This student debt strategy can save you more than $18,600

More than 8.5 million Americans are enrolled in income-based repayment plans that can spread out payments for their federal student loans for two decades or more.

While the repayment plans lower the monthly payments of borrowers, these plans do not reduce the interest rates on student loans and can increase the total amount of interest borrowers pay over time.

Borrowers with good income and credit are using another strategy: student loan refinancing. This means taking out a loan with a private lender, usually at a lower rate, to pay off the debt on the federal loan. Borrowers save more than $18,600 by reducing the rates on their student loans by an average of 1.7 percentage points through refinancing, according to, a marketplace of online lenders.

The savings from student loan refinancing do come with some drawbacks.

Borrowers who refinance with private lenders can’t take advantage of income-based repayment plans and public service loan forgiveness provided by federal loans. Though some private lenders offer forbearance if borrowers can’t make their payments, the benefits aren’t as robust as those with federal loans.

“Student loan refinancing is giving up an insurance policy from the federal government. If you don’t need it and are comfortable with the risk, you can save thousands,” said Nick Clements, co-founder of price comparison website, which tracks private lenders that provide student loan refinancing.

More from College Game Plan:
Trump’s budget seeks to eliminate one major benefit of federal student loans that costs billions
Three ways to avoid the financial death spiral of defaulting on your student loans
The 3-minute tool to calculate your actual college costs

High-income borrowers with six-figure loan balances are being aggressive about paying off their student debt. Fifty-four percent of borrowers who refinanced more than $100,000 in student loan debt had loans with repayment terms of 10 years or less, according to Credible. (The standard repayment term for federal student loans is 10 years.)

Law, pharmacy and medicine were the most common graduate degrees held by high-balance borrowers refinancing loans, according to Credible. These borrowers earned $126,192, on average, and refinanced loan balances averaging $150,511.

You will need an excellent credit score to get the best deals with student loan refinancing. Eighty-four percent of high-balance borrowers who used Credible had credit scores of 740 or above when they refinanced. (Credit scores range from 300 to 850 and the average FICO score is 699.)

“It’s not just for the HENRYs [high earners, not rich yet], you can refinance your student loans with a credit score as low as 620 if they have a co-signer ,” said Stephen Dash, founder and CEO of Credible.

What you need to refinance

It pays to shop around for the lowest rate with student loan refinancing.

Fair Isaac Corp., which calculates and sells FICO scores, said rate shopping for student loan lenders will not affect your credit score as long as you do it within a 30-day period.

Here’s what to know when you’re looking to refinance your student loans:

  • Geography and cash flow matter. Someone who is making $60,000 a year in Omaha, Nebraska, would likely be viewed more favorably by lenders than someone making $60,000 in San Francisco. Lenders also will evaluate borrowers’ living expenses, not just income. So the better you budget, the better rate you may receive.
  • If you missed any payment in the past, you probably won’t qualify without a co-signer. Borrowers who recently graduated may not have the best credit scores yet. However, it’s more important to show lenders that you pay your bills on time.
  • Know the trade-offs between fixed- and variable-rate loans. Currently, lenders are offering fixed-rate loans starting at 3.38 percent and variable-rate loans as low as 2.58 percent. The rate on a variable-rate loan will rise and fall based on a market benchmark, in most cases, the London Interbank Offered Rate .
  • Avoid origination fees. Most lenders don’t charge origination fees for student loan refinancing. If you find one that does, move on.
  • Sign up for automatic payments. Many lenders offer a 0.25 percent interest rate discount if borrowers automatically deduct student loans from their bank accounts.

The Savings Rate Method of Retirement Planning

When it comes to saving for retirement, one of the toughest parts is determining how much to save. Plenty of online calculators allow savers to set goals, and professional financial planners have their own methods for determining target numbers for clients. These options for calculating your retirement number are helpful. But there’s one hitch: They often depend on your best guesses about events that are far in the future.

[See: How to Save $1 Million by Retirement.]

Many aspects of retirement planning require an educated guess. For instance:

— How much will you spend each year of retirement?

— How many years do you expect to live?

— At what age do you plan to retire?

— Will you pay off your home during retirement?

— Will you live in your current location or somewhere cheaper or more expensive?

— How will the market perform, on average, over the next two decades?

Some of these questions are impossible to answer, and your responses might also change over time. But you don’t need to know the answers to all of these questions to build a nest egg for the future.

[Read: How to Get a Good 401(k) Match.]

Select a savings rate. Instead of focusing on a far-away goal of saving $1 million or more by your desired retirement age, you can set monthly or annual savings goals. It’s possible to cut through the complications of your retirement goals by focusing on your current savings rate. Here’s how this savings strategy works:

1. Make concrete savings goals. It’s no secret that Americans have trouble saving for retirement. Some of the problem is likely that retirement seems so far away. Sure, you want to save a million dollars, but it’s easy to delay saving when you have 30 or 40 years until retirement. Focusing on saving a set percentage of your income each year forces you to think in immediate terms.

2. Lower the bar. One way to calculate future retirement needs is by estimating your retirement expenses and multiplying your annual expenses by the number of years you expect to be retired. But it’s tough to estimate your expenses 30 years into the future. Setting a savings rate goal of at least 10 percent of your salary — but preferably 20 percent or more — teaches you to live on less money right now, and you can continue that frugal lifestyle in retirement.

3. Save more quickly. If you look at a retirement calculator with standard inputs, such as average rate of return and annual income, you might find that you can get away with saving less than 10 percent per year. By setting the bar high with a savings rate goal, you’ll save a large balance more quickly, so you’ll reach your savings goal much sooner.

[Read: How Long Does it Take to Vest in a 401(k) Plan?]

Don’t only use this method. The savings rate method is an excellent option for young savers. The younger you are, the more difficult it is to determine what your financial needs will be in retirement. So instead of estimating retirement expenses that could change, focus on saving at least 10 percent of your income, preferably more.

As you get closer to retirement, then you may want to use more complex methods to set your retirement savings target. You may find that you want to increase your savings rate to allow for a more luxurious retirement. Or maybe you’ll find you’re on track to retire sooner than you planned.

The savings rate method is a great way to begin to save for retirement. Then as you move closer to retirement, you can use more complicated methods to refine your retirement savings needs.

How are you taxed after selling a mutual fund in a Roth IRA?

A:Once money is invested into an individual retirement account (IRA) or a Roth IRA, there are no tax consequences for trading securities within the account as long as the money remains in the same account. With Roth IRAs specifically, contributions are taxed at the holder’s current ordinary income rate before the deposit is made. Once the money is invested in the account, capital gains and income are not taxed. Distributions from Roth IRAs are not taxed once they are withdrawn from the account, either. Those investing in various mutual funds, stocks and other securities often wonder about the tax consequences of trading within their accounts, as they may want to switch investments but fear owing money.

Suppose a mutual fund in a Roth IRA account has grown to $100,000 and is sold. Due to the sale event, the mutual fund realizes a long-term capital gain of $20,000. No tax liability is generated, and the full $100,000 can be invested in another security or left in cash. This holds true for traditional IRAs as well, though distributions from these accounts are taxed at the holder’s ordinary income tax rate. If this example sale occurred in an individual brokerage account, the $20,000 long-term capital gain would be subject to the investor’s long-term capital gains tax rate. If that rate were 15%, then a tax liability of $3,000 would be due and the investor would have the remaining $97,000 to invest in other securities.

A:Once money is invested into an individual retirement account (IRA) or a Roth IRA, there are no tax consequences for trading securities within the account as long as the money remains in the same account. With Roth IRAs specifically, contributions are taxed at the holder’s current ordinary income rate before the deposit is made. Once the money is invested in the account, capital gains and income are not taxed. Distributions from Roth IRAs are not taxed once they are withdrawn from the account, either. Those investing in various mutual funds, stocks and other securities often wonder about the tax consequences of trading within their accounts, as they may want to switch investments but fear owing money.

Suppose a mutual fund in a Roth IRA account has grown to $100,000 and is sold. Due to the sale event, the mutual fund realizes a long-term capital gain of $20,000. No tax liability is generated, and the full $100,000 can be invested in another security or left in cash. This holds true for traditional IRAs as well, though distributions from these accounts are taxed at the holder’s ordinary income tax rate. If this example sale occurred in an individual brokerage account, the $20,000 long-term capital gain would be subject to the investor’s long-term capital gains tax rate. If that rate were 15%, then a tax liability of $3,000 would be due and the investor would have the remaining $97,000 to invest in other securities.

Marketing In The Year We Live In: Bluetooth Proximity Marketing Strategies

Think about that for a moment… Every year technology takes a giant leap forward. Thanks to Elon Musk of Tesla Motors, cars can now drive themselves. Steve Jobs gave us these mini handheld super computers affectionately called iPhones dwarfing the performance of the gargantuan room-sized computers of old. Even film cameras have been replaced by smartphone cameras with 12+ megapixels.
The way business owners market their goods and services must change as well if we intend on staying relevant in today’s fast paced environment. What worked 20 years ago doesn’t hold a candle to what savvy business owners and marketers of today do to drive new prospects and sales.
Billboards get little attention nowadays because most passengers are staring at a mobile device instead of gazing at the passing scenery. Most drivers aren’t even looking at them either, to quote Vayner Media’s owner, Gary Vaynerchuk “$hit man, they’re not looking at billboards, they’re not even looking at the f@%king road!”
SO what’s the first thing we do when a commercial comes on TV if you’re not blessed to own a DVR? Most people scoop up their smartphone and check email, Instagram or Facebook. Outside of a 60 second spot during the Super Bowl, no one’s watching your Campbell’s Soup commercial bro. So smart marketers rule out advertising on the boob tube too.
Let’s talk print… I’m 41 and haven’t had a newspaper subscription in 19 years and other than September 11, 2001 – I’ve never bought a newspaper at a stand. Magazines? Fo-get about it. It’s been a decade since I’d happily march to the mailbox excited for my latest issue of Bassmaster Magazine.
As more new cars are coming equipped with Bluetooth connectivity allowing drivers to listen to their iPods or commercial free subscription services like Spotify, advertising on the airwaves of AM and FM stations is so 2002.
Sadly, radio ads are becoming the old way of spreading the word too.
Yes, the old guard is dying.
And a new way of marketing has emerged. Who am I and why should you listen to me? I’ve spent the last 4 years building successful online businesses using SEO, PPC (Pay-Per-Click Advertising) and social media giants like Facebook and Instagram. I’m no stranger to spreading my message, building client’s brands and dominating the interwebs in their industries.
Until recently one of the fastest ways you could reach people geographically was to run a geo-targeted Facebook or Instagram ad to get the word out about your product or service. That’s still a dynamite way of getting eyeballs on your offer but there’s this new kid on the block that’s exploding in popularity.
His name is Bluetooth Proximity Marketing. In essence these tiny little devices, no larger than a silver dollar allow users to send a custom 40-50 character notification with a clickable-link to any Android user with Bluetooth enabled within 100 meters.
The notification can be removed by clicking the link, swiping it away or as the Android user leaves the beacon’s 100 yard range the notification disappears.
Nifty huh?
It’s a digital marketing revolution and only the bold and fast movers will survive.
Some have fought their last battle, closed the doors for good and settled for more stable forms of income by working for others that have it figured out. (For now at least)
Android has a 60% market share in the smartphone category in North America and as times passes more and more people have their Bluetooth enabled. More and more people are listening to wireless headphones while lounging in the park, exercising, conducting phone calls and playing their music through car audio systems than ever before.
I want you to win in the future and the early adopters always seem to reap the biggest rewards of any new technology. I’m hard pressed to think of a business that can’t use one of these notification devices but below you’ll find a list of businesses and Bluetooth Marketing strategies for each of them.
“How You Can CA$H In Big With Bluetooth Proximity Marketing”
It’s important to note that it’s not just the idea of generating new business leads as the main value proposition of using a Bluetooth proximity device as much as the upsell potential for existing customers that are already in your place of business.
I’ll break these two concepts down into two categories: Upsells to existing customers and new lead generation.
Would you like fries with that? Would you like our extended warranty and would you care for a desert are some of the highest revenue generating questions business owners can ask their customers.
It’s far easier to get what I call “second money” immediately after someone just spent money with you wouldn’t you agree? Here’s the list of businesses that could benefit tremendously from Bluetooth proximity marketing.
Coffee Shops
Ice Cream Parlors
Hair & Tanning Salons
Auto Dealerships
ATV/UTV/BOAT/RV Dealerships
Service Based Businesses
Boutique Clothing Stores
Gym, Yoga & Fitness Centers
Festivals & Trade Shows
Famers Market Vendors
ANY Retail Outlet
Even Funeral Homes ¯\_(ツ)_/¯
+ More
Business Specific Notification Ideas:
Restaurants/Bars, Coffee Shops, Ice Cream Parlors:  Have a sign or a mention on your menu with “Check your Android device for special offers!” or “15% OFF when you check your Android notification.” Your clickable link can send them to a webpage so with instructions to simply present the coupon on the page to the wait staff.
Restaurants: Notifications with new menu items, desserts and gift cards offers are the norm.
“Happy Hour Special – Order Now” – YOUR WEBSITE LINK
“Gift Certificates Available – Ask Now” – YOUR WEBSITE LINK
“10 Percent Off All Deserts – Ask Our Staff” – YOUR WEBSITE LINK
“Discount Coupons – Join Our Mailing List” – YOUR WEBSITE LINK
Coffee Shops & Ice Cream Shops: Like restaurants, coffee shop notifications should offer new flavors, sandwich & dessert combos or gift cards.
“Tried Our New Flavors Yet? YOUR WEBSITE LINK
“Need a cup of Joe to go? – YOUR WEBSITE LINK
“Gift Cards Available On Request!” – YOUR WEBSITE LINK
Hair & Tanning Salons: I can’t think of a better way to generate more revenue from a captive clientele than sending a Bluetooth notification to salon customers.
“10% Off Your Next APPT. – Book Now” – YOUR WEBSITE LINK
“TODAY ONLY! – 5% Off All Product” – YOUR WEBSITE LINK
“Tanning Members Save More $$$” – YOUR WEBSITE LINK
Vehicle Dealerships: Most dealers are open, no later than 9:00 PM but the lot traffic doesn’t stop just because your done for the day. I can remember as a kid going out to a movie or dinner with my family and riding through the car lot looking at the latest models.
Simply place a device in a vehicle with a message like:
“See One You Like? Tell Us HERE!” – YOUR WEBSITE LINK
“Schedule Your Test Drive Below…” – YOUR WEBSITE LINK
“Contact a Sales Representative Now!” – YOUR WEBSITE LINK
“Seen Our Lease Specials? Click Below NOW!” – YOUR WEBSITE LINK
“Cash Back On All Truck Models!” – YOUR WEBSITE LINK
Service Based Businesses: The list of service businesses that physically go to a customers residence or place of business is extensive. Many businesses like plumbers, roofers and construction companies don’t have branded vehicles with wraps or advertising on them. Place a device in each vehicle and roll out!
How many times have you seen a roofer or plumber parked out in front of a home and wondered which business it was doing the work next door?
Here’s a few ideas on how to this leverage technology to build brand awareness.
“We’re The Roofers Next Door” – YOUR WEBSITE LINK
“Serviced Your HVAC System Lately?” – YOUR WEBSITE LINK
“Is Your Septic Tank Full?” – YOUR WEBSITE LINK
“New Flooring Installed $1.oo Sq. Ft.!” – YOUR WEBSITE LINK
“Too Busy For Yardwork? Click Here!” – YOUR WEBSITE LINK
“Call Us You Need A Tow” – YOUR WEBSITE LINK
Bookstores: If your bookstore sells coffee or pastries why not send a notification just like a coffee shop? I’m not sure of the margins book stores have but a coupon offer would make me consider more than the one book a I came to purchase.
“Buy one book get 10% OFF your 2nd!” – YOUR WEBSITE LINK
“Have a cup of coffee while you read…” – YOUR WEBSITE LINK
“Click Here To See Our Newest Releases!” – YOUR WEBSITE LINK
Boutique Clothing Stores: Advertising specials or clearance items is what comes to mind for marketing a clothing store. Most of these shops are in areas with heavy foot traffic so why not capitalize on it?
“Clearance EVENT Happening Now ==>”- YOUR WEBSITE LINK
“Check Out Our BOGO Offer!” – YOUR WEBSITE LINK
Gym, Yoga & Fitness Centers: When it comes to fitness centers with memberships I think of deals on extending their contract for a longer term at a discount for in-store promos.
“Need A Personal Trainer? – YOUR WEBSITE LINK
For marketing outside of these your physical store locations:
“New Member Special!” – YOUR WEBSITE LINK
“Get Fit For Summer!” – YOUR WEBSITE LINK
Festivals & Trade Shows: Nothing draws a crowd like a crowd. Launch a contest or giveaway through a notification in exchange for a prospects email.
“Come By Our Booth NOW To Win $$$!” – YOUR WEBSITE LINK
“Have You Seen Our Exhibit Yet?” – YOUR WEBSITE LINK
“ENTER To WIN [your product] at our booth!” – YOUR WEBSITE LINK
Farmers Market Vendors: This is where the savvy farmer or craft maker can dominate the local farmers market. You can’t always get the best real estate at the these venues but you can pre-sell them on your deals as they walk or drive up.
If people are anything like me they’re always checking their phones right after they park the car. Let’s have a special on heirloom tomatoes notification ready when the parking break is set!
“Fresh Sweet Corn 3/$1.00!” – YOUR WEBSITE LINK
“Grass Finished Beef At >>>” – YOUR WEBSITE LINK
“Local Honey $7.00 QT.” – YOUR WEBSITE LINK
“Fresh Zucchini Bread Today” – YOUR WEBSITE LINK
“Organic Eggs $5.50/dozen!” – YOUR WEBSITE LINK
Funeral Homes: I know, I know. Maybe it’s weird to include funeral parlors but let’s face it. Who really thinks about planning for this event for themselves?
You have a captive audience that’s thinking about their future when at a funeral wake viewing. This is where you have to put the breaks on the aggressiveness of your message in my opinion. I won’t even begin to write headlines for this subject so use your imagination on this one.
New Lead Generation
Insurance Agents
Financial Planners & Accountants
Affiliate, Network & Internet Marketers
Realtors, Real Estate Investors, Property Managers & Wholesalers: Market your open houses to everyone on foot or driving by your listings. Real estate investors and agents can simply place a Bluetooth notification device on your keychain as you drive around town or place one in each listing.
“Open House Sunday! Directions at ===>” – YOUR WEBSITE LINK
“House for Rent/Sale At ===>” – YOUR WEBSITE LINK
“Move In Special!” – YOUR WEBSITE LINK
“Selling Your Home? Call Me!” – YOUR WEBSITE LINK
Insurance Agents: I don’t know an Auto, Home or Life insurance agent that isn’t always looking for new customers. Have one of these devices on your keychain or in your car so you’re always in front of new people.
“Is Your Auto Ins. Coverage Adequate?” – YOUR WEBSITE LINK
“Is Your Life Ins. Coverage Adequate?” – YOUR WEBSITE LINK
“Is Your Home Ins. Coverage Adequate?” – YOUR WEBSITE LINK
Financial Planners & Accountants: Thousands of people are retiring everyday and need your assistance so get in front of them with Bluetooth proximity marketing.
“Retiring Soon? Schedule a call here ===>” – YOUR WEBSITE LINK
“Is your 401K gonna be enough?” – YOUR WEBSITE LINK
“The market is up… are you _____?” – YOUR WEBSITE LINK
“The market is down… are you ______?” – YOUR WEBSITE LINK
“Taxes done here…” – YOUR WEBSITE LINK
“Filed your taxes yet?” – YOUR WEBSITE LINK
Attorneys: I’m not an advocate of divorce but I am a marketer so I wanna see everyone do well. With that said here’s headlines that that may be “little” edgy…
“Cheating Spouse? Call 555-5555” – YOUR WEBSITE LINK
“Owed Child Support? Call 555-5555” – YOUR WEBSITE LINK
“Legal Representation” – YOUR WEBSITE LINK
“Teeth Whitening Special” – YOUR WEBSITE LINK
“Does Your Child Need Braces?” – YOUR WEBSITE LINK
“Invisalign $_______” – YOUR WEBSITE LINK
“Porcelain Veneers $_______” – YOUR WEBSITE LINK
Affiliate, Network & Internet Marketers: The possibilities of building HUGE lists and making a ton of sales with this technology in this space is near infinite. When I first saw these I immediately thought Clickbank, JV Zoo and other CPA (Cost-Per-Action) networks like Cash Network and Max Bounty.
Here’s what I’ve came up with to earn $1,000’s per month using these…
Make Money Online: These devices are a MLM’rs and Network Marketers dream come true. Since the notification displays the corresponding social media icon you can simply link to your social media profile like Facebook, Instagram or Twitter and say something like:
 “I found you, wanna know how?” – YOUR WEBSITE LINK
 “Are we friends on _____?” – YOUR WEBSITE LINK
 or for linking to your opportunity:
 “Does Your 9-5’s SUCK?” – YOUR WEBSITE LINK
 “Call Your Own Shots In Life…” – YOUR WEBSITE LINK
 “Fire Your Boss Here ===>” – YOUR WEBSITE LINK
 “Dead End Job?” – YOUR WEBSITE LINK
 “Work From Home ===>” – YOUR WEBSITE LINK
 “Wanna Earn $500/Day?” – YOUR WEBSITE LINK
Weight Loss & Supplement Offers: Everyone at the gym is listening to Bluetooth headphones these days. Grab a cheap domain and forward it to an offer. Throw one of these in your pocket when hitting the gym or “strategically ” leave one under a bench or in the bathroom.
 “Wanna Lose More Weight” – YOUR WEBSITE LINK
 “Gain More Muscle… Click Here!” – YOUR WEBSITE LINK
Dating Niche: Let’s face it guys at the club are there for one thing and most of them aren’t the Casanova type so they could use some help with the ladies.
 “Get The Girl You Want NOW!” – YOUR WEBSITE LINK
 “Don’t Hate The Player… Hate The Game!” – YOUR WEBSITE LINK
 “How To Get Any Girls Number” – YOUR WEBSITE LINK
 “Text Your Ex Back” – YOUR WEBSITE LINK
Surely there’s 100’s of other ways you can generate revenue with this low cost, simple to use technology so I’ll leave you with one more idea…
I came across this iPhone app that pays $5 straight to your PayPal overtime you share it. You can download the app here at:
THE END… or is it just the beginning?
Howard Martell

Millennials are ambitious when it comes to financial freedom

Millennials Think Parents Should Stop Paying Bills Sooner

Scroll back up to restore default view.

When is the right time to become financially independent? Many millennials are – perhaps surprisingly – more eager to pay their own way at younger ages than when baby boomers think they should.

In a new survey by Bankrate, millennials and baby boomers were asked what ages were most appropriate to begin paying for housing, buying a car, and paying their cellphone bill. The ages millennials chose were younger than what baby boomers thought was appropriate.

For example, when it came to paying rent, 33% of millennials surveyed thought they should be on their own by age 22. Just 8% thought parents should help with rent between the ages of 26 and 29. The majority of baby boomers surveyed chose age 23 1/2 for when they thought millennials should pay rent without financial help.

Both demographics may be a little too ambitious. According to the US Census Bureau, there are around 24 million young people living at home with their parents. And for those on their own? Around 40% of people between 22 and 24 get financial help from their parents for living expenses.

Want to pay for something more in your price range? Millennials think 18 ½ is the best time to get off the family plan and start paying for your own phone. Baby boomers think 20 is the more appropriate age.

But expect to shell out major cash — a new iPhone 7 will set you back $769 without a contract. An unlimited data plan is typically $50-$90 a month before taxes. So staying on the family plan may be the more economical bet for financially savvy millennials — at $100-$200 a month for up to 4 people, think about sending a check to mom instead of to your phone carrier.

And when it comes to buying a car, millennials think those expenses should be their responsibility starting around age 20. Baby boomers said 22 is the more appropriate age to start paying for a car.

According to Bankrate, the survey showed that while millennials are often stereotyped as entitled, with the expectation of financial help from their parents, at least according to this survey, most millennials strive to be financially independent as early as possible.

But millennials face many challenges in actually making that happen, compared to baby boomers when they were the same age – the most important one being income. According to the Federal Reserve, millennials earn 20% less than baby boomers did at the same stage of life. Today, millennials have a median household income of around $40,500.

Also hindering financial freedom? Student loans: 42% of people between 18 and 29 reported having student loans, and the average millennial owes approximately $30,000.

The dream of financial independence and the reality of their current financial situation continues to be at odds for many millennials.

A daily cup of coffee ends up costing a lot more than you think

Business Insider

coffee smelling
coffee smelling

(Reuters/Alberto Lowe)
As a young man, Warren Buffett estimated he could save $300,000 over his lifetime by adjusting his haircut schedule.

Americans looking for ways to contribute to retirement funds can similarly look to their daily purchases — such as their morning cup of coffee — for potential savings, according to a Vanguard Blog for Advisors post by Frank Kinniry.

“By pocketing the $3.50 for coffee each day and investing it instead in a low-cost, diversified Roth IRA, you’d have an estimated $106,000 after 30 years,” writes Kinniry. “I don’t think anyone would pay $106,000 for coffee!”

This type of incremental savings plan is also endorsed by David Bach, author of “Smart Couples Finish Rich.”

“Becoming rich is nothing more than a matter of committing and sticking to a systematic savings and investment plan,” he writes. “You don’t need to have money to make money. You just need to make the right decisions — and act on them.”

Bach estimates the amount of daily savings needed to reach $1 million by age 65 in the the chart below. While it makes certain assumptions about how those savings will grow through investment — such as a 12% annual return rate — it illustrates the impact even a modest savings plan can have in the long run.

585170e3a1a45e46008b5c61 1200

(Business Insider)

But Americans, particularly millennials, have struggled to meet recommended savings goals. Kinniry notes that while Vanguard recommends saving enough so that retirees can spend 75% their annual income from when they were working, the median account balance among Vanguard retirement plan investors fell by 11% from 2014 to 2015.

But that trend is not irreversible, especially for younger investors.

 “The best way to change that trend is to continue to encourage your clients to look at their spending through a compounding lens and to calculate how much their regular purchases would equate to over time,” writes Kinniry. “Time is the biggest advantage young investors have.

Why the US can’t kick its addiction to Social Security numbers

One Ring to bring them all, and in the darkness bind them.

—J.R.R. Tolkien

David Haas doesn’t like to give out his Social Security number. He fends off all the requests he can, from doctors, credit card companies, the bureaucracy at large. In the end, it was summer camp that got him.

“If the camp refuses your child because you won’t divulge your Social Security number, you end up giving in,” said the Franklin Lakes, N.J., financial planner. Haas kind of caved to his daughter’s school, too.

Don’t be too hard on him. It is the number that rules us all.

Social Security numbers, which identify the retirement accounts Americans build up over a lifetime of paycheck deductions, are taken in the vast majority of data breaches, simply because they are ubiquitous. They’re a juicy target. Together with other basic information, like name and date of birth, the Social Security number is a passport to a person’s identity. Unlike a credit card number, which can be instantly canceled, the SSN serves most people for their entire lives, with some 496 million issued since the first batch of cards went out in 1936. Its use as authentication for personal accounts has expanded the opportunity for fraud.

The government has tried to lessen our dependence on the Social Security number as the ultimate identifier and authenticator—for example, some states ask for a driver’s license or state ID on income tax forms. Within its own ranks, the federal government is locked in a struggle to reduce the “unnecessary collection, use and display” of the number. In 2007, a presidential task force issued recommendations to “help prevent the theft and misuse of consumer’s personal information.” A decade later, on May 23, the Government Accountability Office testified about a GAO progress report on executive branch efforts to address the recommendations. The verdict: “These initiatives have had limited success.”

Among the initiatives was a proposed “alternative federal employee identifier” on Office of Personnel Management forms. That was abandoned as impractical “without an alternate governmentwide employee identifier in place.”

An estimated 17.6 million people, or some 7 percent of American residents 16 or older, suffered at least one instance of identity theft in 2014, the latest year of data available from the Bureau of Justice Statistics. And that was before mega-breaches like the one at the health insurer Anthem and at the Office of Personnel Management itself.

“We are bleeding fraud with the use of SSNs ,” said Eva Velasquez, chief executive officer of the non-profit Identity Theft Resource Center , which helps victims of identity theft.

Attempts to check the SSN’s proliferation have been failing for nearly half a century. As early as 1971, a Social Security Administration task force proposed that the agency take a ” ‘cautious and conservative position’ toward SSN use and do nothing to promote the use of the SSN as an identifier,” according to The Story of the Social Security Number, on the agency’s web site. No luck.

How about fingerprints? Government agencies including the Veterans Administration and the Post Office have tried them, but they came with the whiff of criminality. The bald string of numbers seemed the more practical way to go.

In its early days, the SSN wasn’t widely treated as sacrosanct.  In 1938, a wallet manufacturer in New York, which wanted to advertise how well those new Social Security cards fit into its billfold, used the actual number of its treasurer’s secretary, one Mrs. Hilda Schrader Whitcher. Mrs. Whitcher’s secret identifier (078-05-1120) was soon on display at Woolworth and other department stores around the country.

By 1943, nearly 6,000 people were using her number, according to the Social Security Administration, which voided it. Over the years, more than 40,000 people claimed the number as their own, and 12 people were found to be using it as late as 1977.

“They started using the number. They thought it was their own,” the real 078-05-1120 said, according to a history on the Social Security Administration web site. “I can’t understand how people can be so stupid.”

Since then, many companies and government agencies, while using SSNs internally, have at least stopped displaying them on ID cards and using them as subscriber numbers. Many use unique numbers, sent to a recognized device such as a cellphone, in place of the familiar request for the last four digits of the Social.  Some have suggested creating individual encryption keys, sort of like the code-generating tokens that workers use to access their computers from outside the office. Another idea, a national identification card, “creeps people out, because it seems very Orwellian,” Velasquez said.

Even creepier, she said, one frustrated consumer proposed that the government “just microchip me so you can scan me and thieves can’t dig it out of me.”

Until we all get chipped, the only person who can sharply curb the use of your Social Security number is you.

“Don’t blindly provide it because you’re asked for it,” said Gary Davis, chief consumer security evangelist for anti-virus software provider McAfee.

The tricky part is that you can be denied service. The Social Security Administration recommends asking why the number is needed, how it will be used, what will happen if you refuse to give it, and what law requires you to give the number to a private business. For example, there’s no legal reason you must give it to your doctor. Doctors almost always ask for it, though, sometimes because they’re using outdated forms, or for patients on Medicare, since your Medicare number is your Social Security number.

On income tax forms and financial accounts that wend their way to the Treasury Department, the ritual asking for and giving of the Social Security number is all but inevitable. Same with food stamps, child support enforcement programs, and state commercial driver licensing programs. Credit bureau TransUnion says the nine-digit wonder is indispensable.

“We consider the SSN to be an important part of the consumer reporting and credit granting ecosystem, and many regulators and consumer advocates recommend this approach, where available, for accurate matching,” TransUnion spokesman Dave Blumberg said in an email. “The SSN is also an important tool in identity verification and can help lenders to detect and prevent identity theft.”

Opening a bank or brokerage account requires a customer identification number, most likely a Social Security number or Individual Taxpayer Identity Number, according to anti-money-laundering provisions in the Patriot Act, the security law passed after the 2001 terror attacks. An auto insurer might demand the Social to ensure, say, that the credit information for an applicant is really for the driver operating the vehicle. Life insurers want it because it’s a good way to find a “lost” policyholder, or find out if the policyholder has died, by consulting the Social Security Master Death File, said Loretta Worters of the Insurance Information Institute. An SSN can also help find beneficiaries, she said.

Still, if in doubt, ask:  Why do you need it? How will you use it? Do I really have to give it?

New Medicare cards are going out without the SSN on them, but for those over 65 the number is sitting in their wallet. Medicare has until April 2019 to comply with a 2015 law requiring it to create a Medicare Beneficiary Identifier. An MBI generator will initially assign 150 million new 11-character identifiers made up of numbers and capital letters. Hassle alert: The transition will run from April 1, 2018, through December 31, 2019, the Medicare web site says. Medicare notes that the MBIs “will not contain inappropriate combinations of numbers or strings that may be offensive.” Because, of course, that’s our big worry.

The Social Security Administration is taking action, too. On June 10, Americans will need to turn on multi-factor authentication on their My Social Security accounts, which have been targeted by thieves setting up accounts using stolen SSNs to collect benefits.

As for Haas’s kids, or, more to the point, yours, the American Camp Association says it doesn’t require member camps to gather SSNs. But browsing through camp applications online, one finds the camper’s Social, or its last four digits, in demand on camp financial aid forms, authorization forms for medical emergencies, and so forth, sometimes accompanied by a promise to destroy the documents at the end of the season.

Will the U.S. ever break its addiction to the Social Security number? The Office of Personnel Management did begin exploring the use of “multiple alternate identifiers for different programs and agencies” in 2015, the GAO report said. The idea was to collect a Social Security number just once, when an employee started working, and then use different identifiers for different programs, like health-care benefits. The work was put on hold for lack of funding.

Some fear we’re just going to come up with another unique identifier that can be compromised, said Velasquez, of the Identity Theft Resource Center. But she’s hoping something will happen in her lifetime. She’s 45.

Two-thirds of Americans are worried about their financial future

Though many workers look forward to retirement, it can also be a scary prospect. For the first time in your life, you’ll go from earning a steady paycheck to relying on Social Security and, ideally, your savings to make ends meet. But while retirement should be a welcome change in theory, a growing number of Americans are more concerned about it than anything else.

In a newly released study by Country Financial, 67% of Americans say they’re worried about their financial future. Many, in fact, fear they won’t actually manage to retire at all given their financial circumstances.

It’s data that’s far from shocking. The Economic Policy Institute reports that nearly half of Americans have no retirement savings at all, and more than 50% of those surveyed admit that they don’t actually include retirement when mapping out their financial goals.

Why does retirement so frequently get pushed to the back burner? Often, workers have no choice but to focus on more pressing priorities, like managing their short-term bills. In the aforementioned study, 44% of respondents said they’re more focused on finding ways to deal with unplanned expenses than retirement. Meanwhile, 41% are more fixated on dealing with their healthcare costs.

Now it’s true that you can’t ignore your immediate obligations just to save for retirement. After all, if your roof collapses to the tune of a $5,000 repair or you’re hit with a $5,000 medical bill, you can’t just ignore those expenses in order to stick that money in your IRA or 401(k). That said, many workers can do better when it comes to saving for retirement. It’s just a matter of getting their priorities straight.

There’s more room for savings than you think

A large number of Americans live paycheck to paycheck, and spend every last penny they earn on their day-to-day expenses. But not everyone who lives this way actually has to. While there are countless Americans working multiple jobs and still living below the poverty line, others who aren’t saving do have the ability to change their ways — if they’re willing to make sacrifices.

How do you know which category you fall into? It’s simple. Take a look at your budget and see if there’s anything you’re currently spending money on that you don’t actually need. Your cable package, for example, is a reasonable thing to want, but you don’t actually need it the same way you need food, housing, and a means of getting to and from work.

Once you’ve identified those nonessentials, you’ll need to work on eliminating at least some of them. Will it be easy or pleasant? Probably not. But if you don’t start finding ways to put money aside for retirement, you’ll risk having inadequate income at a time in your life when you’re older and far more vulnerable. Or, worse yet, you’ll join the ranks of people who never actually manage to retire at all.

Small savings can go a long way

Another reason so many people don’t save for retirement is that the idea just seems daunting. After all, if you’re already living paycheck to paycheck, whether by choice or out of necessity, how on earth are you supposed to come up with, say, a $200,000 nest egg?

Here’s the thing, though: If you’re willing to put a small amount of money aside each month, and you invest that money wisely, you can turn a series of minor contributions into something major over time. It’s a concept known as compounding, and it basically means earning interest on top of interest so that your savings keep growing.

Say you’re able to save $100 a month for 30 years but not a penny more. If you were to take that money and put it in a checking account paying no interest, you’d have just $36,000 in time for retirement (which, incidentally, is more than what many near-retirees have but still not enough). On the other hand, if you were to invest that money at an average annual 7% return, which is actually a couple of points below the stock market’s average, you’d end up with roughly $113,000 — a far more comforting number. In fact, if you were to somehow manage to sock away $500 a month for 30 years and generate that same return, you’d have well over $500,000 to work with in retirement.

Nobody ever said that saving for retirement would be easy, but rather than spend your time worrying about your financial future, you can, and should, take steps to fix it. Attaining financial security in retirement often boils down to living below your means during your working years and being vigilant about saving. And if you’re willing to make the effort, you may come to change your outlook to one that’s far less bleak.

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Why millionaires are more afraid than ever nearly 40%

Millionaire confidence plunged by a record amount in May, sparked by fears of government dysfunction in Washington, D.C.

The Spectrem Millionaire Investor Confidence Index, a measure of millionaire confidence in the economy and markets, fell 17 points from April. That’s the biggest month-to-month drop ever recorded by Spectrem Group, a Chicago-based wealth-research firm that created the index.

The survey found that almost four in ten (39 percent) of millionaires plan to avoid investing in the coming month — the highest percentage since December 2013.

The main reason for the drop: politics and the turmoil surrounding the Trump Administration.

The top concern cited by the millionaires surveyed was the political environment.

“Even though the stock market remains at near-record high levels, millionaire investors are becoming increasingly cautious,” said Spectrem President George H. Walper Jr. “This is likely due to growing concerns about the weakening political position of President Trump given recent controversies, the declining likelihood of substantive tax reform in the near-term, as well as concerns about the recently submitted proposed federal budget.”

“Although non-millionaires also recorded a drop in confidence, the fact they are slightly more confident now than millionaires is a strong indication that we may be entering a tumultuous period for investors,” Walper said.

The political pessimism among millionaires is not being driven by Democrats, which would be predictable. The largest drop in the survey came among Republican millionaires.

“The Republican millionaires may believe they delivered the House, Senate and Presidency and still nothing is getting done, which ultimately may impact their economic views. They are worried that government dysfunction, which they identify as the most significant threat to the economy, could jeopardize both health care and the important tax cuts that may be fueling part of the stock market surge,” he said.

Of course, the stock market has continued to rally in recent weeks, which doesn’t suggest a panic among millionaires. And the survey is just a one-month snapshot.

But since millionaires own the bulk of the stocks and financial assets in the U.S., their fear could put a damper on stock-market growth in the coming weeks and months.

The Spectrem Millionaire Index measures the investment sentiment of households with $1 million or more in investible assets. The research was conducted between May 19 and May 23.