Even though more womxn are working and earning higher salaries than ever before and breaking glass ceilings all over the damn place, we’re still behind when it comes to retirement and investing—yet we live longer than men do. So what gives?
Well, a lot of the womxn I know in my life feel like they have time to wait, they can invest later when they have more available cash, after they save for a wedding, or after they pay off student loans or credit card debt. Or it’s just not that important right now. Even worse is my biggest pet peeve: that they can rely on their spouse’s 401(k). In other words, they’re contributing to their spouse’s retirement for THEIR future. Well, I’m here to tell you that in most cases, you’re wrong.
You need to be investing what you can, right now. Not only for your future self, but for your present self. So you can change things in the world, literally put your money where you mouth is (or values are), and invest in ESG or SRI stocks (aka, socially, environmentally, and ethically conscious investments). Plus, if you walk away from a marriage or a relationship, you need to have your own damn money to fall back on. Yes, you can have a healthy relationship while still prioritizing your own financial well-being.
And if you’re over there thinking you’ve got it all figured out because you have a good chunk of money in a savings account, kudos. Money in savings is a GREAT first step, but even in the highest interest savings account you can find, your money is still worth less with each passing year. The only way to combat that decreased buying power is by investing that money in something that beats the rate of inflation (which has been an average of 3.22%/year).
First, I’m going to define a few important terms I’m going to use throughout this article:
Compound Interest/Compounding Returns: Interest/returns paid on both the principal balance and on accrued interest/gains.
Retirement Accounts (SEP IRA, Roth IRA, 403b, 401k, Traditional IRA, etc): A plan for setting aside money to be spent after retirement. For the purposes of this article, the retirement accounts I refer to are all qualified retirement accounts per the IRS. Some of them help you pay less in taxes now (SEP/Traditional IRA 401k), and some help you pay less in taxes later (ROTH). For these accounts, you can’t take your money out without incurring a 10% penalty before the age of 59 ½. This is to incentivize you to keep your money in here, and not touch it until you’re actually retired (and also why I recommend also having savings accounts and non-retirement investment accounts).
Investment/Investment Account: A type of account that is post-tax, doesn’t have any long-term retirement benefits, but money can be withdrawn at any time, regardless of your age.
Inflation: A general increase in prices and fall in the purchasing value of money.
Why You Need To Invest
We’re going to talk about compound interest here for a minute. One of my strongest beliefs is that you should get retirement and investment accounts set up first, followed by a savings account. That’s because your retirement and investment accounts will generally give you an 8% average return over a 10-year period.
Now we’re going to do some math (I know, but trust me, it’s important).
If you’re 25 and invested $5,000 now, contributed $100/month to retirement for the next 40 years, and retired at 65, you’d have somewhere around $470,467.71. If you waited until you were 30, invested $5,000 and contributed $100/month for 35 years and retired at 35, you’d have $310,851.00. That’s a difference of almost $160,000, and the amount invested only decreased by $6,000 (5 years of $100/month).
Even crazier, if you’re 20 and invested $5,000, contributed $100/month for 45 years, and retired at 65, you’d have around $708,271.99!!
So when I tell you that compound interest is important and that investing something now is better than investing a larger amount in a few years, trust me on it.
How To Invest
Invest in yourself and your future right now, even if it’s only five dollars a month. Something is better than nothing, and like I talked about above, compound interest is your friend when it comes to taking care of your future self.
If you have a retirement plan offered through a job, you can start now by:
Opening a retirement (or multiple) accounts (if you don’t have access to one through a job).
If you have one through your work, you want to contribute to both a ROTH and regular option. ROTH contributions help future you with taxes, and regular/traditional pre-tax options help you with taxes.
If you’re self-employed or don’t have a retirement plan offered through a job, you can start now by:
Opening two types of retirement accounts: a ROTH and a Traditional IRA (or a SEP IRA if you’re self-employed).
You want to open and contribute to both types of accounts because post-tax ROTH contributions help future you with taxes, and regular/traditional pre-tax contributions help you now when it comes to taxes.
Whether you have a retirement plan offered through your employer or not, I recommend splitting your pre- and post-tax contributions 50/50, so if you can set aside $50/month for now, I’d send $25 to a ROTH and $25 to a Traditional account. I also recommend opening an investment account, then a savings account. I like Ellevest and Betterment.
That’s it. Your step-by-step guide to starting investing today (in like 15 minutes). You’re worth it, and the world needs more womxn investing and taking control of their financial future.
Images: Startup Stock Photos / Pexels
This pandemic is a totally scary, unprecedented time in all aspects of our lives, including finances. Businesses are closing their doors, employees are getting furloughed or laid off, the stock market is plunging (or so I am told by my dad)—if we weren’t worried about our finances before, we certainly are now. During this heightened time of stress, many are struggling to figure out what they can do to ensure financial security. Our advice? Don’t check your 401(k) for a while… it’s only going to make you freak out even more. And to help put your mind at ease and give you tips on actions you can take to protect yourself, we spoke to Ken Lin, CEO of Credit Karma, about what you should be doing, and the types of mistakes to avoid.
1. Know Your Options
The situation we’re in is a weird one that no one saw coming (well, except the world leaders who were warned about it and tried to ignore the problem, thinking it would go away, but that’s neither here nor there). An important thing to keep in mind is that banks realize we’re in a f*cked up situation right now and may offer you a new plan in response to what’s happening. Lin advises to take matters into your own hands and “call your credit card issuer, as they may offer a hardship plan, which sometimes offer lower interest rates, smaller minimum payments and/or lower penalties.” I’m sure the last thing you want to do now is get on the phone and wait on hold, but you have the time, and it could help you a lot, so just do it.
2. Pay The Minimum Amount Due If You Can
If you aren’t getting paid your usual salary, your hours have been cut, or you’ve been laid off or furloughed, you may be freaking out about paying your credit card bill in the next few months. While it’s usually best to pay in full each month, Lin says, “during times of stretched income, try and pay just the minimum payment to help you avoid late fees or dings to your credit.” The good news is that issuers typically won’t report the late payment until it’s 30 days past due, so you may have a bit of wiggle room. Lin explains, “If you can make your payment before the 30-day mark, you may not have to worry about the late payment being added to your report.” So if you can afford to make that minimum payment, even if it’s a couple of days late, it can save you stress and may not incur late fees, but just make sure you double-check your credit card details.
3. Don’t Default To Swiping Your Credit Card
I don’t know who needs to hear this but STOP online shopping during quarantine… oh wait that’s me
— Linsey Meister (@linseyx5) March 25, 2020
You may want to make purchases on your credit card in order to make ends meet, but there might be better options out there. Lin advises, “If you’re looking for an alternative, often times personal loans will have lower interest rates than credit cards.” He also offers that before you swipe or open up an additional line of credit, you take note of the interest rate on your credit card and make sure you’re not accruing additional interest and fees.
4. Think Twice Before Taking Out A Payday Loan
Before you borrow any money, take a nice hard look at the fine print. Lin cautions, “Payday lenders tend to prey on those in desperate circumstances like these, and these loans can be the beginning of a long cycle of debt.” He advises holding off on these types of loans, as “a payday loan may carry unfavorable terms, including high fees and interest rates.” The best thing to do, he says, would be to look into other options available to you, such as emergency or personal loans.
We’re all feeling all kinds of emotions right now, but it’s important you take care of yourself, and part of taking care of yourself is making sure your finances are in check. Trust me, everyone is in the same boat. When in doubt, look into your options and talk to someone on the phone. There may be solutions there you haven’t thought were possible.
Images: Sharon McCutcheon / Unsplash; @linseyx5/Twitter
April 17 is officially the worst day of 2018. No, the pee tape didn’t leak; it’s motherfucking tax day. It’s a day when even the most commie pinko liberal SJW becomes a wingnut constitutional originalist. It’s also a day when we’re reminded (ad nauseam) of how much money the scumbag tax prep companies spend to keep our tax code complicated as shit. Coincidentally, if you’re reading this by the time it’s published and haven’t done your taxes yet, it means something else: you done fucked up. Luckily, the entire reason I got harassed into writing this was to explain what to do if you missed the tax deadline (or just fucked them up).
The good news is that it’s not all gloom and doom. Even if you hit the unholy trifecta of a) being late as shit, b) owing money and c) making dumbass mistakes, you’re probably ok. The IRS isn’t going to repossess your grandma’s house, and the jackbooted brownshirts aren’t coming to throw you into debtors prison. I mean, I’m also definitely neither a lawyer nor an accountant, so I guess those things could happen. More likely, though, one of the following (decidedly less threatening) scenarios apply to you.
What To Do If You Missed The Tax Deadline
Scenario 1: You’re Expecting A Refund
This is undoubtedly the best scenario for people who read this website, because you don’t have to do shit. Well, almost shit. If (like most Americans) you overcook your withholdings on your tax forms during the year (and you work an hourly or salaried job where taxes are automatically withheld), you’re probably owed a refund by the IRS. In that case, all you have to do is file them by November—no special extensions required. You see, the IRS has already held onto your money (interest-free!) for the better part of a year, and they’re happy to continue to do so. They won’t even charge you a penalty!
The only caveat is if you don’t e-file by November, you have to mail them in. I’d bet good money ($5) that 50-60% of our readers don’t know how to address an envelope at this point, so don’t let it get that dire.
Scenario 2: You Owe Money
Option One: File And Pay ASAP
LMAO you’re fuccccccckkkeeeedddddddddddddd. Jk, you really aren’t. But the bad news is, you can no longer file for an extension that would have bought you until November to get your taxes filed. Your best bet is to file ASAP to avoid the penalties and interest the IRS will gleefully throw at you. (Note, again, that you get no such recompense when they’re holding onto your money.) File now, pay your bill, and honestly nothing bad will happen to you outside of some (honestly pretty reasonable) fees. You can use the government’s online forms or whatever soul-sucking tax prep software you prefer. If you made under $58,000 last year, you can file your federal taxes 100% free through any service.
Wait, what’s that? You owe a lot more money than you have because you’re incredibly financially irresponsible? Ugh, you’ll still be ok. Step one is still to file ASAP, and to pay as much as you can upfront. If it takes you another paycheck or two to make up the rest, you won’t be out that much. But if you’ll need a lot more time than that (where the fuck does all of your tax-free money go, anyway?), you can set up a payment plan with the IRS. There will still be penalties involved, but they’re a lot less squirrely when they know when the money will be there. Note that you can’t do this, like, every year.
The good news is that this does not apply to the majority of workers, usually only contractors and others who receive 1099s instead of W2s. That’ll eventually be most workers if companies like Uber get their way, but not yet. Yayy gig economy!
Option Two: Become A Sovereign Citizen And Go Off The Grid
If you think about it, have you ever really read the Constitution and all of its amendments? I reckon that you have not, but there’s a nonzero part of the population that has, and an even nonzero-er portion of those people interpret it to mean that the government doesn’t actually have the right to tax you. Are these people insane? Fuck and yes, they’re insane as hell, but you have to admit that there’s a certain charm to living in Bumfuck, Oregon and shitting in an outhouse. So refreshing! You just have to get used to carrying a gun at all times and yelling “TAXATION IS THEFT AND THEFT IS VIOLENCE” every time you pass a cop.
What To Do If You Made A Tax Fuckup
Scenario 1: The IRS Rejects Your Return
So you filed on time, which is good! V responsible of you. But then, seemingly out of nowhere (read: like 24 hours after you clicked “file” in TurboTax), you get a harrowing message: The IRS has REJECTED your vile, no-good return! This sounds like the audit police are about to bust in and give you the Michael Cohen special, but fear not—they just need you to fix your obviously wrong shit. Your tax filing software (whether you do it through the government or otherwise) will tell you where you messed up. In this situation it’s a glaring, easily fixable error; like forgetting to claim any income or trying to write your Sephora points off as a charitable donation. Oops!
Scenario 2: The IRS Accepts Your Return
While this may sound better, it’s actually… not, somehow? That’s only because you have to play the waiting game, though. If the IRS accepts your return with something you know is wrong, that means you have to wait until it’s processed, and until you receive your return (if you’re expecting one) before filing an amended return. If you already owe money or made a mistake that could cause you to owe money, on the other hand, you should file that shit ASAP. And don’t worry about the little shit: The IRS will correct your math mistakes on their own, and they’ll kindly let you know if you’re missing any forms or schedules.
Finally, don’t worry too much about a mistake leading to an audit, even a kind of big omission. You want to know the biggest red flag for IRS auditors? Making more than $200k per year, which quadruples your chances. Otherwise, unless you’re just straight up not reporting all of your income (they receive the same forms you do, you know..), you aren’t worth the trouble.
Heads up, you need to keep up with the news. It’s not cute anymore. That’s why we’ve created a 5x weekly newsletter called The ‘Sup that will explain all the news of the week in a hilarious af way. Because if we weren’t laughing, we’d be crying. Sign up for The ‘Sup now!
Images via Giphy (3)
2017 was a shit year for almost everything (our democracy, Rob Kardashian, etc.), but it was a great fucking year for Bitcoin. So if you’re hoping that 2018 is the year that Trump gets indicted you get rich without having to try very hard or even be good at your job, then you might want to think about investing in cryptocurrency. Because anything that can come out of 2017 looking better than it did during the pre-Trump era must be pure fucking magic.
Yes, cryptocurrency is still new, and no, we aren’t entirely sure how it works—but 2018 should be about trying new things, like vegetables or not blacking out. So why not spend less of your paycheck on booze and more of it on your (potentially) richer future? And while it may be too late to get in on Bitcoin, it’s just the right time to bet on its earlier stage crypto alternatives. So if you feel like taking a risk in 2018 (and taking financial advice from a freelance pop culture writer), consider getting in on one of these babies.
1. Ethereum
As the third largest cryptocurrency out there rn, Ethereum is catching up to Bitcoin like Dave Franco’s career is catching up to his brother’s. Companies are betting on it because it’s also a computer network with enough power to store all the world’s secrets transactions. It’s so popular that everyone wants to sit with it other currencies are being built on top of its network (IDK what that means, but it sounds fancy), and it’s grown almost 100x in the past year.
2. Ripple
Number two on the crypto market and still cheap af (≈$2.50 each), Ripple has grown 375x this year and buys/sells faster than both Bitcoin and Ethereum (no more of that “your deposit will hit your bank account in three days” bullshit). Banks/governments are Ripple’s #1 fans because it’s somewhat centralized—meaning they can bet on crypto while not giving up control. Downside: the whole point of cryptocurrency was to decentralize the economy, so like, Ripple is kind of the Judas of cryptocurrency.
3. Bitcoin Cash
Bitcoin Cash was created from a fork among the OG Bitcoin nerds developers. I assume the breakup convo went something like this:
Bitcoin Cash nerds: We should make Bitcoin better, like with faster and cheaper transactions.
Bitcoin nerds: Nah dudes, we cool.
Bitcoin Cash nerd: Well fine then, we’ll just make our own.
And then one day (August 1, 2017) everyone who had Bitcoin woke up with an equal amount of Bitcoin cash. It was like a surprise buy-one-get-one-free sale, but the thing you got for free is now worth almost $3,000.
4. SALT
Remember like, 100 words ago when I said you can build currencies on top of Ethereum? Well, this is one of those. In addition to making all foods taste better, SALT is a currency/loan platform where you can take out a loan against the value of the cryptocurrency you own. It’s like a crypto credit card but instead of your personal information being stolen by an Equifax credit check and subsequent info breach, they just make sure you’re good for it. It’s a newbie and currently selling for ≈$12.60 a piece.
5. Monero
Most cryptocurrencies have a public ledger (transaction history) where anyone (like Trump, for example) could find out how deep you’re rollin’ in digital monies. But Monero is completely private. You can buy, sell, or trade this ish and no one will ever know. Okay yes, it sounds a little sketch. And sure, it’s v popular on the drug market. But if you want to keep your wealth on the DL so your dates keep paying for dinner, Monero is the secret currency for you. It’s also grown 30x in a year, so your secrets could get real big.
Not convinced? I don’t totally blame you. But why not buy like $20 worth of one of these coins and see what happens? (I’m riding the Ethereum, Bitcoin Cash, and SALT trains). Worst case scenario: you eat leftovers instead of takeout for one night. Best case scenario: You get fucking rich (well sorta—it’s only $20).
It’s not chic to talk about money if you have money, but it’s also very unbetchy to get ripped off. You’re so lucky you have us, because we did the research on things you’re overpaying for. I know, we’re such a good friend. Like, did you know that when you buy tampons you have to pay a luxury tax on top of regular sales tax? As in, using a tampon is like a luxury. Yes, we know we’re so blessed to not be pregnant every month, but calling tampons a luxury is a stretch. Not to mention, at like $8 a box for the non-shitty cardboard kind, tampons are already priced as a luxury so what gives? Anyway, here’s the top five ways the fuckboys of big businesses are ripping you off. Just because you hate doing work doesn’t mean you don’t deserve to keep all the money you didn’t work (that hard) for, so hang on to your cash and stop overpaying for shit.
5. Razors
Remember when Venus first came out and we were all singing the catchy song from the commercial? Those bright pink and blue razors were so pretty we didn’t even notice that we were being charged more for razors than men that literally do the same shit. Literally we are paying for pretty colors. Like the nickname for it is “the pink tax”. Female razor costs a few dollars more than men’s almost always, and the only difference is the way it’s marketed. LITERALLY. Don’t let that “soap strip” or whatever the fuck fool you—your sparkly pink razor is not getting you a better shave. In fact, most men’s razors work better, because they’re designed to get rid of bros’ hair and bros just have thicker hair. So even though it might feel like you’re showering at a frat house, you should buy a man’s razor and stop paying more for a shitty pink one. And honestly, any fuckboy who sees a men’s razor in your shower is bound to get jealous thinking you’ve got another guy in your life, and this will make him try harder. So it’s a win for you, your wallet, and your legs. I see no downside here.
4. Handbags
This one kills us too. Saving up for your first Kelly Bag was a rite of passage, like getting your period or dating your first older bro. But the truth is, even with the nicest leather and hand-stitching or whatever, you’re still paying way too much for handbags. Just the idea of having dozens of bags because you can’t wear the same one everyday is something that bros don’t even have to worry about. They literally put their shit in pockets, which we could do if we weren’t so skinny that pockets don’t work for us. But even though our figures are too tight for storing keys, wallet, phone, we could potentially still own considerably less purses than we do. According to this bro blog, a genuine leather bag on the high end costs $100-$150. Which we laugh at because that wouldn’t even buy a clutch at an accessible brand like… ugh, Coach. Anyway, you’re paying too much for bags. Like you could own several cars if you stopped buying bags. But you’re not going to, obvs, and we totally understand.
3. Dry Cleaners
Your dry cleaner charges more for betches than bros. Like if you bring the exact same shirt to a dry cleaners but one is a female version and one is a male, the female one will cost twice or even three times more. Dry cleaning companies claim that it’s because the female shirts don’t fit in their machines, but the truth is women will pay the higher price for clothing care and men won’t. And everyone is sexist and the world is a terrible place, bye. It goes even deeper than cleaning clothes, though. Men’s clothes are priced lower than women’s in general. Plus we shop way more than men so we’re buying at least twice as much shit on a regular basis. Ugh, we feel used. At least female models make way more than male models, so we get a win there. Maybe try having your boyfriend drop off your dry cleaning and see if they charge you less. IDK.
2. Travel
If you’re a betch that procrastinates as most of us do, you probably end up paying more for your airline tickets because you book them closer to when you need them. If you really want to get a good deal on airline tickets, you need to set flight deal alerts on websites that do that, so someone tells you when the flight you want to your destination is lowest. Like, you can get round trip tickets from LA to New York for under $300 but you have to know when to look for them. Some websites say the best time to buy a plane ticket is 57 days out from your trip, which seems a little close but I’ll trust it. And forget everything you heard about the best day of the week to buy plane tickets being Tuesday—it’s actually Sunday, so you can quit trolling Kayak at work. Or you can just try booking your flight through United—if you’re down with being assaulted we bet you could probably get a really good deal right now.
1. Everything At Whole Foods
Whole Foods is basically a day club if you think about it. There might not be a doorman letting people in, but if you’re not wearing the right clothes (aka like you just came from yoga or SoulCylce), you’ll still feel out of place. Bananas at Whole Foods cost an average of 99 cents a pound, while they cost 70-80 cents everywhere else. Essentially, you’re paying way too fucking much for everything at Whole Foods. Like, a lot of the shit they have there is the same supplier as other grocery stores in the neighborhood, so you’re literally just paying more to be able to tell people you’re bougie af with your groceries. If you want fresh fruit and vegetables without spending half your alcohol budget paycheck, go to the farmer’s market or literally anywhere else.
