JW’s Financial Coaching Podcast JW’s Financial Coaching Podcast-A show devoted to answering your personal financial questions and covering current events in personal finance. Giving people a new perspective on their money!

October 26, 2015  
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  • In ode to Back to the Future Day; things to do today to help your financial future
  • Our financial future will be here before we know it
  • The importance of planing seeds today
  • Quick review of Lewis Howe's "School of Greatness"
  • Quote of the lesson

The JW’s Financial Coaching Podcast_88_edit

The movie, Back to the Future II, premiered on November 22 1989, which also happened to be my eight birthday. If you’ve seen the movie you know that part of the plot is the main characters going into the future, October 21st 2015. Now since the premier was almost 26 years ago, most of you probably weren’t old enough to think about or even care about money. Heck, some of us listening today weren’t even born yet in 1989. So today we are discussing thing that you do today with you money that your future self will back on and appreciate.

Below are a few of the things that we talk about in today's lesson. While none of these are really new or ground breaking, they just put a different spin to having a healthy financial plan.

  1. Paying off debt
  2. Investing
  3. Developing a career you love
    • Traditional Job or your own business
    • Most careers and business start from nothing
    • If you have a desire-take some time and money and invest in that
  4. Giving
  5. Working together with your spouse on money

Now with this being said, we don’t know the future and I am certainly not guaranteeing you will find success if you do one of these things. However I do know by looking back in the past that these steps DO have a history of working out, in a big way. The thing is that the next 5, 10, 15, 20, or 25 years are going to go by in a blink and will happen regardless of what we do. So why not let us have something to show for it by making wise financial decisions today that we can point to later on in the future as a tipping point.

I also share ways you can connect with other things that are happening around JW’s Financial Coaching via Social Media, the Newsletter, and the podcast.

In addition I was able to read a rough copy of Lewis Howe’s new book “The School of Greatness”. I highly recommend the book. While it doesn’t directly speak to your personal finances, the book is eight chapters full of stories, wisdom, and practical action steps to take to achieve your goals, whatever they might be.

This lesson’s quote is brought to you by Audible.com.

The best time to plant a tree was 20 years ago. The second best time is now.”Chinese Proverb

Enjoyed this lesson? If so, please consider taking a few minutes to leave a review of the show either in Stitcher SmartRadio, or iTunes. For a step by step video of how that works, please watch this video on how to leave a review in iTunes.

You can subscribe to future podcasts through Stitcher SmartRadio or iTunes, or by downloading the iPhone app. Or you may listen to the podcast on the JW's Financial Coaching Facebook Fan page.

If you have any comments, questions, or ideas for future shows you can send them to me and I will integrate them into a future show. There are two ways to get in touch with me: 1.) Email me at JWFinancialcoaching@gmail.com - Please put “podcast” in the subject line and keep your questions brief so they are readable on air. 2.) Simply fill out the form on the contact page. Please fill out your name, email, and your question/comment/suggestion and we will read it on air.

October 18, 2015  
00:0000:00
  • Can a teenager invest in an IRA?
  • Better to invest in retirement or in college when a teen?
  • What I recommend doing
  • Quick review of Andy Stanley's "How to be Rich"
  • Quote of the week

The JW’s Financial Coaching Podcast_87

I learned a lot of lessons in my teens and early twenties. Some of them were good and some not so good. But one of the best lessons I learned was the value of work. Not only did I learn the value of hard work, I also learned the value of relationships, became motivated to finish school and get my degree, as well as learning about money. That is why I was thrilled to receive a question from a listener about their teenage daughter working. The parent wanted to know if and how much their teen could contribute to an IRA. The answer is yes, as long as they had an earned income.

But that got me thinking about if I had to do it all over again, what I would do? Would I invest my money I earned as a teen in a ROTH IRA or save it for college? Considering I have two young boys, they will be facing this in about a decade so I decided to run some numbers and on today’s lesson I share the results and my conclusion on what I would recommend.

For my calculations I made the following assumptions:

  1. Worked for all four years of High School
  2. Saved $2,000 a year in a ROTH IRA or College Plan
  3. 8% annual return
  4. Not advocating going into student loan debt

Based on that assumption, our teen would have about $9,400 saved after they graduated high school. The advantages of having it in an IRA are that you it could keep growing. If that 18 year old doesn’t add another penny to the balance or touch any gains for 42 years, when they turn 60, they’ll have approximately $260,000 saved at 8%. If that investment earned 10% annual return you would have over $600,000. If you just put $9,400 into a ROTH IRA at age 22 and let it grow until 60, that amount would be $410,000 or about a $200,000 difference.

When we use that money for college an interesting thing happens. I did some research and the average tuition for a public state school for the 2014-2015 school year was $9,200 and that drops to $3,400 per year for a 2 year institution. Now that doesn’t include room and board but that prevents the student from borrowing for school for one year. Now it won’t pay for all of school, but by avoiding student loans we are able to start to invest in a ROTH IRA or company 401(K) plan a lot sooner and allow the power of compound interest to work in our favor.

What would I do? I would save the money for college first before I do any investing. It’s really tempting to look at the returns on those investments. But ultimately paying for school out of pocket and getting through without any student loans is the best investment one can make in themselves.

Here are some additional resources I’ve posted in the past about paying for school and investing.

This lesson’s quote is brought to you by Audible.com.

“If you buy things you do not need, soon you will have to sell things you need.” ~ Warren Buffet

Also I give a short review and recommendation on Andy Stanley’s book “How to be Rich”. I read this recently at the beach while on vacation with my family and it really spoke to me on how to handle my money as Christian living in the wealthiest nation ever. You can pick it up on Amazon and if you use the link on the show notes page I will get a percentage of the sale which helps pay for today’s lesson.

Enjoyed this lesson? If so, please consider taking a few minutes to leave a review of the show either in Stitcher SmartRadio, or iTunes. For a step by step video of how that works, please watch this video on how to leave a review in iTunes.

You can subscribe to future podcasts through Stitcher SmartRadio or iTunes, or by downloading the iPhone app. Or you may listen to the podcast on the JW's Financial Coaching Facebook Fan page.

If you have any comments, questions, or ideas for future shows you can send them to me and I will integrate them into a future show. There are two ways to get in touch with me: 1.) Email me at JWFinancialcoaching@gmail.com - Please put “podcast” in the subject line and keep your questions brief so they are readable on air. 2.) Simply fill out the form on the contact page. Please fill out your name, email, and your question/comment/suggestion and we will read it on air.