Today on The After Show I talk to financial expert Bobbi Rebell. Bobbi is the author of the best-selling self-help /personal finance book, "How to Be a Financial Grownup: Proven Advice from High Achievers on How to Live Your Dreams and Have Financial Freedom." With her background as an award-winning TV anchor, most recently at Thomson Reuters, Bobbi made a major career pivot by leaving her television career and focusing on helping thousands of women discover their financial mojo. We talk about her strategy in making this big change and a few of her great pieces of advice in the book. Enjoy! Xo, Jen
Becoming a homeowner is still the American dream for millions of young people. But from student debt to low paying jobs, the obstacles are steep.
Here are some ways to get into a starter home a little bit faster.
1. Re-define location, location, location
This real estate mantra used to mean making sure you bought property in the most upscale location possible. Now that notion is being turned upside down. You don’t have to live in a super expensive place like New York City of Palo Alto. Think outside the box and consider cities like Huntsville, (Alabama), Billings (Montana), or Colorado Springs (Colorado), which are often cited as affordable places to live with great lifestyles.
2. Sell something to raise capital.
This is something PwC CEO Bob Moritz talks about in “How to be a Financial Grownup: Proven Advice from High Achievers on How to Live Your Dreams and Have Financial Freedom.” He sold his Firebird, acar he loved but he knew that money would be better spent on his first home. He traded it in for a $500 used car and never looked back. It was a sacrifice, but it also saved him many years of penny pinching to try to save up the down payment.
3. Downsize the down payment.
Putting down less than 20% is an option many people can take, but there are drawbacks. In most cases you may have to pay insurance for putting down less than 20%. But sometimes that insurance is more than paid for by the savings of not paying rent. According to RealtyTrak, about a third of home buyers put 3% or less down when they buy a home. For example, Fannie Mae’s HomeReady allows buyers who qualify to put down just 3%
Get more Real Estate tips in “How to Be a Financial Grownup: Proven Advice from High Achievers on How to Live Your Dreams and Have Financial Freedom” by Bobbi Rebell.
By Bobbi Rebell, Reuters correspondent and author of “How to Be a Financial Grownup: Proven Advice from High Achievers on How to Live Your Dreams and Have Financial Freedom“
Striking that balance between being a supportive friend and feeling taken advantage of is a tricky one, but definitely part of becoming a financial grownup. Here are four situations that friends often have to deal with and advice on how to maintain your friendships—and your money.
The money ask
The key thing here is compassion and a willingness to help. Asking for money is tough. So hear your friend out. But also be honest with yourself about your own financial situation. If you can afford to help, consider a gift. If your friend insists on a loan, tread carefully. It will create a tension between the two of you, and you will always feel bad asking for the money back. Your friend may start to avoid you if he or she can’t pay it back.
If you need the cash
Try to avoid asking friends for money. Not only does it put them in an uncomfortable situation, but it can also force them to help you at the expense of their own finances. Instead, set up a platform where they can give what they want, when they want. For a medical situation, for example, GoFundMe could be a great resource. If the money is needed for a business, check out Kickstarter. Then you can just let your friends know that you’d appreciate whatever help they can give.
The forgetful friend
We all know the people who don’t bring their wallets or credit cards and say, “I’ll get it next time.” And then they don’t. Take charge and help them download some apps that can store their payment information like Venmo and Apple Pay. They probably won’t forget their phone.
Ordering up a storm at dinner
Dinner out with friends can turn into a financial disaster with just one uncontrolled guest. He or she orders up a storm, including expensive bottles of wine. Sometimes the discourteous diner even “gets a call” towards the end of the meal and makes a quick exit, promising to pay you back later. We know how that will go. The best tactic is to be subtle. Mention you aren’t drinking and ask who else isn’t, and suggest those who are drinking order by the glass so they can try different wines or that you share a bunch of entrées to save room for the amazing desserts.
Get more tips on avoiding awkward money moments in “How to Be a Financial Grownup: Proven Advice from High Achievers on How to Live Your Dreams and Have Financial Freedom” by Bobbi Rebell.
Financial do's & don'ts during a divorce
By Melanie Lockert, personal finance freelance writer and author of Dear Debt
Nobody gets married thinking one day they’ll end up divorced. But for nearly one in two people, “I do” will turn into “I don’t.” While the impact of divorce can leave you with a broken heart, the consequences go far beyond emotions.
Getting a divorce can turn your financial life upside down. Untangling years of partnership — and your bank account can be a messy, unpleasant affair. Worse yet, when things are heated, and you’re in an emotional state, it may not be easy to make rational, informed decisions about your finances.
If you’re going through a divorce, here are some financial do’s and don’ts to guide you through this tough time.
Financial Do’s During a Divorce
When going through a divorce, there are certain things you want to do for your finances and certain things you may want to avoid altogether.
The first thing you want to do is take an inventory of your financial accounts. “Add up your assets and debts. Determine which are 'marital' vs. which preceded the marriage. Assets such as unvested stock options or earned (but not yet paid) pensions must be included, even though they have no cash value today,” says Sara Stanich, Certified Divorce Financial Analyst at PowerOverDivorce.com.
Once you’ve assessed your financial situation, it’s time to come up with a plan moving forward, says Stanich.
“Agree with your spouse to either maintain the "status quo" financially (ie. paying household expenses from a joint account) or separate your finances immediately when the divorce settlement is decided and finalized,” Stanich says.
If you don’t have any children together, it may be best to separate your finances as soon as possible and come up with a plan to move forward. Instead of quibbling over every last detail, Bobbi Rebell, author of How to be a Financial Grownup, who experienced a painful divorce at age 30, received the advice to treat a divorce like a financial transaction and focus on making it as simple as possible, rather than focusing on what is fair.
That can be tough when it feels like you’re fighting for everything you feel should be yours. Suddenly you go from “ours” to “yours, ” and the change can be tough. But Rebell says moving on quickly and efficiently (as much as you can with these sort of things) can actually be good for your finances.
“You have so many years to make up for making a less than perfect financial settlement,” says Rebell. “By dragging it out, you are not only paying lawyers, you are distracting yourself from focusing on your job or business, and that will cost you more in the end,” she says.
Focusing on the process of getting divorced rather than on dragging it out and fighting dirty can make for a more cost-effective divorce and can help you achieve freedom and the peace to move on.
Alan Steinborn, founder of RealMoneyLife.com, originally felt like fighting for half of everything when going through his divorce, but at the suggestion of a mentor, he decided to stop the fighting and move forward with an uncontested divorce.
Aside from focusing on creating a financial plan going forward and untangling your finances, you also want to make sure you check your credit report during this time. You’ll want to avoid debt as much as possible and keep your credit in good shape. Once you have a plan in place going forward, you’ll want to remove the other party off of any bills, accounts, utilities, etc.
If things do end up getting tense and unmanageable, you may want to hire an attorney. “Even if you and your spouse agree on the important issues, divorce attorneys know the tax implications and are well-versed in solving sticky financial issues,” says attorney Rebecca G. Neale of ThePersonalFinance.Lawyer.
What NOT to do during a divorce
Now that you know what you should do during a divorce, it’s key to understand the things you should avoid during a divorce.
The most important thing? “Make financial not emotional decisions,” says Roger Wohlner a financial advisor at The Chicago Financial Planner.
It’s easy to get caught up in the heat of the moment, but if things are too tense, consider holding off on important financial discussions until tempers are cooled. When that happens, consider meeting at a neutral location outside of the home to discuss your finances going forward.
If that doesn’t work, you may want to work with an impartial party to help you navigate next steps. “It might help to seek the help of an impartial third-party like a financial advisor,” says Wohlner.
During the divorce process, it’s important to be open and honest about your financial situation. Trying to hide assets, lying about any debt, or making sudden moves can add insult to injury. Though your future together may be over, you still have to work together to figure everything out.
“Don't try to hide money in separate accounts or under the mattress. Everything needs to be disclosed eventually, and you might as well save yourself time and legal expenses by being up front from the beginning,” says Stanich.
Lastly, Stanich suggests not maintaining the same lifestyle you had when you were married. You will need to adjust to your new financial reality. Depending on your situation that could include additional expenses like alimony, child support and more.
Don’t live like you have two incomes sharing expenses when you’re adjusting to single life or else risk getting into more financial trouble.
Though your financial situation has changed, that doesn’t mean you should stop saving for your future. “Don't stop contributing to your retirement if you can afford to do so,” says Cary Carbonaro, author of Money Queen Guide For Women Who Want to Build Wealth and Banish Fear.
Getting divorced can be one of the most painful, stressful life events you go through. It can also complicate your finances in ways you wouldn’t imagine.
Join Jane King and Kim Mustin and this month's guest Bobbi Rebell, financial journalist and author. Bobbi talks about her new book "How to be a Financial Grown-up". In it, she's interviewed some of the most successful people in business about their finance challenges and how they learned from them. Jane, Kim and Bobbi also discuss kids and money and how they navigate the the tricky path of family finances. Plus some parents give tips on this show about kids money apps and games