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| Stat Of The Day |
| 2 Million |
| The share of U.S. job seekers out of work for six months or longer hit 27.3% in June – near its highest point since the pandemic-recovery days of late 2021. That’s nearly two million people who count themselves among the long-term jobless. If you’re one of them, check out this HerMoney Podcast episode featuring Jodi Kantor, who shares the two secret ingredients to finding a great job – even when things feel hard. |
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| This Week In Your Wallet |
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Taking a girls trip this summer? The Washington Post rounded up 42 essential group vacation rules – and money is at the center of most of them, from who’s covering what to who scores the best room in an Airbnb you’ve all paid for. Rule number one: get ahead of it. "Decide on a payment system for handling groceries, restaurant nights and boat fees," suggests the Post. "A quick: ‘How do we want to handle paying for things, do people like Splitwise or should we keep things casual?’ will help avoid stress on the type-A members of the party."
40 used to mean "settled." Now it’s "prime time." As The Wall Street Journal reports, a woman’s 40s once equated to a life that was locked in – career set, home purchased, family complete. "Three decades later, the standard playbook has changed entirely," writes Emma Rosenblum. "A woman’s 40s are now considered a dynamic and changeable era, as many of the so-called traditional milestones – homeownership, career, children – have been pushed later for personal, societal and economic reasons." Exhibit A: The positively glowing Anne Hathaway, 43, pregnant with her third and juggling a full slate of movies this year.
While boomers are a wealthy generation on paper, plenty aren’t as financially sound as you’d think – and for some, their kids are footing the bill. "Suddenly, adult children are tasked not only with helping with medical appointments and grocery runs — they're also scrambling to support their aging relatives financially, potentially blowing up their own savings in the process," reports Business Insider. "It's a case of intergenerational financial contagion: One generation's under-saving rewires another's math and rewrites their future." One of the biggest culprits? Not having a plan. Many people know they should have one for retirement spending – but according to a recent AARP survey, only about a quarter actually do. |
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| Your Two Cents (And Then Some) 💰 |
| Not every boomer is leaning on their kids. Some did everything right and are living their best lives. But for adult children who are struggling financially and not getting support from them, it can sting. That was the premise of a recent story we shared… and let’s just say you had thoughts. Here’s what our readers shared about why they do – and don’t – help their adult children financially: |
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"When my son graduated college and moved out, I told him I'd give him two years until he was kicked off my cell phone plan. I started looking into what my plan would cost when I removed a line... it would go UP! One definitely has to do their homework. Other than the phone line, he's been ‘off the payroll’ since he moved out." |
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"We support our daughter and her husband since she is in residency training and lives in the Bay Area. We did not support our son as much and he and his wife were not happy about this. We were in a different season, still paying college tuition for one child." |
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"We do not provide any financial assistance to our adult children – ages 25 and 27. We began talking to them in high school about the fact that once they graduated from college, they would need to pay their way. My son is a bit of a unicorn. He started a business in high school and has worked and made his own money for many years. My daughter worked all the way through high school and summers during college and then got a job for the last two years of college. She took out a loan and bought her first car on her own. She was surrounded by friends who had been given cars by their parents and is proud of what she's accomplished on her own." |
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"I don’t support my adult children. Our agreement was that we would support them through undergraduate school with no student loans. Then, they were on their own for graduate school and beyond. Thankfully, they’re both happily married, fiercely independent and successful." |
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| Things That Save You Money |
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| Ask Jean |
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| Q: |
Today’s question comes from Jill. She writes: "I am a single female with a $220,000 annuity I will use when I retire at 65. While researching, I noticed that men receive a larger payout than women. Why do they get more and why isn't that considered discrimination?" |
| A: |
Jill, your frustration is valid, but the explanation is actually a point in our favor. Men receive higher monthly payouts because, on average, women live longer. The pricing reflects that reality.
"I think it’s valuable to think about the fact that there’s an entity that has made a promise," explains annuity expert and LIMRA Retirement Income Institute fellow Tamiko Toland. "And one of the ways that they’re able to keep to that promise is by doing things like pricing the annuity fairly so that they know that they’ll be able to keep sending you those checks."
In other words, the tradeoff for a smaller monthly payout is typically more months of getting paid.
And speaking of longevity, here’s something that might surprise you: annuities can actually help you spend more in retirement. The math makes sense when you think it through. Without guaranteed income, a retiree who doesn’t know how long she’ll live may feel compelled to stretch her savings all the way to age 95 – or even 100 and spend less along the way.
An annuity changes that equation by pooling risk. The insurance company uses actuarial tables to estimate average life expectancy – around age 88 or 89 for a healthy 65-year-old woman – and charges a premium based on those averages to generate a certain amount of income.
"Because you’re sharing that risk with other retirees, you get to spend about 30 to 35% more every year. And it’s not magic; it’s just the insurance company using actuarial tables," explains Michael Finke, a Retirement Income Institute fellow and professor of wealth management at The American College. "By averaging it all out, they can charge a premium that’s lower than the amount of money that you’d need to set aside to fund income to the age of 95 or 100." |
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| Submit your questions to Jean here. |
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