🦸🏻‍♀️ How To Turn Humility Into A Financial Superpower

Stat Of The Day

$22.4 Billion

From chocolate bunnies to eggs, that’s how much consumers are expected to shell out for Easter this year. Not *quite* a record, but close, according to the National Retail Federation. The spending category growing the fastest? That’s Easter decor (because who can resist those tiny fuzzy chicks?) Shoppers are spending half a billion more on looking festive in 2024 than they were five years ago.

Women Say They’re Less Confident With Money…But Maybe That’s Okay

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Are you confident with money? According to The 2023 State of Women survey from HerMoney Media and Principal Financial Group, just 45% of women say they feel confident about money management — compared to 58% of men who say the same.

Yes, these numbers are disheartening, but they don’t tell the whole story. For starters, men almost always report greater levels of confidence than women when it comes to finances and career. For example, men report feeling better equipped to weather a recession than women do, and are also more confident salary negotiators than women.

But here’s the thing: That lack of confidence does not translate to a lack of competence. Studies have shown that women are not only more effective negotiators than men, we’re also more likely to make smarter moves with money during an economic downturn. And, when investing, women achieve higher returns than men do.

So, here’s the real question: Is it a problem that women don’t feel as confident as we should? Maybe not. As Taylor Swift might say, having to scale the bars that men set for reveling in our accomplishments (then shouting them to the world) is nothing so much as exhausting. Instead, let’s grow our financial confidence while simultaneously embracing our humility for exactly what it is — a superpower. Here’s how to do exactly that.

This Week In Your Wallet

Have student loan debt? You’ll want to mark your calendar for April 30th. That’s the deadline for those with multiple federal student loans to request a consolidation and improve their odds of loan forgiveness. Here’s why: Income-driven repayment plans set monthly payments based on a share of the borrower’s discretionary income. Depending on the plan, debt is usually forgiven over the course of 10-25 years. But things get complicated when students take out multiple loans at different times. Now, as part of a federal overhaul of income-driven repayment plans, the Biden administration is temporarily allowing borrowers to combine their loans and get credit dating back to the first payment on their oldest loan. As CNBC explains, "For example, say a borrower graduated from college in 2004, took out more loans for a graduate degree in 2018 and is now in repayment under an income-driven plan with a 20-year timeline to forgiveness. Consolidating could lead them to immediately qualify for forgiveness on all of those loans, experts say." For more on how to apply, click here.

And, speaking of student loan debt, it’s one of the factors that’s making retirement a "luxury" for a growing number of Americans. In 2023, just under 20% of Americans 65 and up were employed–up from 11% in 1987, as Business Insider reports. "I certainly think that this is the first generation of parents retiring who have really taken on a lot of student loan debt," Geoffrey Sanzenbacher, an economics professor at Boston College says. He notes that nationwide, parents carry roughly $112 billion in debt through Parent PLUS loans. One of the other factors jeopardizing retirement for older Americans? The end of the pension era. "For decades, traditional pension plans meant a steady retirement guarantee," reporter Juliana Kaplan writes. "Meanwhile, the prevalence of 401(k)-style retirement plans has contributed to inequality as those in higher-income professions tend to contribute more to their accounts over the years."

A smiley face on your restaurant receipt can convince you to tip more. That’s according to a new study, which shows a server’s tip can increase by 11% when emojis are included with tip suggestions on your bill. "Specifically, the largest increase in customer generosity came in scenarios where multiple emojis were shown with suggested tip amounts," reports The New York Post. "Neutral faces accompanied lower gratuities and, as the recommended percentage grew, so did the emojis’ cheek-to-cheek smile." The tipping spike was greatest when it came to takeout orders, which grew more than 32% when emojis were used. Now that’s service with a smile.

Ask Jean

Today's question comes from Shelley. She writes: My mom needs to move into assisted living and so needs access to much more of her assets than before. How much can you take out of your IRAs or other tax-advantaged plans before triggering a big tax bill? People say to contact your tax advisor, but unfortunately, that’s currently me.

Hi Shelley. Your mom is fortunate to have you helping her with this — because you’re right, it’s a bit of a bear. Money that comes out of tax-advantaged plans (with the exception of Roths) is treated as ordinary income and taxed as such. What that means is that you have to look at how much she’s pulling out and combine that with other sources of income to determine how much of a tax bill you’re looking at.

For example for 2024, any income of up to $11,600 or less for single filers (you don’t mention anyone moving with your mom, so I’m assuming she’s on her own) is taxed at a 10% rate. From $11,601 to $47,150, income is taxed at the 12% rate. That’s all pretty good. So, if your mom is receiving, say $20,000 a year from Social Security, she could pull up to another $27,150 from her IRA and pay taxes at those preferential rates. From that point, though, tax rates jump — and pretty substantially. Any money that she earns from $47,150 to $100,525 will be taxed at 22%.

So, the question becomes how much is assisted living? And are you looking at one big tax bill to get her in, or a series of large tax bills along the way? One last point: Many of the provisions of the 2017 Tax Cuts and Jobs Act are set to expire on December 31, 2025. At that point, marginal tax rates will revert to their previously higher levels — the 12% bracket goes back to 15%, the 22% to 25%, etc. This could change depending on who wins the presidential election, but it’s a reason to think about doing some tax planning now to minimize the potential bite in the future. I think it’s worth paying for some additional tax advice now — talk to an accountant or financial advisor with accounting experience who can look at your mom’s finances and give you a game plan for the next few years.

Have a question for Jean? Submit it here.

Things That Save You Money

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Is the more expensive boxed pasta really any better than the cheap stuff? Becky Krystal, Food Writer for The Washington Post says no…but with one important exception. Mangia!

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Love Diane von Furstenberg but hate the price? Target has dropped a new collab with everything from DVF’s infamous wrap dresses to bedding. Selection is limited online, but one member of the HerMoney team reports her Target was well-stocked. Check your local store, STAT!

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This just in…data shows that Reese’s Eggs are the most popular Easter candy. But with the cost of chocolate soaring, that treat can be pricey. Save $$$ by checking out this highly-rated Reese’s Egg dupe from Aldi.

How A Personal Finance Expert Fell For A Financial Scam With Charlotte Cowles

"Most people who wind up not losing money, it’s not because they were smarter or because they noticed a red flag. It’s because they were interrupted by someone else who snapped them out of it and broke the spell."

When you envision the type of person who falls for a financial scam, who comes to mind? Perhaps an elderly person? Someone who uses a landline phone? You probably don’t think of a personal finance expert.

Enter Charlotte Cowles, a financial advice columnist for The Cut since 2016 and a longtime freelance business columnist for The New York Times. She fell for an elaborate scam involving Amazon, the FTC, and threats directed at her child, and ended up handing over a box with $50,000 in cash to a scammer.

It started with a call from a recognized Amazon number, with a person saying her account had unusual activity. From there, Cowles was transferred to an "FTC agent," who knew all sorts of information about her (even her Social Security number) and said her family was in danger. "What preceded was several hours on the phone that ultimately culminated in me handing over the contents of my emergency fund," Cowles says.

But how, exactly, did she end up giving away her entire life’s savings? And what can you do to protect yourself from similar scams? Listen to the HerMoney Podcast* to find out.

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The HerMoney Podcast is made possible by Edelman Financial Engines.

More For You To ♥

🍼 More than 2,100 moms have *this* woman to thank for their side hustle. Meet Fran Maier, the woman behind BabyQuip. How She Does It is proudly supported by iShares.**

🧠 Retirement isn't just a milestone; it's a seismic shift in mindset. It's swapping deadlines for endless possibilities, routine for reinvention, and, of course, switching gears from accumulating to spending–and enjoying–your money. Jean interviews Morgan Housel, bestselling author of The Psychology of Money, on how we can change our mindset on this Your Money Map with Alliance for Lifetime Income.**

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