MONEY Savings

When Good Investments Are Bad for Your Retirement Savings

Q: I have an investment portfolio outside of my retirement plans. That portfolio kicks out dividend and interest income. If I roll all that passive income back into my portfolio, can I count that toward my retirement savings rate? — Scott King, Kansas City, Mo.

A: No. The interest income and dividends that your portfolio generates are part of your portfolio’s total return, says Drew Taylor, a managing director at investment advisory firm Halbert Hargrove in Long Beach, Calif. “Counting income from your portfolio as savings would be double counting.”

There are two parts to total return: capital appreciation and income. Capital appreciation is simply when your investments increase in value. For example, if a stock you invest in rises in price, then the capital you invested appreciates. The other half of the equation is income, which can come from interest paid by fixed-income investments such as bonds, or through stock dividends.

If your portfolio generates a lot income from dividends and bonds, that’s a good thing. Reinvesting it while you’re in saving mode rather than taking it as income to spend will boost your total return.

But dividends can get cut and interest rates can fluctuate, so counting those as part of your savings rate is risky. “The only reliable way to meet your savings goal is to save the money you earn,” says John C. Abusaid, president of Halbert Hargrove.

It’s understandable why you’d want to count income in your savings rate. The amount you need to save for retirement can be daunting. Financial advisers recommend saving 10% to 15% of your income annually starting in your 20s. The goal is to end up with about 10 times your final annual earnings by the time you quit working.

How much you need to put away now depends on how much you have already saved and the lifestyle you want when you are older. To get a more precise read on whether you are on track to your goals, use a retirement calculator like this one from T. Rowe Price.

It’s great that you are saving outside of your retirement plans. While 401(k)s and IRAs are the best way to save for retirement and provide a generous tax break, you are still limited in how much you can put away: $18,000 this year in a 401(k) and $5,500 for an IRA. If you’re over 50, you can put away another $6,000 in your 401(k) and $1,000 in an IRA.

That’s a lot of money. “But if you’re playing catch-up or want to live a more lavish lifestyle when you retire, you may have to do more than max out your 401(k) and IRAs,” Taylor says.

Read next: How to Prepare for the Next Market Meltdown

MONEY job interview

‘What Should I Have Said When an Interviewer Asked If I Would Work Unpaid Overtime?’

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Mark Weiss—Getty Images

Q: A job interviewer asked me if I would work unpaid overtime. How should I have answered?

At a recent second interview for a database analyst position, the interviewer stated, “This is a contract position – no benefits,” then asked “How do you feel about doing unpaid overtime?” with a clear verbal intonation suggesting the “right” answer. The interviewer was unable/unwilling to state how many overtime hours or how often overtime is required. Is there a way to answer this without being immediately dismissed from consideration? Can one negotiate how many “standard” vs. “overtime” hours one is willing to work? Is this even legal to ask?

A: If it’s an exempt position, they’re not required to pay overtime, and thus there’s nothing illegal about asking, essentially, “are you willing to work long hours?” On the other hand, if the position is non-exempt (and there are non-exempt tech positions; I don’t know if this was one of them or not), asking someone to work unpaid overtime is announcing you plan to break the law.

I’d respond by asking, “Can you give me a sense of how many hours people in this position work in an average week?” If the person refused to answer — which I think is what you’re saying happened here — I’d take that as a massive red flag. It’s basically an announcement that they’re going to wildly overwork you and not even do you the courtesy of having an honest conversation with you about what your work life would be like there.

You asked how to answer without being dismissed from consideration, but there’s no reason to want to stay in the running at that point. Remember you’re supposed to be interviewing them right back and deciding if you even want the job, not just waiting to be chosen.

Q: I never got the raise I was promised. Should I say something?

I worked as a pharmacist assistant in high school (part-time during school and full-time in the summer) for about a year and a half, then had to move to another city for university. Then, after first year, I came back to the same place for the summer, and my manager told me that he would adjust my rate. But I got my first pay check today and the rate is the same as what I had in high school. How should I approach my manager?

A: “Hey Fergus, you had mentioned that you were increasing my pay rate this summer. I just got my first check and don’t see the increase on there. Is there something we need to do to make it go through?”

Assume it was an oversight and go from there.

Read next: The Secret Formula that Will Set You Apart in a Salary Negotiation

These questions are adapted from ones that originally appeared on Ask a Manager. Some questions have been edited for length.

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MONEY Medicare

How to Time Your Medicare Enrollment

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Robert A. Di Ieso, Jr.

Q: When should I sign up for Medicare?

A: Most pre-retirees know that Medicare coverage kicks in when you turn 65. But that’s not the whole story. If you want to enroll in Medicare without hassles and costly penalties, you need to know exactly when to sign up for the program you want. There are different enrollment periods, so it’s trickier than you might think. Many older Americans fail to sign up at the right time, which can lead to higher premiums or leave you with coverage gaps, studies have found.

First, though, there are exceptions to the age 65 sign-up date. You may still be covered by your employer’s health care plan, for example, or if you are eligible for Medicare due to a disability, you can sign up earlier.

Initial Enrollment Window: Medicare has established a seven-month Initial Enrollment Period, which includes the three months before you turn 65, your birthday month, and the three months afterward. This window applies to all forms of Medicare—Parts A (hospital), B (doctor and outpatient expenses), C (Medicare Advantage), and D (prescription drugs).

Medigap Enrollment: There is a separate six-month open enrollment period for Medicare Supplement policies (also called Medigap), which begins when you’ve turned 65 and are enrolled in Part B. During this period, insurers must sell you any Medigap policy they offer, and they can’t charge you more because of your age or health condition. This guaranteed access may be crucial because if you miss this window and try to buy a Medigap policy later, insurers may not be obligated to sell you a policy and may be able to charge you more money.

General Enrollment: If you missed enrolling in Part A or B during the Initial Enrollment Period, there is also a General Enrollment Period from January 1 through March 31 each year. Waiting until this period could, however, trigger lifetime premium surcharges for late Part B enrollment, which can end up costing you thousands of dollars. And your coverage won’t begin until July.

Part D drug coverage is not legally required. But if you don’t sign up for it when you first can, and later decide you want it, you will face potentially large premium surcharges. For example, if you missed enrolling during your initial enrollment period and then bought a policy, a premium surcharge would later take effect if you were without Part D coverage for 63 days.

Special Enrollment: There are lots of special conditions that can expand your penalty-free options for when you sign up for Medicare. And there also are what’s called Special Enrollment Periods for people who’ve moved, lost their employer group coverage or face other special circumstances. These special periods may have enrollment windows that differ in length from the standard ones.

Philip Moeller is an expert on retirement, aging, and health. He is co-author ofThe New York Times bestseller, “Get What’s Yours: The Secrets to Maxing Out Your Social Security,” and is working on a companion book about Medicare. Reach him at moeller.philip@gmail.com or @PhilMoeller on Twitter.

Read next: How to Make Sure Medicare Really Covers Your Hospital Stay

 

MONEY Ask the Expert

What’s the Difference Between an Index Fund, an ETF, and a Mutual Fund?

Investing illustration
Robert A. Di Ieso, Jr.

Q: What is the difference between index funds, ETFs, and mutual funds? — Gary

A: An easy way to think about it is this: Exchange-traded funds, or ETFs, are a subset of index funds; and index funds are a subset of mutual funds.

“It’s like a funnel,” says Christine Benz, director of personal finance at fund tracker Morningstar.

Let’s start with the broadest of the three categories: mutual funds.

What is a mutual fund

A mutual fund is a basket of stocks, bonds, or other types of assets. This basket is professionally managed by an investment company on behalf of investors who don’t have the time, know-how, or resources to buy a diversified collection of individual securities on their own.

In exchange, the fund charges investors a fee, which may run around 1% of assets annually or more. That means $100 for every $10,000 you invest.

In the case of most stock funds, holdings are selected by a portfolio manager, whose job it is to pick the stocks that he or she thinks are poised to perform the best while avoiding the clunkers. This process is referred to as “active management.”

But “active management” isn’t the only way to run a mutual fund.

What is an index fund

An index fund adheres to an entirely different strategy.

Instead of picking and choosing just those stocks that the portfolio manager thinks will outperform, an index fund buys all the shares that make up a particular index, like the Standard & Poor’s 500 index of blue chip stocks or the Russell 2000 index of small-company shares. The aim is to replicate the performance of that entire market.

But because index funds buy and hold rather than trade frequently — and require no analysts to research companies — they are much cheaper to operate. The Schwab S&P 500 Index fund, for example, charges just 0.09%, or $9 for every $10,000 you invest.

By definition, when you own all the stocks that make up a market, you’ll earn just “average” returns of all the stocks in that market. This raises the question: Who would want to settle for just “average” performance?

As it turns out, plenty of investors around the world. While it’s counter-intuitive, academic research has shown that the higher expenses associated with active management and the inherent difficulty of picking winning stocks consistently over long periods of time means that most funds that aim to beat the market actually end up behind in the long run.

“In general, active funds have not delivered impressive performance,” Benz says. Indeed, S&P Dow Jones Indices has studied the performance of actively managed funds. Over the past 10 years, less than 20% of actively managed blue chip stock funds have outperformed the S&P 500 index of blue chip stocks while fewer than 15% of small-company stock funds have beaten the Russell 2000 index of small-cap shares.

What are ETFs

Okay, index funds sound like a good bet. But what type of index fund should you go with?

Broadly speaking, there are two types. On the one hand, there are traditional index mutual funds like the Vanguard 500 Index. Then there are so-called exchange-traded funds, such as the SPDR S&P 500 ETF SPDR S&P 500 ETF SPY -0.54% .

Both will give you similar results, but they are structured somewhat differently.

For starters, with a mutual fund, you often buy and sell shares directly with the fund company. The fund company will let you trade those shares once a day, based on that day’s closing price.

ETFs, on the other hand, aren’t sold directly by fund companies. Instead, they are listed on an exchange, and you must have a brokerage account to buy and sell those shares. That convenience typically comes at a price: Just like with stocks, investors pay a brokerage commission whenever they buy and sell.

That means for small investors, traditional index mutual funds are often more cost effective. “If you are on the hook for trading costs, that can really eat into your returns,” says Benz.

On the other hand, because they are exchange traded, ETF shares can be traded throughout the day. Being able to trade in and out of funds during the day is a convenience that has proved popular for many investors. For the past decade exchange-traded funds have been one of the fastest growing corners of the fund business.

Read next: 5 Things You Didn’t Know About the World’s Biggest Bond Fund

MONEY Workplace

‘What Should I Have Done When a Coworker Made Hateful Comments About Caitlyn Jenner?’

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MLADEN ANTONOV—AFP/Getty Images

Q: I overheard a coworker making hateful comments about Caitlyn Jenner. What, if anything, should I do?

Today at lunchtime, I overheard the front desk worker in my office discussing with a member of our HR team the Arthur Ashe Courage Award that is being presented to Caitlyn Jenner. The front desk worker was complaining that the award was being given to “a freak”.

I was upset by this incident but I’m at loss on how to proceed. Initially I intended to go through established channels for reporting this sort of behavior (an anonymous hotline) as our company specifically calls for nondiscrimination based on gender identity and has harassment policies in place. Others have encouraged me to speak to the person directly instead.

So what do you think I should do?

A: Please speak up. Say something like this to your coworker: “This has been bothering me for a few days, so I wanted to speak to you about it. The other day, I overheard your conversation with Jane about Caitlyn Jenner, and what I heard was disrespectful and unkind. I can’t make you think differently, but I want to ask you not to make comments like that in the office.”

I’d base your decision about whether or not to report it on her reaction. If she’s defensive or hostile about it, then I’d be more inclined to report it. Someone spewing hate in your office, and in an office that specifically calls for non-discrimination around gender identity, is reasonable to speak up about.

Also, the person she was talking to was from HR? HR people in particular should know better than to stay silent at this kind of thing, so I hope that person spoke up. if they didn’t, that would be another nudge in favor of reporting.

Q: Should managers ask or tell when assigning work?

A: When dealing with people that work directly for me, should I ask them to do things or tell them to do things? Does telling someone to do something in a work environment come off as harsh? I always ask them to do things, but I’m starting to feel like asking them kind of makes me look weak.

Either is fine, if you’re saying it nicely and not barking orders like you are Caligula.

There’s nothing wrong with “Please talk to Fergus about the teapot design and see if you can find a solution to the spout issue” as long as you say it politely.

But thinking back over what I tend to use myself, I generally default to framing things as asking — “Could you do X by the end of the week?” … “Here’s a new project I’m hoping you can take on” … etc.

And really, in most cases when a work assignment from your manager is framed as a request, it’s pretty clear it’s a directive. People aren’t generally going to reply with “Nope.” But I default to requests — unless there’s a reason not to — because (a) it feels more respectful to me, and (b) it makes it easier for people to speak up when they’re worried about their ability to deliver; it invites people to tell you if, for example, there’s a deadline conflict or they have concerns about how realistic the request is.

However, there’s a third category beyond requests and directives that’s important to talk about: things that sound like suggestions. If you say something like, “Feel free to show me that report before you finalize it,” a lot of people will hear that as “you can show it to me if you want to, but you don’t have to.” Then you’ll end up getting frustrated that your “suggestion” wasn’t followed, and your staff will end up confused about your expectations. So if you definitely want someone to do something, make sure you’re not framing it as “you could…” or “feel free to…” or “one idea would be…” or other suggestion formulations.

Perhaps more important than any of this, though, I’m wondering about why you’re feeling like framing things as requests is making you look weak. That suggests that you’re either feeling insecure about your authority for your own reasons, or your team is unclear on roles and expectations, or something else is going on. I’d explore that piece of it — because in a healthy, functioning team, a manager’s authority won’t be compromised by politely asking people to do what they need done.

These questions are adapted from ones that originally appeared on Ask a Manager. Some questions have been edited for length.

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MONEY home improvement

How to Beat the High Cost of Replacement Windows

For Sale sign illustration
Robert A. Di Ieso, Jr.

Q: I don’t want to replace the gorgeous hundred-year-old windows in my house (especially not for the $1,500 each my contractor quoted me!), but the triple-track storms are another story. What would I have to spend to upgrade those?

A: You’ll be happy to know that new storm windows will produce nearly as much energy savings as full replacement windows at less than a quarter of the price—and they’ll reduce your house’s long-term window maintenance needs too.

Many of the same technologies used in replacement windows, such as weatherproof gaskets to stop drafts and low-emissivity glass that blocks the flow of heat through the pane, are standard in today’s storm windows too. And the storms will keep water away from the windowsill, which helps prevent rot in what is generally the most rot-prone spot on any old house.

“Your existing triple-tracks are probably decades old,” says contractor Les Fossel, of Restoration Resources in Alna, Maine, “which means they’re bare aluminum color, the rubber holding the glass is dried out and cracked, and the panes rattle in their tracks every time the wind blows.”

Here are four options that Fossel recommends to his clients. Any of them will upgrade both the appearance and effectiveness of your current storm windows.

Triple-tracks (about $200 per window, installed): These are the same traditional format you already have, with two glass panes and a screen, each set in its own track so it can be raised and lowered with the seasons and removed for cleaning. Factory made to your window sizes, today’s products are far more efficient than your aging units and will also be less noticeable because you can order them to match your house’s trim color.

Double-tracks (about $350 per window, installed): These factory-made storms also have two panes and a screen that you position up or down, but the three components live in only two channels. Rather than sliding them up and down, you remove the screen and/or window from their shared channel, then rearrange and reinstall them. This takes slightly more effort at the change of seasons, but it makes the storm about 1/4-inch thinner and therefore a bit less noticeable on your house.

Wood exterior storms ($500 per window, installed): A single pane of glass inside a contractor-built wood frame that’s painted to match the trim, this type of storm hangs from hooks mounted on the window trim and sits flush with the exterior trim for a nearly invisible look. You’ll want to also have a few screens made in the same fashion so you can swap them onto a few key windows seasonally to allow fresh air into the house.

Interior storms: ($150 per window, installed): These whole-window storms cover the window from the inside, maintaining the antique, stormless look of an old house. Factory made with thin aluminum frames painted to match your interior trim, they simply press tight inside the window opening. They won’t protect the sill from weather damage, but they look a whole lot better than those plastic shrink-wrap window insulation kits.

MONEY Ask the Expert

3 Simple Ways to Build a Low-Risk Portfolio

Investing illustration
Robert A. Di Ieso, Jr.

Q: My 89-year-old father has $750,000 after selling his Medtronic stock and paying capital gains. He’d like to make a low-risk investment with easy accessibility, but one that would give him more than a savings account. Any suggestions? — Karen

A: Before your father gets too focused on where he should reinvest the proceeds of this sale, it’s important to ask how this fits into the bigger picture of his finances, says Shari Burns, a chartered financial analyst and managing director with United Capital in Seattle.

Given the current state of the bond market — interest rates are very low but poised to move higher this year, which would threaten the value of older bonds — there is no simple answer for making a low-risk investment that is easily accessible and that pays more than just a savings account.

“Preserving principal is one priority, and getting a better return than a savings account is another,” says Burns, noting that any time you look for additional reward, you’re taking on additional risk.

With that in mind, your father needs to think about his priorities and his timeline. Let’s consider three scenarios:

Scenario # 1: He needs all the proceeds of the stock sale to support his cost of living.

Under this scenario, he should start with how much he needs and for roughly how many years. Working backwards will help him determine the right balance of risk and reward.

In simplistic terms, his $750,000 translates to $75,000 in annual income for the next 10 years. To keep up with inflation and preserve capital consider a mix of cash and individual bonds.

Burns suggests keeping $250,000 in a savings account to draw on over the next few years. “If short-term rates go up, then the interest on the savings account will rise,” she says.

Your dad can then invest the remaining $500,000 in a laddered bond portfolio of individual Treasury securities. A simple way to build such a “ladder” is to divide that money equally among Treasuries maturing in two-year increments, starting with 2-year notes and going out to 10-year securities.

At current rates, those Treasuries are paying out 0.72%, 1.29%, 1.74%, 2.07% and 2.33% respectively. So combined, this $500,000 ladder will average 1.63% per year or $8,140 in annual income for the first few years.

“As you spend down the savings account, you will replenish your cash as bonds mature in the years that remain,” she says. “After 10 years your portfolio will be depleted.” It’s important to point out that because your father is holding these bonds to maturity, rising rates aren’t a concern.

Scenario #2: He doesn’t need the additional income but will rest easy knowing it’s safe.

Under the second scenario — which we’ll venture to say is the most likely based on the size of this single holding – he will probably want to keep about 70% to 75% of these funds in cash and a short-term bond fund, such as the Vanguard Short-Term Bond Index VANGUARD SHORT-TERM BOND INDEX INV VBISX 0.19% .

The remaining 25% to 30% should go to a low-cost stock fund, such as the Schwab S&P 500 Index fund SCHWAB S&P 500 SWPPX -0.03% or the Vanguard Total World Stock Index fund VANGUARD TOTAL WORLD STK INDEX INV VTWSX 0.56% . “The stock portion of the portfolio will provide growth over time, which will keep the total portfolio ahead of inflation,” she says. Because neither the bond market nor the stock market are exactly cheap, however, it makes sense to dollar-cost average into these portfolios over the next six months to a year.

Scenario #3: He wants to preserve wealth to eventually pass this on to his heirs or charity.

Finally, if your father is more focused on long-term wealth preservation, he may want to rethink his goal and invest for the long term, she says. “He will want the capital to rise faster than inflation to maintain the purchasing power of his wealth,” she says. Use the same approach described above, only plan to bring the equity portion up to 50% to 60% of this segment of the portfolio.

Read next: The Low-Risk, High-Reward Way to Buy Your First Investment Property

MONEY Ask the Expert

Can Debt Collectors Go After My Retirement Savings in Court?

Ask the Expert Retirement illustration
Robert A. Di Ieso, Jr.

Q: My wife retired late last year and we are thinking about rolling some of her 401(k) assets into an IRA account. We live in California and understand that the protections from creditors and in bankruptcy vary. Does this move make sense for us? —Max Liu

A: There are a lot of good reasons to roll money from a 401(k) plan into an IRA after retiring. In an IRA, you have greater control over your assets. You can own individual stocks, ETFs, or even real estate, and not be bound to the often-limited menu of investment options in your company’s plan. Since you are not working any longer, there is no concern over getting an employer match. If the fees seem high or you just don’t like maneuvering the plan’s website, a rollover may make sense.

But you are right to consider protection from creditors. In general, all assets inside a 401(k) plan are out of reach of creditors, both inside or outside of bankruptcy. That’s often true of 401(k) assets rolled into an IRA, as well—though you may be required to prove that those assets came from a 401(k). For that reason, never co-mingle rolled over assets with those from a self-funded IRA, says Howard Rosen, an asset protection attorney in Miami, Fla. He advises opening a new account for the roll over.

Federal law sets these protections. But through local bankruptcy code, 33 states have put their own spin on the rules—and California is one of those. “You need to understand that when you move assets from a 401(k) plan to an IRA, you are moving from full protection to limited protection,” says Jeffrey Verdon, an asset protection attorney in Newport Beach, Calif.

States like Texas and Florida make virtually no distinction between assets in a 401(k) and those rolled into an IRA, he says. Assets are fully protected from creditors in both types of retirement account. Further, in such states the distributions from such accounts are also protected.

But in California, creditors may come after any IRA assets not deemed necessary for living expenses. They may also come after any distributions you take from your IRA. You can protect up to $1.25 million through bankruptcy, a figure that resets every three years to account for inflation. But that is a total for all IRA assets, not each account, says Cyrus Amini, a financial adviser at Charlesworth and Rugg in Woodland Hills, Calif. And note, too, that a critical ruling last year determined that inherited IRAs are no longer protected.

To understand IRA protections in other states, you may need to speak with the office of the state securities commissioner or state attorney. Many of the state rules have been shaped through case law, and so you may want to consult a private attorney, says Amini. Another good starting point is the legal sites Nolo.com and protectyou.com.

MONEY Workplace

‘How Can I Avoid Telling a Job Interviewer My Age?’

birthday cake with ? candle in front of man in suit
Mojzes Igor—iStock

Q: My interviewer was trying to figure out my age. What should I have done?

This week during an interview at a well-known, privately held biopharma company, the hiring manager asked me, “When did you graduate from college?”

I thought this was odd and could indicate he was trying to find out my age (I’m in my 50s but look much younger). I danced around the question without actually answering it. But he would not let it go and kept asking it more directly (“How long and where did you work after college?” and “In what year did you graduate?”). My resume indicates only the last 10 years of experience which is directly related to this job.

What is the best way to avoid answering a potentially illegal question around age, race, sexual orientation, whatever? Should you call them on it or dance around it? Thirty minutes into the interview (shortly after asking me the loaded college questions), he abruptly ended the interview saying he didn’t want to waste my time. I’m not sorry because I would not have taken this job given the hiring manager’s interview tactics.

A: I would have asked this guy directly, “Why do you ask?” You want to say it in a friendly way, not adversarially, but being direct about it might have gotten him off that line of questioning (or not, depending on how shameless he was). In other cases where you’re being asked about things like age, marital status, parenthood, religion, or so forth, sometimes you can figure out what they’re really getting at and answer that instead of the direct question. (For instance, if you think they’re concerned that parenthood will get in the way of your job performance, you could say something like, “There’s nothing that would interfere with my ability to work the hours needed and get the job done.”)

By the way, despite widespread belief to the contrary, asking the question itself isn’t illegal — but basing a hiring decision on your answer would be, which is why smart employers don’t ask this kind of thing.

Q: I’m scared to resign because my boss will explode. Should I take the new job?

I have been at my current job for almost four years. When I started at this company, the boss I am working for owned the company and asked that I give her six months notice. I was shocked then, but I had no plans on leaving so I agreed. About a year ago the company changed ownership, but my boss still stayed and not much really changed except she was no longer signing my checks.

Now it is time for me to leave as I have no more growth potential (and haven’t had any for the past 3+ years) and I am ready for a change. PLUS she has been over managing me and demeaning me for years and I have finally hit my limit. Good news is that I have a pending new offer with growth potential, a raise, and better benefits but I am scared she will go ballistic on me. When I have seen previous employees leave and give their two weeks she called them “unprofessional” amongst other rude names and is horribly mean to them. To top all of this off, she will be on vacation in a few weeks and my two weeks notice may run into that vacation (she is gone for three weeks) as well. This complicates things even more as I manage her bills/home/life while she is out.

I am trying to do what is best for me without burning any bridges. Should I turn down this offer because I am scared? The new company may be flexible enough to give me an extra week but that wouldn’t be much help as she will already be on vacation.

A: Take the offer. Six months notice is absolutely unrealistic in most fields, and frankly anything more than two weeks is unrealistic with a boss who behaves like this one does. You know she’s going to react badly, so just brace yourself for it and let her explode. If she crosses any lines you’re not comfortable with, say this: “I very much want to work these final two weeks and leave things in good shape, but I’m not willing to be talked to this way. We either need to work together civilly, or today will need to be my last day.”

It’s really not your problem that she’s on vacation for part of your notice period. Give two weeks notice and don’t be talked into giving more.

Under no circumstances should you turn down this offer simply because you’re scared! Being scared that your boss will explode at a completely normal part of doing business is all the more reason to get the hell out of there.

These questions are adapted from ones that originally appeared on Ask a Manager. Some questions have been edited for length.

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MONEY Ask the Expert

The Best Way To Buy Stocks Warren Buffett Likes

Investing illustration
Robert A. Di Ieso, Jr.

Q: I’d like information on the “dividend aristocrats” that Warren Buffett has talked about. Should I buy them through a fund or a direct purchase plan? — Sheron Milliner

A: There’s no hard-and-fast rule about what stocks qualify as “dividend aristocrats,” but the moniker typically refers to companies that have consistently paid and raised their dividends — without fail — for at least several consecutive years.

The exact number of years is up for debate. Standard & Poor’s runs several equity indexes that track these types of companies. One benchmark that focuses on S&P 500 companies requires at least 25 consecutive years of dividend increases; a broader-based U.S. index looks for stocks that have boosted their payouts for 20 years or more; and a European version defines a dividend aristocrat as a stock that has boosted its payments for at least 10 straight years.

The dividend itself doesn’t have to be that large either — “it just has to be sustainable,” says Ron Weiner, CEO of investment advisory firm RDM Financial Group. “A company is showing its confidence in growth by increasing dividends as opposed to doing a one-time stock buyback or cash distribution.”

Companies that qualify as aristocrats tend to be value-oriented blue chips — think PepsiCo PEPSICO INC. PEP -0.17% , Johnson & Johnson JOHNSON & JOHNSON JNJ -0.5% , and Walmart WAL-MART STORES INC. WMT 0.43% — as opposed to high-flying newbies.

That said, a company’s place in the court isn’t guaranteed. Banks were for many years dividend aristocrats, but many cut their payouts in the aftermath of the financial crisis.

For that reason – and for the sake of diversification – Weiner’s advice to investors interested in this strategy is to look for an exchange-traded fund (ETF) or mutual fund that focuses on dozens or hundreds of companies with track records for paying and boosting their dividends.

The SPDR S&P Dividend ETF (SDY), for example, limits its universe to stocks that have increased their dividends for 20 consecutive years. Again, this isn’t to say it’s a forgone conclusion that these companies will continue to up their payouts. As Morningstar analyst Michael Rawson notes, because the fund weights its holdings by yield, it tends to favor lower-quality midcaps and value holdings.

Another ETF in this niche, the ProShares S&P 500 Dividend Aristocrats (NOBL), focuses on companies in the index with a 25-year record of dividend increase, but it gives equal weighting to all of its holdings.

It’s important to note that investors looking for income won’t necessarily find the highest yields among this group. Again, the key is consistency, says Weiner. “The point is to find good companies that have demonstrated that they can consistently grow their businesses over time.”

Although Weiner has used passive funds to tap into this group, he thinks active management may have an advantage here. “If something big happens, managers can react faster than an index,” says Weiner, whose firm has invested in the Goldman Sachs Rising Dividend Growth fund.

At the same time the fund sticks with companies that have raised their dividends an average of 10% a year over the last 10 years, its managers look for companies with the wherewithal to continue raising dividends in a meaningful way.

You could put together your own portfolio of dividend aristocrats by using one of the above portfolios as a starting point, but Weiner doesn’t recommend that approach. Even if you did assemble a diverse mix of dividend payers, keeping tabs on these companies is practically a full-time job.

“You can’t just buy and hold, and not pay attention,” says Weiner. “Aristocrats do get overthrown.”

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