking naps at their desk. That definitely wasn’t my experience, but personally, I wasn’t being recognized for the hard work that I was doing, and that was really important to me.

Sean Pyles: Right. That makes sense.

Liz Renter: And so that one was really more about the professional rewards of working. And then the second one, it was more about the trade-offs. Am I willing to give up some of those professional rewards to really fulfill my personal life? So as I said, my daughter was really young at the time, I was dropping her off early in the morning, I was picking her up after work, sometimes 12 hours later. And the job was paying more than my state government job, but I definitely felt like I was punching a clock and I wasn’t fulfilled, and I totally could not see myself doing that for years upon years. And I knew leaving that job meant I would absolutely take a decrease in pay, at least in the short term, as I got on my feet as a self-employed freelance writer. But when I balanced that against what was really important to me and what was going to make me happy and make me feel good about the way I was living my life, it was a no-brainer.

Sara Rathner: Yeah. I’ve known people who’ve switched jobs out of boredom and ended up regretting it, actually, because the reason they were bored at their previous job was they’d done it for a while and it became rote. But they realized leaving for a greater challenge meant giving up maybe some of the work-life balance and predictability that came with a job that was quote, unquote, “boring,” and they had to make pretty big structural changes to how they operated at home with their household, with their family, to accommodate the new challenges of a new career.

Sean Pyles: Kind of goes back to the idea that it’s not what decision you make, it’s what you do with the decision that you make. If you do leave a job that you’re bored at and you find that your next gig isn’t quite what you wanted it to be, there are going to be other opportunities later on.

Sara Rathner: Yeah.

Liz Renter: I think that’s a good point. When I went into freelancing and I knew I was going to take a pay cut and I was banking on turning that around in a year or two, I always had that in the back of my head like, “OK, worst-case scenario, I’ll get a part-time job for when my daughter’s in school,” or, “Worst worst-case scenario, I’ll go back to working full time.” With a reassessment of maybe I find something that’s closer to home so there’s less of a commute, what have you. But I think knowing that, “OK, I’ve thought through why I want to do it. I know this is the move I want to make, but just in case, I have these outs and these would be perfectly acceptable if things didn’t work out once I make this decision.”

Sean Pyles: Yeah. And I think your experience demonstrates how important it is to think through various scenarios. What could you fall back on if you do need to make a change after this job switch maybe doesn’t pan out how you thought it was going to.

Liz Renter: Right. I think if you’re planning well enough in advance, if you’re sitting around listening to this podcast thinking about, “Well, I’ve been thinking maybe I’m not happy where I am and maybe I should be considering this,” now’s a great time to make sure that, and I know we talk about this a lot on podcast, but make sure that your emergency fund is in place. Maybe cushion it a little bit more. You want to set these guardrails for, OK, sometimes we make decisions with what we think is all the right information and it turns not to work out the way we expected. So if you have those extra guardrails up, just in case, it can make you feel more secure moving forward with your decision when it’s time.

Sara Rathner: Yeah. And keep your professional network warm. Because it is a risk to take a new job, and sometimes you take a new job and hate it immediately, and you’re like, “I’m just going to job hunt again.” And so by keeping that network warm, by staying in touch with old co-workers or friends or relatives who maybe have some professional connections that would be helpful to you, you still also have an out. Not just financially, but also professionally where you’re still open to hearing about opportunities. Because if the jump that you made ended up being a pretty bad bet, then you’re still pursuing other places you could go and you haven’t closed off all the doors to that.

Sean Pyles: Well, now I want to talk about the counterpoint. About when it actually might be a good idea to stick around at a job. Conventional wisdom, at least among millennials, is that you shouldn’t stay at a job for too long because you’ll probably be able to earn more money going to a different job after a couple years. But sometimes staying at a job for potentially several years can be the best choice for people. So let’s discuss that. Liz, you’ve been at NerdWallet nine years, so what’s kept you around and how do you think about that sort of equation?

Liz Renter: So it’s interesting to think back at how this has changed over the generations because, definitely my grandparents to a certain extent and a little bit my parents as well, those generations you were rewarded for just staying where you were. You get a good job with good benefits and you don’t leave for 50 years, and then they throw you this big party. And that’s changed over the years where there’s more mobility and we can experience different opportunities. And I think there’s room for both of that. A little bit of each. So if you are the type that really wants to be loyal to a single company and wants that stability and you’re happy with what you’re getting paid, you don’t have to keep chasing 5% salary increases at other companies. That’s not a requirement. If you’re good where you are, you like your work and you’re working towards your long-term financial goals, that’s totally acceptable. You don’t have to get in on this hustle life.

Sean Pyles: That can also be a good way to approach things, given that the macroeconomic conditions right now are a little shaky. Many companies still have the policy of last in, first out when it comes to layoffs. So for this year in particular, it might not be a bad idea to stick around if you do like the job that you have.

Liz Renter: Right. People are still leaving their jobs at really high rates, but they’re getting into new jobs at really high rates. The unemployment rate hasn’t ticked up, which means people that are leaving their jobs aren’t filing for unemployment, they’re going elsewhere. So that’s a positive sign if you do want to change jobs. But to your point, Sean, there is a lot of uncertainty, and if you’re risk intolerant, it might make sense to sit tight for a while and see how things shake out.

Sean Pyles: Well, Liz, do you have any final thoughts for those who might be thinking about switching jobs right now?

Liz Renter: I would say, yes, it’s as complicated as you think it is. I envision it as you’ve got all of these scales in front of you that you’re trying to balance and you’re trying to figure out, “OK, if I take away this much of my work-life balance, how much salary do I have to add to make it worthwhile?” Or, “If I take away the cold brew in the kitchen, how much of a cell phone stipend do I need to add to make it worthwhile?” So there’s all these scales you’re trying to balance here, and it’s a lot to think about. So you just do the best you can, set up some guardrails just in case things don’t go well.

Sean Pyles: And maybe take your time making a decision. Don’t rush into anything too hastily. Otherwise, the scales may just collapse and go crazy.

Liz Renter: Yes, absolutely. That’s perfect, Sean.

Sean Pyles: All right, well thank you so much for talking with us, Liz.

Liz Renter: Thanks for having me again.

Sean Pyles: All right, and with that, let’s get into our takeaway tips. Sara, will you please start us off?

Sara Rathner: Sure. First, know what you’re getting. Compensation can include a lot more than the cash you get. Understand your total compensation ahead of any job hunt.

Sean Pyles: Next up, go beyond the math. Jobs are about a lot more than the money. Consider things like personal fulfillment and work-life balance when weighing other job options.

Sara Rathner: Finally, there’s nothing wrong with sticking around. If you’re fulfilled and well compensated in your current position, staying put might be your best option.

Sean Pyles: And that is all we have for this episode. Do you have a money question of your own? Turn to the Nerds and call or text us your questions at 901-730-6373. That’s 901-730-N-E-R-D. You can also email us at [email protected] Visit nerdwallet.com/podcast for more info on this episode. And remember to follow, rate and review us wherever you’re getting this podcast.

Sara Rathner: And here’s our brief disclaimer. We are not financial or investment advisors. This nerdy info is provided for general educational and entertainment purposes and may not apply to your specific circumstances.

Sean Pyles: This episode was produced by Liz Weston, Tess Vigeland and myself. Kaely Monahan mixed our audio. And a big thank-you as always to the folks on the NerdWallet copy desk. And with that said, until next time, turn to the Nerds.

Source: nerdwallet.com