Although the concept of retirement remains largely unchanged, how you live out those years has shifted dramatically over the years.
Following are seven key ways in which your post-work life is likely to differ sharply from that of your parents.
You’re more likely to plan a later retirement date
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A growing number of Americans appear to have reached the same conclusion: Dreams of sipping colorful drinks on a deserted beach are just going to have to wait a while.
In a quarter-century, the percentage of workers expecting to retire after the age of 65 more than tripled, from 11 percent in 1991 to 37 percent in 2016, according to the Employee Benefit Research Institute.
However, planning to delay your retirement and actually doing so are two different things. While 26 percent of workers plan to wait until at least age 70 to retire, just 8 percent of retirees actually do so.
You’re more likely to live downtown than in the suburbs
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The stereotype suggests that retirees want a quiet home in the country, undisturbed by the noise of modern life.
The reality is quite different. In fact, retirees are flocking to urban centers to live out their golden years. AARP cites a report from TenantCloud, a property management software service, revealing that about one-third of all urban applications are for renters who are older than 60.
You’re more likely to head outdoors for fun
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Americans of all ages increasingly look to the great outdoors and nature when planning activities. Camping, biking and birdwatching all are growing in popularity across age groups, according to the Physical Activity Council’s 2019 Participation Report.
Older adults are particularly drawn to anything that gets them out among wildlife, including fishing and wildlife walks.
You’re more likely to be healthier
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Good news for aging folks who worry about their bodies suddenly falling apart: Today’s retirees can expect to enjoy much better health than retirees of earlier generations.
From 1998 and 2012, the percentage of adults ages 80 and older in fair or poor health dropped significantly, from 43 percent to 34 percent, according to an Urban Institute report.
Alas, tomorrow’s retirees might not fare quite so well. Between 1992 and 2010, the percentage of adults ages 51 to 54 who reported fair or poor health jumped from 17 percent to 22 percent.
The source of this bad news? An increase in the rate of people diagnosed with diabetes, largely a result of our high-fat, junk-food diets and rising obesity rates.
You’re more likely to live abroad
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For generations, retirees have used their free time to travel. Now, a growing number of such folks are choosing one-way adventures, with no plans of returning home.
The percentage of Americans retiring abroad jumped 17 percent between 2010 and 2015, according to an Associated Press report. A little under 400,000 retirees were expatriates four years ago, and that number is expected to grow.
Some countries are more attractive destinations than others. In fact, one country — Costa Rica — is especially desirable for its cheap, modern health care, as we reported last year.
You’re less likely to downsize
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As workers near retirement, they traditionally have expected to downsize to more modest — and less costly — digs. However, that rule appears to be more myth than reality for millions.
A joint Merrill Lynch-Age Wave survey found that half of retirees did not downsize in their last move, with 30 percent actually “upsizing” into a larger home.
The reason? These retirees want more room for family members to visit or stay.
You’re less likely to leave an inheritance
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Better not show this one to your kids: A 2015 HSBC survey of workers in 15 countries and territories — including the U.S. — found that 23 percent of workers prefer to spend all of their savings rather than to leave the cash to children. In fact, just 9 percent intend to save as much as possible and pass the money on.
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April 2 is Equal Pay Day, which symbolically marks the day in the year when the typical woman has worked long enough to catch up with what the average man made in the previous year.
Until that gap is bridged on a national level, here’s what women can do individually to help improve their own pay situation:
1. Don’t make it awkward
“Money talk doesn’t have to be uncomfortable,” says Kenia Calderon, a client relations director in Des Moines, Iowa, who got a promotion and negotiated her salary last fall. “Reflecting on your contributions can build up your comfort level.”
Researching salaries across your industry and brushing up on techniques from women who have successfully increased their pay can boost your courage.
Tori Dunlap, a digital marketing manager and founder of Her First $100K, a money and career platform for millennial women, compares the conversation to a presentation or audition: “Knowing the piece like the back of your hand — and your answer to any potential rebuttals — can help you feel confident even when you’re nervous or facing the unknown,” she says.
2. Document, document, document
Did you recently take on a new project, land a client or make a daunting process more efficient for your company? Jot all of that down — and in as much detail as possible.
Jackie Luo, a software engineer in San Francisco who recently landed a promotion, emphasizes the importance of logging your wins, however big or small.
“I keep track of all my accomplishments in a ‘hype doc’ mapped to my company’s leveling system so that it’s really clear to me, my manager and the people in charge of approving promotions where I stand,” Luo says. “If they need to see examples of technical projects or instances of mentorship, I have all of that documented.”
3. Go back to your job description
It might seem obvious, but the best way to ask for a raise or promotion is to prove that you’re going above and beyond the scope of what you were hired to do. Referencing your original job description is a good place to start.
“I realized that a few of my key responsibilities were not noted on the job description,” Calderon says. “Bring these up. Your employer may overlook them or not realize how much time these tasks take.”
Prepare to speak to how the tasks you’re doing — the ones not covered in the job description — benefit your team or company. To negotiate more effectively, frame the conversation in a positive way (“I’ve successfully taken on a greater workload”) versus complaining about all the extra work you’ve had to do over the past quarter.
4. Connect with a female mentor
It can be challenging and intimidating to tackle issues like pay on your own, so have someone in your corner. See if there’s another woman who can be a trustworthy, go-to resource for steady advice and support — perhaps a colleague or a friend in the same industry. This is especially important if you’re in a male-dominated industry.
“Women in tech can feel isolated or alone due to not seeing role models that look like them,” says Jossie Haines, a platform engineering director at Tile in San Jose, California. “Mentoring can help combat those feelings. I implore all women to find a mentor or sponsor, especially if they feel like they’re struggling.”
If you’re having trouble identifying one, you can join a dedicated mentorship organization, such as Million Women Mentors or Women Accelerators. The right mentor can be your sounding board and spur you to advance your career one step at a time.
5. Look for a sponsor
Although mentors can provide invaluable career advice, sponsors can take a more direct role in advancing your career.
So what, exactly, are sponsors? They’re people at your company who can advocate on your behalf and directly influence the type of work you do, which can impact your salary and overall career growth. Perhaps it’s your manager or someone on another team who can give you more resources or connections at your company.
“Sponsoring can expose women to new opportunities they may not usually have access to,” Haines says.
Emily Sheboy, a project manager in Washingtonville, New York, who says her sponsor is also her direct supervisor, says the key is to be transparent about what you’d like to do. “Make the most of having a sponsor by being forthright and honest about your skills and ambitions,” she says. “And if they have the ability to influence projects you get assigned to, thank them and ensure you do a good job.”
You might already be investing in the stock market, whether your goal is to fund an upcoming splurge or enjoy a relaxing retirement.
But investing in real estate? That’s a whole different level of penny hoarding… right?
Considering the average price of a new home in America is a whopping $362,400, per Census data from November 2018, it’s easy to think that real estate investments are out of reach for the average earner. Even a minimal 3% down payment on that amount is a five-figure sum!
But at the same time, investing in real estate is one of the most reliable ways to build wealth — and you don’t have to buy a whole strip of office buildings or a swath of rental properties to do it.
In this post, we’re going to cover how to invest in real estate with little or no money to start with, as well as some more creative ways to boost your earnings if you’re getting ready to buy a home.
Why Investing in Real Estate Is a Good Idea
You might think that real estate investing is not only unaffordable, but also a plain old waste of time. Why sink so much money into buying property when there are so many other ways to generate cash flow?
Why is real estate such a good investment?
Well, for one thing, when it goes well, it goes really well. Smart real estate investing is one of the easiest ways to become a self-made millionaire. (Remember, though, that “easy” is relative.)
Even if you’re not hoping to become rich Uncle Pennybags, investing in real estate is a great way to earn a passive, or at least semi-passive, income.
Depending on your approach, your investments could reap rewards with almost zero work on your end.
“Real estate offers a continuum of effort that the investor can put in,” says Scott Trench — and he should know. He’s a personal finance author, house-hacking guru (more on that in a sec!) and the CEO of BiggerPockets.
Oh, and did we mention he’s a real estate investor whose properties have him on track for early retirement… even though he’s yet to celebrate his 30th birthday?
“I like to think of it as a semi-passive business,” Trench says.
When properly managed, investments like rental properties can earn help you earn a hefty paycheck for relatively little work — but it’s also pretty easy to scale the business if you put that money back into your real estate projects.
If buying a whole house of your own is totally off the table, there’s also passive real estate investment to consider: opportunities to put money into real estate without actually purchasing your own property.
In many cases, you can get started on this kind of real estate investing for less than $1,000, and the returns can be substantial.
But before we dive into some specific ways to invest in real estate, let’s go over some key definitions. You’ve gotta talk the talk before you can walk the walk, whether it’s Boardwalk or Park Place you’re after!
Investing in Real Estate: The Lingo
Here are some of the most common terms you’ll hear thrown around in real estate investing circles.
Residential real estate refers to properties designed to be used as places to live. Single-family homes, townhouses and condominiums all count — though homes with more than four units, like apartment buildings and large multiplexes, are considered commercial property.
Commercial real estate is property used for business purposes, such as restaurant and retail space or office buildings.
As mentioned above, extra-large residential buildings are also considered commercial real estate, since they’re generally managed as businesses.
Industrial real estate is property where industrial businesses perform their functions, whether it’s factory space, shipping yards or storage warehouses.
You probably already know this one, but a landlord is someone who owns property and leases it out to a third party, usually for residential or commercial use.
A landlord is also known as a lessor.
A lessee, then, is the person renting the property, who’s also known as a tenant.
Rent is the money a landlord collects from the tenant as compensation for use of the property, usually taken on a monthly basis.
Appreciation is an asset’s increase in value over time. Real estate is one of the only tangible investments whose value tends to appreciate.
Interest is the price charged by a lender for the service of providing a loan, expressed as a percentage of the loan amount.
For instance, according to CalculateStuff.com’s APR calculator, if a borrower takes a $150,000 loan with a 5% APR interest rate, and repays the balance over a 30-year period, that borrower will end up paying the lender back a total of $289,885.27.
That means the lender earns $139,885.27 in interest! (Not a bad payoff, huh? But pretty scary from the borrower’s perspective!)
How to Invest in Real Estate: 3 Ways You May Not Have Thought of Yet
The most obvious way to get involved with real estate investing is, of course, to actually purchase property. And we’re going to go into that investment option in a few minutes.
But what if you want a piece of the real estate investing pie without signing a mortgage — or ever having to respond to a tenant’s 3 a.m. plumbing crisis?
There are actually a variety of passive real estate investment tactics that require nothing but your money. And you don’t necessarily have to have very much of it to start.
Just like investing in stocks, these real estate investment approaches allow you to earn money on the appreciation of the properties you’re backing… without requiring you to actually purchase or manage the property yourself.
1. Real Estate Investment Trusts (REITs)
A real estate investment trust is a company whose bread and butter is purchasing commercial real estate, with the express intent of funding properties that generate income.
REITs then sell shares of those real estate investments to outside investors, who earn money in the form of dividends.
In short, it’s just like investing in the stock market: You put your money on the table to back the company, and you reap returns when the company does well.
In this case, though, the company’s sole mission is to own, operate and finance real estate. So you’re basically buying tiny portions of a variety of different properties you may never even see or set foot on.
Depending on the type of REIT you’re talking about, you may be able to buy into the game for very little money.
Private REITs aren’t traded on the stock market, which means they’re generally unavailable to the average investor. With high fees and higher minimum investments, this is the domain of accredited investors with substantial net worth.
Publicly traded REITs, however, are available on the stock market — and if you have a brokerage account and enough capital to buy a share, you can go ahead and add it to your investment portfolio. However, these REITs do see substantial market volatility just like regular stocks, so it’s definitely not a risk-free investment.
There are also public, non-traded REITs, which aren’t available on the stock market but are registered with the SEC, or U.S. Securities and Exchange Commission. They sometimes carry high investment fees and minimums, but not always, and so may occasionally be an option for the average investor.
2. Crowdfunded Real Estate Investing
If you’re familiar with platforms like Kickstarter or Patreon, you already understand how crowdfunding works.
We found a company that helps you do just that for real estate.
You don’t have to have hundreds of thousands of dollars. You can get started with a minimum investment of just $500. A company called Fundrise does all the heavy lifting for you.
Through theFundrise Starter Portfolio, your money will be split into two portfolios that support private real estate around the United States.
3. Private Equity Funds and Opportunity Zone Funds
Private equity funds work kind of like mutual funds — or the crowdfunding platforms we just mentioned, but at a higher, less grassroots level.
They still work by pooling the assets of many investors to make high-value investments but are generally limited to accredited investors who can put down at least $100,000.
Opportunity zone funds are another type of pooled-asset investment strategy, but they’re specifically geared toward backing developments in economically distressed U.S. neighborhoods.
Because they help stimulate needed growth in those areas, they’re subject to some pretty appealing tax incentives — especially if you leave your money in the fund for a substantial period of time.
For instance, if you retain an opportunity zone fund holding for five years, your tax liability on capital gains (i.e., earnings made through appreciation) is reduced 10%. If you retain it seven years, the reduction is bumped to 15% — and if you can afford to leave the money tied up for a decade, you won’t pay any capital gains taxes.
That makes backing opportunity zone funds a very interesting option indeed for a qualified investor looking for a long-term investment opportunity.
But again, depending on the fund you choose, you may be subject to an investment minimum of as much as $250,000.
Investing in Real Estate the Old-School Way: Buying Property
If you are on board to become a bona fide property owner — the kind who can actually put the key in the door — there are ways to make buying a home, which is already usually a smart money move, into an even smarter investment.
For those of you ready to sign a mortgage (or even buy a house in cash!), here are some income-generating tactics to consider as you enter the real estate market.
Ever dream of living rent- (or mortgage-) free?
House hacking is all about making that dream possible. (And it’s also how Scott Trench, the real estate investor we mentioned above, got his start.)
Basically, you find a property that you can simultaneously live in and rent — in many cases, a duplex with two separate living areas.
You then use the money you earn as a landlord to eradicate your mortgage payments quickly, ideally eclipsing your monthly payment entirely.
Trench in particular used house hacking as a ladder to get his start as landlord with multiple rental properties.
After he paid off his first duplex, the rent he was earning was pure profit, which he was then able to reinvest in more properties… which earned him even more rent. (Genius, right?)
The best part of house hacking is that it takes a necessary living expense — i.e., keeping a roof over your head — and turns it into an earning opportunity.
So if you’re already looking to buy a home of your own, you may as well see if you can find one that’s hackable.
If you’ve ever magically lost an hour or three of your life by watching the nigh-pornographic property transformations on HGTV, you’re probably familiar with house flipping.
And your experience of that rags-to-riches story doesn’t have to be limited to the TV screen. If you’re relatively handy and have an understanding of real estate values, you could try the tactic yourself.
The way it works is pretty simple, on the surface: You purchase an investment property that could use some TLC — a “fixer-upper,” in common parlance — and put in the repairs and remodels necessary to make it nice and shiny.
The value of the house goes up, at which point you can sell the property for a profit.
It’s important to note, however, that this is one of the most work-intensive ways to invest in real estate. And you do stand to lose a whole lot of money if you don’t do it right.
Renovations are already expensive, and if the house sits empty on the market, you could lose even more money — both in opportunity cost and actual charges, like property taxes.
In other words, this approach is not for the total real estate investing beginner!
Airbnb and Other Vacation Sublets
As anyone who’s taken a vacation in the past five years knows, hotels are so last century.
Nowadays, it’s all about the intimacy, convenience, and relative affordability of peer-to-peer short-term rental accommodations, like the ones available on Airbnb.
If the home you buy has a spare bedroom — or better yet, an outbuilding or separate in-law quarters — you can use that space to turn a tidy profit.
Just be sure you look into the regulations in your area first. Some cities have enacted a short-term rental permit or licensing program in order to ensure enough housing remains available for permanent residents.
As you can see, there are many ways to get started in real estate investing, even if you don’t have the cash to buy a rental property outright.
And who knows? If you play your cards right, the returns you make may just put you in mogul territory — or at least keep a roof over your head.
Jamie Cattanach’s work has been featured at Fodor’s, Yahoo, SELF, The Huffington Post, The Motley Fool, Roads & Kingdoms and other outlets. Learn more at www.jamiecattanach.com.
This was originally published on The Penny Hoarder, which helps millions of readers worldwide earn and save money by sharing unique job opportunities, personal stories, freebies and more. The Inc. 5000 ranked The Penny Hoarder as the fastest-growing private media company in the U.S. in 2017.
It’s good to be the boss. People in charge of an organization not only make more money, but they also have happier family lives, are more satisfied with their work, and worry less about their financial futures, according to a 2014 Pew Research report. Those in the top levels consider their employment a “career,” not just a job that pays the bills.
So what can you do to get a promotion to those top levels? There are a number of steps you can take to improve your chances of advancing your career, whether with your existing employer or a new one. Your long-term success depends on having as many options as possible and being prepared when an opportunity arises.
11 Ways to Advance in Your Career
Getting to the top of the corporate food chain becomes increasingly more difficult in the higher tiers of management. In many organizations, average performers in the lower ranks can expect some promotions by merely being competent and building tenure. Attaining more senior positions or advancing at a faster rate, however, requires the following strategies, at the very least.
1. Evaluate Corporate Opportunities
The more opportunities available to you, the better. For example, a rapidly growing company depends on numerous managers to implement its strategies, whether that’s introducing new products, expanding into new geographic territories, or capturing a larger market share. At the same time, a growing company typically takes risks to meet profit targets or expand into new markets.
Successful small companies can become acquisition targets for larger competitors. If their efforts are successful, the acquirer typically cuts redundant staff and replaces poor and average performers with their own people. In other words, the choice to work for a small growing company is a high-risk, high-reward proposition for an ambitious employee.
On the other hand, mature companies that already dominate an industry may have slower career paths but provide valuable experience and security for those willing to wait for their turn in corporate leadership. If the company chooses to blend acquisitions and internal growth to achieve profit targets, the opportunities for advancement can exceed those of a smaller company, with less risk.
That said, many mature companies have policies aimed at inducing turnover at the top levels. They may offer early retirements, buyouts, and titles with higher compensation but no authority or responsibility — a kind of in-place retirement — to retain younger, aggressive managers who might otherwise leave the company. Your selection of an employer is a critical element in how fast you climb the ranks.
Identify the most important aspects of an employer for you. For example, do you seek financial security or the opportunity for rapid advancement? Are you willing to sacrifice leisure time for a promotion? Are you competitive or more passive? Do you work best as an individual or part of a team? Where does work fit into your priorities?
Gather as much information about potential employers as possible. Public companies’ required disclosures are easy to access, newspapers and magazines often run articles on local companies and businessmen, and most companies have websites with information on various facets of the company. Review comments about potential employers on sites like Glassdoor, Vault, and PayScale, remembering that some reviews may be negatively biased. If possible, talk to current and former employees. If you find anything that concerns you, ask the company’s recruiter for an explanation. After all, you’re making one of the most important decisions of your life.
2. Get the Lay of the Land
Every company has a culture, whether intentionally or informally developed. It’s the company’s personality and includes shared values, ethics, and expectations that govern employee behavior. Ignoring an established culture is one of the worst errors a new employee can make; it’s effectively inviting battles without knowing your foes or having a battle plan.
A company’s public statements and recruitment conversations can vary significantly from acceptable day-to-day behavior. As a consequence, new employees eager to make a significant impression may be admonished with the comment “That’s not the way we do things around here.” Before implementing your plan to get ahead, take the time to understand the rules of the game you’re playing.
3. Avoid Company Politics
Company politics are a fact of life in any organization, especially businesses. According to research published in Trends in Cognitive Sciences, the desire to climb the corporate hierarchy stems from an innate need for power and control found in all humans. As a consequence, cliques and factions arise, especially around those contending for the corner office. Participating in company politics is always a risk since being associated with the wrong side invariably leads to career setbacks.
Some years ago, I advised a newly hired CEO of a major public company, who had been brought in from the outside due to the board’s unwillingness to choose one of two senior vice-presidents vying for the position. Enmity between the two officers’ supporters was overt and destructive. Despite the reputations of the two rivals — both were considered highly capable in industry circles — the CEO replaced both men, sending a message to the remaining officers that results, not politics, would be the basis for future promotion. The executives lost their positions, and their perceived followers’ careers also stalled. If you want to get ahead, avoid unhealthy alliances and personal conflicts with other employees. Treat all people with respect and courtesy.
4. Get Noticed by Those Who Matter
It doesn’t matter if you’re an expert in a particular field if no one knows who you are. Companies are filled with nameless employees who spend years toiling in the trenches without recognition. To ensure you get the recognition you deserve:
Seek Employer Feedback. Many employees passively wait for their annual or semiannual employee reviews. Unfortunately, these reviews are often merely attempts to justify terminations or avoid lawsuits. Develop the habit of seeking feedback from your direct supervisor regularly, especially after every project. Take note of compliments and criticisms, modify your performance where necessary, and involve your boss in those efforts; your achievement reflects well on them.
Volunteer for Extra Work. Look for ways to make your superior’s job easier. Employees who help their bosses stand out become visible to other supervisors who may have opportunities as well. When you take on extra work, be sure you complete the assignment on time and as expected.
Participate in Company Activities. Being active in company social events, sports teams, and sponsored charities exposes you to more people who can help you on your climb to the top. Whenever possible, do favors for other employees without any expectation of a quid pro quo. Over the course of your career, you never know who might help you with a recommendation, introduction, or valuable advice.
When employing these strategies, be sure to proceed thoughtfully. They can easily be misunderstood by your superiors and resented by your fellow workers if done inappropriately. Remember, it’s important that your efforts be sincere and not viewed as attempts to fool colleagues or ingratiate yourself with a boss. To impress your superiors, seek to convey an attitude of selflessness, not selfishness.
5. Find Mentors
Business mogul Richard Branson, the founder of Virgin Group Ltd., has said that mentoring is the missing link between a promising businessperson and a successful one. He advises that success takes “hard work, hard work, and more hard work. But it also takes a little help along the way.” Even geniuses need help now and then; in a letter to fellow scientist Robert Hooke in 1675, Sir Isaac Newton wrote, “If I have seen further [than other scientists of the time], it is by standing upon the shoulders of giants.”
A mentor is someone who has traveled the path before you, knows the ins and outs of an industry or organization and its people, and is willing to give you authentic, unvarnished assessments and advice. Mentors may be within or outside your own company. A good mentoring relationship can speed up your progress, smooth bumps in the road, and help you avoid the obstacles that can derail or destroy a career.
Finding a mentor is more than identifying someone you can exploit for their contacts and sponsorship. Mentoring is a two-way relationship, much like that between a pupil and teacher. Find mentors who recognize your talent, genuinely care for you, and expose you to other successful people. Don’t be afraid to ask for assistance and advice; the most successful people had help along their journeys, and many of them are willing to give back.
Consider having several mentors at once, much as a CEO works with a board of directors. In my career, I’ve been fortunate to have the advice of many wiser and more-experienced businesspeople. In most cases, our relationships spanned a lifetime — hopefully, a mutual pleasure, but certainly to my great advantage.
6. Nourish Your Network
As you progress in your career, spending time at different management levels and possibly other companies, there are ample opportunities to make valuable business and personal contacts that may be helpful as time goes by. Unfortunately, most people jump from one position to another, eventually forsaking comrades of the past to embrace those of the present.
Apart from the lost emotional benefits of sustained personal and business relationships, career nomads squander the opportunity of their former colleagues’ advice and experience. President George H.W. Bush was well-known for the thickness of his Rolodex, a collection of acquaintances, friends, and business associates accumulated over a lifetime. He maintained his network through occasional favors, letters, cards, and phone calls. A significant factor in the elder Bush’s success was his ability to reach out for advice and assistance when needed. Many political observers credit the political success of George W. Bush to his father’s contacts.
Maintaining a network can be tedious and tiring at times, but the benefits more than justify the effort to stay in touch. Friendship is reciprocal. When it is possible to help someone, do so gladly, with no strings attached. Never burn bridges, and keep your relationships in good shape.
The value of a network grows as it expands and is nourished with thoughtful effort. The young woman sitting in the adjacent cubicle may be the CEO of a Fortune 500 company one day, while a golfing buddy may rise through the ranks of executives at your biggest supplier.
7. Put Your Best Foot Forward
Attracting attention for the right reasons is critical because promotions are not just the outcome of visibility, luck, or mentorship. If your work habits, capabilities, and track record are not exceptional, you’re unlikely to get the rewards you seek. A mediocre performance usually results in a mediocre career, so if you want to get ahead, you must bring something extra to the table.
Some people are extraordinary because they achieve an unlikely and unexpected result in a single instance — for example, the super-salesman who breaks a long-standing sales record, the engineer who designs a new product, or the production manager who significantly improves quality without cost increases. Other folks stand out from the crowd because they consistently deliver the goods every time without excessive supervision, delay, or histrionics; they’re the “no muss, no fuss” people supervisors can always rely on. Anyone willing to put in the work can stand out as extraordinary; it’s more a matter of attitude and effort than skill or knowledge.
8. Maintain an Optimum Skill Set
If you lack the minimum requirements to practice your profession, no mentor, connections, or experience can enable you to do your job. Depending on your field, there are likely to be minimum technical capabilities and educational benchmarks you must master to perform at any level, much less advance.
Also, specific management and personal skills are always in demand. Those who master these skills are the formal and informal leaders who can influence others and promote exceptional results. Examples of highly sought-after skills include:
Strong Communication Skills. As you progress up the management ladder, the ability to educate, persuade, manage, and motivate subordinates and peers is essential. Similarly, you must communicate expertly to superiors.
Social Competence. As you ascend in an organization, reliance upon and rapport with direct reports and superiors is essential. Those most likely to promote you are the ones whose careers depend upon your performance. Develop and practice the traits of steadiness, consistency, truthfulness, dependability, and charm.
Problem-Solving. Critical thinking — the ability to dissect a problem, identify root causes, understand relationships, and rationally assess likely outcomes — is a highly valued skill in every level of an organization. Critical thinkers can minimize the consequence of potential disasters and recognize overlooked opportunities. And like many skills, critical thinking is something you can learn and practice. For example, the University of Massachusetts’ decision-making process can teach you how to better control your emotions under stress. Through time and practice, these skills will become second-nature.
9. Recover From Setbacks
Unless you’re the boss’s son or daughter, your career path is likely to be uneven, with periods of apparent stagnation and occasional failure. Setbacks can be self-inflicted or out of the blue, such as not getting a promotion or raise you expected, receiving a poor performance review, or the failure of a project you’re working on. Whatever the nature or cause, learning how to react to disappointment is critical to getting back on the right track.
According to a poll reported by Harvard Business Review, one in five employees who experience a setback take no personal responsibility and blame others for the failure. They also take too much credit for their successes. In their anger and disappointment, these employees are most likely to quit either on the job or formally, compounding the severity of the consequences.
My first job after I graduated from college with a degree in industrial engineering was with one of the largest farm equipment manufacturers in the world. My plant employed more than 3,000 workers, most of whom were members of the UAW labor union and therefore covered by a comprehensive bargaining agreement. Midway through my first year, I decided that union members in a particular department were circumventing work rules and costing the company over $1 million annually.
When I expressed my feeling to my manager, he disagreed with my conclusion and directed me to focus on my regular duties. Being young and confident I was right, I continued to pursue the project, ultimately producing a multi-page report complete with pictures and operating data.
Chafing under the previous criticism, I did not consult with my manager but sent my report over his head to the plant manager. I then waited for the accolades that were sure to come, perhaps an immediate raise or promotion. Much to my surprise, the reaction was an official black mark on my company record and a profanity-filled lecture from my boss. Like the 20% in the Harvard poll, I was sure my analysis was correct and that I had been treated unfairly. I left the company three months later.
After considerable self-analysis and feedback from friends and family, I realized that my actions had triggered the event and my inflated ego was the cause. Accepting that I didn’t know everything and regularly made mistakes was difficult to acknowledge but enabled me to become a better employee and manager in later years. From that early experience, I learned to limit my self-pity and disappointment and instead conduct a thoughtful analysis of disappointing situations: What went wrong? What were the causes? What had I done right? What had I done wrong? What steps could I take to avoid a repeat incident?
I apply a similar attitude to success, relying on the wisdom attributed to Winston Churchill: “Success is not final; failure is not fatal; it is the courage to continue that counts.”
10. Know When to Change Course
Unfortunately, there may be times when circumstances dictate a new beginning or company. The trigger might be an unexpected call from a headhunter offering a promotion and a substantial raise, or when those most familiar with your work overlook your capabilities or achievements. You may be in a situation where corporate history dictates promotion policies that aren’t to your benefit. In such cases, your best alternative may be to seek opportunity elsewhere.
For example, I left a comfortable position with a Wall Street firm to become the chief financial officer of a technology firm, which I subsequently guided through a national public offering and several mergers and acquisitions. I returned to Wall Street finance after several years, becoming a specialty product manager with a regional investment boutique, a position that would have been unavailable without my time as a CFO. These combined experiences enabled me to form an oil and gas exploration firm and accomplish a multi-million-dollar public stock offering before age 35.
11. Be Patient
Ambition is a double-edged sword. Brandished with reason and restraint, it can spur you to efforts and achievements you never dreamed possible. However, when unfulfilled, it can leave you feeling bitter, empty, and alone.
As a young man in a dominant Wall Street firm in the 1960s, I hungrily sought promotion into office management. In those days, conventional wisdom was that employees under the age of 35 lacked the experience and composure to successfully manage a retail brokerage office, especially with older representatives who had more experience.
Frustrated with a policy that seemed antiquated, I resigned from the firm and sought employment elsewhere. As a consequence of my departure, and that of others from the training programs, the firm changed its policies — to the benefit of my more patient former colleagues who had stayed put. In the two years following my resignation, many of these colleagues were promoted to office management with higher salaries and benefits before the age of 30. By Wall Street standards, their rise in the ranks was unprecedented.
Career progression rarely occurs as quickly as we would like, and big companies have big bureaucracies that sometimes react slowly. However, the best-managed organizations, regardless of size, do ultimately correct their course. Exhibiting patience early in your career can pay off significantly later on.
While several skills are necessary to climb the corporate ranks, the best thing you can do is to take responsibility for your own career success. You have a significant number of competitors, many of whom are just as — if not more — qualified for a promotion. If you want success, you have to go after it. Be patient when patience is justified, but don’t be afraid to seek greener pastures when necessary.
Critical turning points occur throughout a person’s life and career. The decisions you make — or don’t make — can have lifelong impacts on your career, happiness, and fulfillment. Fortunately, few decisions are irreversible, so a single mistake doesn’t define your life or limit your future opportunities. Be bold in setting your goals and resilient when setbacks appear.
How do you intend to climb the corporate ladder? What have you done to get to the point you’re at currently?
Sallie Mae’s inaugural report delving into how Americans pay for graduate school revealed that a mere 12% of students base their decision to pursue an advanced degree on the cost.
While many students who participated in the study said they view graduate school as an investment in their future (and quite often it is), that statistic is particularly startling considering the record levels of student debt in this country (around $1.5 trillion at last count).
It’s also somewhat concerning in light of the fact that a graduate degree in many professions doesn’t guarantee an increase in one’s salary. Sallie Mae found that nine in 10 graduate school students believe the additional degree will translate into improved earnings, but in reality a salary increase depends largely on the profession chosen.
“Enrolling in graduate school is a huge decision, which can alter the course of your life and career — often for the better, but not always,” says William Lipovsky, CEO of the consumer information website First Quarter Finance. “Though a master’s degree can increase your skill level and earning potential, it’s also a costly venture and a financial risk.”
For all of these reasons and more, it’s important to ask yourself some key questions before signing on for graduate school and the mountain of debt that often comes along with that decision.
What’s the Total Cost of Going to Grad School?
It should go without saying that the tuition associated with obtaining an advanced degree is merely part of the cost of attending graduate school.
To get a truly accurate picture of what the entire experience will set you back, it’s a good idea to conduct a comprehensive analysis of all the expenses associated with pursuing the additional degree.
For Camilo Maldonado, who at 26 years old decided to obtain an MBA from Harvard University, the program itself cost $185,000. “But if you factor in the fact that I left my job, since I was in a full-time MBA program and didn’t work for two years, the total jumps to nearly $400,000, including my lost wages,” explained Maldonado.
Calculating the full cost of attendance is a critical part of determining whether you can really afford the school you’re considering, as well as whether obtaining the degree is a sound financial decision. To fully resolve these questions, however, you’ll need to do some more legwork.
Will This Degree Boost My Salary Enough to Pay Back My Student Loans?
According to Sallie Mae, 53% of students attending graduate school pay for the experience with loans. Maldonado, for instance, obtained about $57,600 in financial aid and took out loans for $120,000.
Before following a similar path, research how much you stand to make in your chosen field of work, says Lewis Goldman, of LendKey Technologies, which helps community banks and credit unions source student loans online.
There are numerous websites that provide specific salary data broken down by profession. Glassdoor, PayScale, and Monster are a few examples. But you can also just Google the salary for the profession in question, said Goldman.
The goal is to find out if you’ll be bringing home enough money to pay back your loan in a reasonable amount of time. Goldman suggests a fairly well-known rule of thumb: Don’t take on more debt than you stand to make in one year’s salary.
Why this particular benchmark? Because between interest and principle, if you’re paying 10% of the student loan each year, you can pay off the debt in 10 years or less as long as it’s less than your annual income. If the total debt exceeds your annual income, you’re likely to struggle to make loan payments and may need to extend the repayment term.
In other words, choose the degree and profession you’re investing in wisely.
“It will obviously depend on the degree, but clearly based on our data, those with STEM degrees are going to be in much better position to pay off student loans and get a better return versus people with other degrees,” said Goldman. “I would be careful if you’re considering human services and counseling degrees or museum studies, such as curator. Ultimately those are not career paths where you want to accumulate a lot of debt.”
Will I Be Able to Graduate?
There are many reasons one might start pursuing a graduate degree and ultimately not complete it. Perhaps a family member falls ill and requires care, causing the student to drop out. Or maybe the student discovers the degree program or field itself isn’t right for them.
These sorts of possibilities should be carefully weighed before diving into a graduate program of study, advises Patrick Mullane, executive director of Harvard Business School Online, who points out that only 61% of students who begin a master’s degree actually complete it.
“Consider some worst-case scenarios – is there a chance you won’t finish your degree? This is a very important question,” said Mullane. “Students who don’t complete a degree still incur student debt. That’s the worst place to be – you don’t get the benefit of the graduate degree, but you have all the burden of a student loan. If you’re not sure about it, take your time and be sure to do your homework so you have a good idea if it’s worth it.”
Why Do I Need This Degree Right Now, and How Will It Benefit Me?
Granted, this is really two questions, but they’re closely related. And the “benefits” in this case aren’t just monetary, which we’ve already discussed. Sometimes an advanced degree can open doors that may otherwise remain shut.
Timothy Wiedman, a retired associate professor of management and human resources from Doane University, suggests that if you’ve been job hunting for quite some time and been told by prospective employers that a graduate degree would help your candidacy, then it may make sense to invest in advanced education.
The same logic applies to the question of how you might benefit from such a degree. “Perhaps the career field you’ve chosen really requires graduate coursework,” says Wiedman. “Or you want to work for a Wall Street firm, and these days they almost never hire anybody who doesn’t have an MBA.”
What Is the Value of the Institution I’m Considering?
Where you go to school does matter. It’s not fair, but it’s a reality, at least according to Mullane.
“It doesn’t mean that the Ivy League is the only option. But it does mean that paying a king’s ransom to go to any school no matter its brand reputation is probably not prudent,” he explained. “If you can’t go to a top-tier university, your state schools may be the best bet.”
To help determine the value of the schools you’re considering, do some research (this grad school tool from US News & World Report is a good place to start). Also consider asking for input on a prospective school from professionals in your field or your undergraduate career counseling office.
Where Will I Live After Graduation?
One last bit of advice: Think about where you plan to live after graduating with your shiny new degree. This is important because degrees are surprisingly regional, says Mullane.
“Networks of graduates tend to cluster in the towns and cities around a university. And networks are what might matter most when it comes to job hunting,” said Mullane. “While it shouldn’t be the single deciding factor in where you go to school, it is an important consideration.”
Mia Tayloris an award-winning journalist with more than two decades of experience. She has worked for some of the nation’s best-known news organizations, including the Atlanta Journal-Constitution and the San Diego Union-Tribune.
With so many possible side hustles available in today’s gig economy, how do you decide which to choose?
Today, I want to make the case that driving with for a rideshare company is a plausible choice for several reasons. But there are also some major distractions that you should be aware of before signing up.
My name is Josh Overmyer. I’ve completed over 2900 rides as an Uber/UberEats driver-partner since 2014. I know what you’re thinking: “That’s a lot of rides!” It is. And I’ve learned a lot in that time.
Here are my biggest takeaways from four years as a rideshare driver.
The Pros of Becoming a Rideshare Driver
Here’s the good news. You likely already have the knowledge and equipment necessary to be a rideshare driver!
All of these services are app-based and run on a smartphone, by drivers like you who successfully navigate their communities daily. You probably already know where the popular hang-outs are located, how to get around on your city’s streets, and maybe even alternate routes when roads are backed up.
The particulars of the vehicle will change depending on which service you’re signing up to drive for. But for passenger trips, you usually need a four-door vehicle, while food/parcel delivery may be possible with a two- or three-door car. (Drivers are subject to a criminal background check and a driving record check.)
As with any independent contractor gig, the amount and timing of the hours you drive are completely up to you, within regulations.
Some people will be comfortable driving the late-night crowd, which can be lucrative for rideshare drivers because of increased demand when passengers may have been out drinking.
Other drivers may stick to daytime hours and handle a more business-like crowd of people heading to/from jobs, doctor appointments, church, the grocery or the airport. Since your pay will generally be influenced by the number of trips you complete, when you need to make more money, you’ll probably want to drive more hours.
Some of the networks now allow the driver to set a destination and get trip requests heading in the same general direction. This helps you to maximize both your time and mileage driven for the maximum possible gain, since you’d be driving those miles with or without a rideshare app running on your phone, such as your daily commute or when you are running errands.
Speaking of maximizing time and costs, driving rideshare could allow you to turn certain everyday life expenses into qualified business expenses.
As I mentioned above, you’ll need a smartphone with a data plan, which you probably already have. Now it could be a deductible business expense! Miles driven or other driving expenses could be deductible as well, but you’ll need to keep meticulous records.
The Cons of Becoming a Rideshare Driver
There are some downsides to becoming a rideshare driver.
Simply driving with a rideshare company means extra wear and tear on your vehicle. Every additional mile you drive is one less mile that your car will last over the long-term.
Extra driving means more fuel costs, more wear and tear of consumables such as tires & brakes, and you’ll need more frequent oil changes.
As a result of all these extra costs and wear on your vehicle, you may face the additional cost of replacing your vehicle sooner than you had previously planned.
A good way to think about rideshare is that you are force-depreciating your current vehicle, which is to say you are extracting value out of your current vehicle to hopefully put money away for your next replacement vehicle.
Here’s another thing to consider: inviting total strangers into your personal vehicle.
From my experience, most passengers will be normal, everyday people just going about their lives: trips to school or work, to the grocery store, church, or to the airport (or beach in my community). But they are still complete strangers, getting into your personal space, and often strangely sitting right behind you, the driver. It can be creepy!
Even worse are the strangers getting into your car who are not on their best behavior. Some are simply loud and obnoxious, and you get used to that from the young twenty-somethings. Some have spent hours at a cigar bar and reek of cigar smoke that permeates your car’s interior and the smell can linger for days.
Worse yet are the drunks who can’t handle their liquor; sometimes you’ll be lucky and they’ll give you enough warning to pull over to the side of the road — but other times they’ll make a mess in your car.
You might have read the last two paragraphs and decided that you don’t want to deal with unruly passengers but would still like to run a side business doing food or parcel delivery.
I’ve delivered some food orders with Uber Eats, but I ended up with very smelly foods that would stink up my car just before a typical passenger Uber trip, and I had orders that included ice cream or milkshakes that weren’t sealed properly by the restaurant, resulting in a sticky mess.
I had a trip that took me upwards of 40 minutes to complete from the time of food pickup to delivery because the restaurant didn’t have the food ready and the recipient’s phone was dead, and for my troubles I made $6…before costs.
Also remember that you’re purposely placing yourself in traffic, which we all hate.
Not only do you sit there idling, wasting time and fuel, but it drives up your blood pressure and stress. You’re also more likely to get involved in a fender-bender when there are more vehicles on the road, and when you are rushing to a pickup or trying to find a convenient parking spot near the food establishment, so you don’t waste too much time circling the block.
Even when you aren’t in bumper-to-bumper traffic, you may experience eye strain from constantly searching for obscure addresses or watching for pedestrians in congested areas such as downtown, at concert venue, or in entertainment districts. Combined with low-light situations, this makes you more likely to end up in an accident.
The Bottom Line
That’s a long list of pros and cons. After all of that — and after four years of driving rideshare — what’s my overall impression of this side hustle?
Rideshare is a pretty easy gig to get started in — but it won’t make you rich, despite what the radio and TV commercials were telling us all a few years ago. After all operational costs are considered, almost anything else you could think of trying would pay more!
That said, rideshare driving could be a good fit for someone in a temporary cash crunch and who isn’t worried about the longer-term impacts to their transportation budget.
As for me, I stopped driving rideshare after I got a new higher-paying day job last year. If you’d like to read more about the ups and downs of my 2,900+ trips as an Uber/UberEats driver-partner, check out the three-part series about my first side hustle, and why I ultimately decided to quit.
Author: Josh Overmyer
Josh is a single guy is his mid-30s and a veteran of rideshare, with 2,882 Uber and UberSelect trips completed since 2014. He lives and works in Southwest Florida, and writes about personal finance, travel hacking and his investing failures at joshovermyer.com.
Everyone knows that wages are taxed by the federal government, but Uncle Sam has a far-reaching definition of “taxable income.”
It covers numerous types of earnings that many people don’t realize are subject to federal income taxes.
What follows are several examples of taxable income that may come as a surprise.
1. Social Security retirement benefits
Generally, people pay federal income taxes on their benefits if they have other substantial income — such as wages, interest or dividends — as we detail in “5 Ways to Avoid Paying Taxes on Your Social Security Benefits.”
If Social Security benefits are your sole source of retirement income, or you have little income in addition to your benefits, your benefits likely would not be subject to federal income taxes.
As of January, the average monthly benefit for retired workers was about $1,464 — for a total of $17,568 per year. That’s well below the taxable threshold for individual tax-return filers — whose benefits are taxable only if what the Social Security Administration calls their “combined income” is between $25,000 and $34,000.
2. Alaska Permanent Fund dividends
When we named Anchorage, Alaska, among the best domestic retirement destinations of the year, we mentioned the Alaska Permanent Fund.
“The 25 Best Places in the U.S. to Retire in 2019” explains:
“Yes, it may be cold, and, yes, it may be expensive. But once you’ve been a resident for a year, you may be entitled to receive the annual dividend from the oil-revenue-supported Alaska Permanent Fund. In 2018, the fund paid $1,600 per person. However, that’s not the only reason to retire to Anchorage.”
But dividends for adults, and sometimes dividends for children, are subject to federal income taxes, notes the Alaska Department of Revenue.
Fail to report Alaska Permanent Fund dividends on your federal tax return, and you may be hit with a negligence penalty or other sanctions, the state agency warns.
The IRS expects people to report income from bribes on their tax returns.
“If you receive a bribe, include it in your income,” the federal agency plainly states in Publication 17.
4. Illegal activities
Even criminals are expected to report their income — including income from illegal activities, such as earnings from selling illegal drugs.
Don’t scoff at the thought. Remember, notorious Chicago gangster Al Capone was imprisoned for tax evasion.
For divorce and separation agreements executed before 2019, alimony is generally deductible by the payer, and the recipient generally must report it as income.
This changes for agreements executed after Dec. 31, 2018, though, notes H&R Block. Per changes to the tax code from the Tax Cuts and Jobs Act of 2017, alimony payers cannot deduct payments, and alimony recipients will not count payments as income.
6. Canceled debts
If you were fortunate enough to convince someone to cancel a debt in 2018, you probably felt a sense of relief. The problem is that you may not be entirely off the hook.
Generally, if a debt is forgiven, unless it’s intended as a gift, the IRS expects you to count the canceled amount as income when you file your federal taxes.
7. Gambling winnings
The euphoria you feel when you win at gambling may quickly fade once you realize that the IRS expects you to pay taxes on your windfall.
And this isn’t only about what happens in casinos. Winnings from lotteries and raffles also must be reported to the IRS as income.
You can, however, use gambling losses that occurred during the same year as your winnings to offset your tax burden.
You cannot avoid paying taxes by accepting goods or services instead of cash for your work. Generally, you must include the fair market value of those goods or services in your income.
An example from the IRS:
“You’re a self-employed attorney who performs legal services for a client, a small corporation. The corporation gives you shares of its stock as payment for your services. You must include the fair market value of the shares in your income on Schedule C (Form 1040) or Schedule C-EZ (Form 1040) in the year you receive them.”
How many of these things did you realize were taxable? Let us know by commenting below or on our Facebook page.
Interest rates on certificates of deposit have been rising, but that won’t last forever. Most CDs, unlike regular savings accounts, have fixed rates, so you can lock in a high rate before a bank lowers its CD offerings.
Here’s a look at current CD rates at some online banks and credit unions.
» Want to compare more CDs? Check out our best CD rates