Making Margin

Welcome to the Making Margin podcast! Greenway’s team is here to discuss common financial mistakes and to help you navigate them. 

Meet the voices behind Making Margin:

• Nick
• Jeff
• Natalie

Today’s topic is all about open enrollment and how to know which plan is best for you.

• For many, health insurance is the largest single expense.
• According to the Kaiser Family Foundation, the $20,576 average family premium in 2019 is 22% higher than the average family premium in 2014 and 54% higher than the average family premium in 2009.
• At some point, you have to figure these costs are unsustainable.
  
   

Advice:

1. Even if you like your current plan, you should review what’s available out there.
   1. Have your needs changed?
      1. Pregnancy coverage? Adoption coverage? Childcare FSA availability?
   2. Has the plan changed?
   3. Has there been a change in providers available within the plan?
2. Compare estimated annual costs, not just monthly premiums
   1. Premium
   2. Deductible (including co-insurance/co-payments)
   3. Out of pocket max
   4. Most open enrollment options have a calculator to help calculate needs
   5. HDHP might be a better option, even with heavy health care users. Does cash flow support?
3. Factor in the tax savings associated with an HSA
4. Purchasing an exchange plan? Get free help
5. Beyond health insurance….
   1. Disability insurance?
      1. FLU
   2. Life insurance outside of work?
   3. Vision and dental?
   4. Legal plans?

Take Away:  Be careful when considering the plans available to you. Make sure to look at the overall cost/tax savings, not just the premium and deductible.

Resources:
https://www.kff.org/health-costs/report/2019-employer-health-benefits-survey/

Advice

1. Revisit your budget 
2. Consider alternative housing options 
3. Prioritize emergency savings 
4. Pay Off Debt 
5. Consider your health insurance options
6. Look at your mortgage 
7. Review your cell phone bill 
8. Network, network, network 
9. Avoid draining retirement accounts 
10.  Find some additional income source 
11.  Apply for unemployment benefits 
12.  Establish a HELOC 

Take Away: There are simple, and more complex, steps you can take to put yourself in a position where you can withstand a furlough, pay cut, or lost job. Many of these consist of sound financial principles at all times, whether the economy is expanding or contracting. 

Resources:

Greenway’s Spending Plan

Greenway’s Goal Setting Workbook

Welcome to the Making Margin podcast! Greenway’s team is here to discuss common financial mistakes and to help you navigate them. 

Meet the voices behind Making Margin:

• Nick
• Allie  
• Jeff
• Drew
• Natalie

Today’s topic: Every day, we get to talk to people who regret financial choices and prior viewpoints, and the impact that it has had on their lives. Today, we’re going to try to talk some sense into our own former selves.

 

Discussion topics:

• If you could go back in time, and tell your 22-year old self something about money, what would it be?
  • Drew: Limit your fixed expenses.
  • Jeff: Build healthy habits & build credit carefully.
  • Allie: Be aware of cash drag.
  • Natalie: Preserve your right to abandon & be prepared for the unexpected.
  • Nick: Price is what you pay, value is what you get.

Take Away: Some simple financial concepts can make a big difference when it comes to your finances.

Resources:

Greenway’s Spending Plan

Greenway’s Goal Setting Workbook

Welcome to the Making Margin podcast! Greenway’s team is here to discuss common financial mistakes and to help you navigate them. 

Meet the voices behind Making Margin:

• Nick
• Allie  
• Jeff
• Drew

Today’s topic is all about our predictions for the world to come.

 

Discussion topics:

• What do we think will happen with large gatherings? Concerts, football games, etc?
• What about movie theatres? WIll they survive? Would you go to the movies?
• Will offices still be a thing? Will working from home become the norm?
• Economic impacts? Supply chains?
• Who will be the winners and the losers out of this?

Take Away:  We’re not much for making predictions, but we thought we’d take the opportunity to share our thoughts on how things may change as a result of the COVID-19 pandemic. We have no idea what the world will look like, but we’re convinced that some things will be different.

Welcome to the Making Margin podcast! Greenway’s team is here to discuss common financial mistakes and to help you navigate them. 

Meet the voices behind Making Margin:

• Nick
• Allie  
• Jeff
• Drew

Today’s topic is all about investing through a global pandemic.

• On February 13, 2020, we released a podcast episode entitled “Investing is Boring” where we discussed the evidence behind our investment approach, and why investing shouldn’t be a thrill ride. Then, the entire world changed.
• Today we’re going to be talking about whether or not we’ve modified our approach, and what we’ve been up to for our clients.
• Also, we’re going to talk about the disconnect between the market and the economy. Why has the market recovered much of its losses while unemployment has skyrocketed?
  
   

Discussion topics:

• Who saw this coming?
• What has surprised you most about the way the market has reacted as of today?
• Why is it so tempting to want to make predictions about a totally unknowable future?

Take Away:  Have an investment plan that you are confident in no matter what happens in the world, then stick to it.

Resources:

Thinking Fast and Slow

 by Daniel Kahneman

Welcome to the Making Margin podcast! Greenway’s team is here to discuss common financial mistakes and to help you navigate them. 

Meet the voices behind Making Margin:

• Nick
• Allie
• Jeff

Special Guest: Allen Starrett

Today’s topic is all about saving for college. 

• College is expensive, and saving for it can be a big challenge, especially as it competes with other priorities
• According to US News,  the average four year in-state college costs about $10000 year, just for tuition, and the average private college costs almost $37000per year
• They point out multiple times on their site that most students pay less than the sticker prices, thanks to financial aid and scholarships
• While an institution like Yale University in Connecticut, for instance, advertises a sticker price of more than $55,000 for tuition and fees in 2019-2020, the average cost to students last year after receiving need-based grants was around $17,000.
• And, college graduates earn more over their lifetime. A recent study from Georgetown University found that, on average, college graduates earn $1 million more in earnings over their lifetime. Another recent study by the Pew Research Center found that the median yearly income gap between high school and college graduates is around $17,500.

Discussion Topics:

• Saving for college vs. competing priorities
• Is college going to look like it does now when our kids are old enough to go?
• What are the best vehicles to use to save for college? How can they be utilized most effectively?

Take Away: Having a plan, for whatever you decide to do, is key.

Resources:
- Here is a good recap of ownership of a 529 by a grandparent and all the implications. 

Welcome to the Making Margin podcast! Greenway’s team is here to discuss common financial mistakes and to help you navigate them. 

Meet the voices behind Making Margin:

• Nick

Special Guest: Allen Starrett

Today’s topic is all about estate planning and why it is so important.

Discussion topics:

• How Allen decided to get into estate law
• What are the important components of a complete estate plan?
• Why is it important for people to have those items?
• What can happen if they don’t?
• We find that convincing our clients that they need estate documents is one of the most difficult boxes to check. Why is that?

Take away: Make sure you have an estate plan and it is up to date!

Welcome to the Making Margin podcast! Greenway’s team is here to discuss common financial mistakes and to help you navigate them. 

Meet the voices behind Making Margin:

• Nick
• Allie  
• Jeff
• Drew

Today’s topic is all about the cost of having and raising kids:

• The estimated cost of raising a child from birth through age 17 is $233,610 -- or as much as almost $14,000 annually, the Department of Agriculture says. That’s the average for a middle-income couple with two children. It’s a bit more expensive in urban parts of the country, and less so in rural areas. 
• Up to a third of the total cost is housing, accounting for 26 to 33 percent of the total expense of raising a child. USDA comes up with those numbers by calculating the average cost of an additional bedroom - an approach the department says is probably conservative, because it doesn’t account for those families who pay more to live in communities that have better schools or other amenities for children.
• According to the University of New Hampshire: Child care expenses can be a large portion of family income. The average share of income spent on child care among families with young children who pay for child care is 8.8 percent. Nationwide, 26.8 percent of these families, or 1.4 million, spend more than 10 percent of their income on child care

Discussion topics:

• Do these stats deter people from having kids?
• Our own childcare story, as a kid and as a parent
• Why is it discussed so much less frequently than college expense? 
• How do we help people plan for it?

Take Away: Kids are expensive. Planning for those expenses can dramatically help.

Resources:

• https://www.cbsnews.com/news/cost-of-raising-a-child-parents-save-up/
• https://scholars.unh.edu/cgi/viewcontent.cgi?article=1287&context=carsey

Welcome to the Making Margin podcast! Greenway’s team is here to discuss common financial mistakes and to help you navigate them. 

Meet the voices behind Making Margin:

• Nick
• Allie  
• Jeff
• Drew

Today’s topic is all about buying a home vs. renting a home.

• Last week the updated S&P CoreLogic Case-Shiller home price index came out showing the change in home values for 20 major urban areas. Charlotte is one of the 20 cities listed, and over the last year had the third biggest home-price gains behind only Phoenix and Tampa. The weakest markets were SF, Chicago, and NY.
• Over the past year, home prices in charlotte rose 4.76% as of October (data delayed by three months) and over the past 5 years, Charlotte home prices have average annual returns of 5.3%
• Nationally home prices have risen an average of 4.75% per year over the past 5 years
• Zillow and other sites have made accessing an estimated home value much easier, but it made us re-visit the question: when does it actually make sense to buy a home, if ever?
  
   

Discussion topics:

• First home purchase. What made you decide to buy? What was the process like?
• Our favorite unexpected maintenance stories.
• When does it make sense to buy vs. continuing to rent?
• 10-year returns of residental real estate: 4.08%. 10-year returns for global commercial REIT index: 9.31% (as of 12/31). Global stocks (MSCI World Index) averaged 9.47%. Is a home actually an investment? Should we view it that way?
• If it’s a terrible investment, what is it?

Take Away:  Buying a home can be wonderful, but renting can be as well. What makes the most sense for your specific situation?

Home repair budgeting resources:

https://www.upnest.com/1/post/what-is-the-annual-cost-of-maintaining-a-home/

https://www.thebalance.com/home-maintenance-budget-453820

https://www.nerdwallet.com/blog/mortgages/the-real-cost-of-your-house/

Welcome to the Making Margin podcast! Greenway’s team is here to discuss common financial mistakes and to help you navigate them. 

Meet the voices behind Making Margin:

• Nick
• Allie  
• Jeff
• Drew

Today’s topic is why investing should be boring. We take a broad look at what we believe investing should look like and why.

Discussion Topics:

• How we design a portfolio for our clients
• How we use decades of historical data to guide our investment process
  • A 2016 study by S&P Dow Jones Indices showed that about 90 percent of active stock managers failed to beat their index targets over the previous one-year, five-year and 10-year periods; fees explain a significant part of that under performance.
• What exactly is an ETF, stock, bond, mutual fund, etc.?
• What’s the most important predictor of a relative investment return? 
  • Morningstar: https://www.morningstar.com/articles/347327/article
• What other types of fees should people be looking for?
• A lot of people now have target dated funds in their 401k. Positives and negatives?
• Investing is like amateur tennis 

Take Away: If investing seems boring to you, you’re probably doing something right.