MONEY family money

This Company Will Give You $500 If You Have a Baby Today. Wait, What?

141017_FF_BabyMoney
Mike Kemp—Getty Images

It's no joke. As part of its rebranding campaign, investment firm Voya will give money to the newest of new parents.

Lucky for you if you’re in labor right now.

A company called Voya Financial has announced that it will give every baby born today—Monday, Oct. 20, 2014—500 bucks.

The promotion, timed to coincide with National Save for Retirement Week, is part of a marketing campaign to alert the public that the business that once was the U.S. division of ING is now a separate public company with a new name.

Get out the castor oil and order in Indian if you’ve already hit 40 weeks, because the offer is only available to those who exit the womb before midnight tonight—though soon-to-be-sleep-deprived new parents have until December 19 to register a child.

Voya estimates that it may have to kick in as much as $5 million, since there are about 10,000 babies born every day in the U.S.

While the company has promised that families will not have to sit through a marketing pitch to get the money, and that the baby’s information would be kept private, this special delivery still comes with a catch.

The money is automatically invested into Voya’s Global Target Payment Fund, which according to Morningstar has above-average costs and below-average performance.

Regarding the fees, Voya’s Chief Marketing Officer Ann Glover says that the funds Morningstar uses as comparison are not apples to apples. In any case, Glover says families are free to sell out of the fund if they so choose. “Of course, we would hope people would hold on to the investment,” she adds.

But hey, money is money, so if you’re due, you may as well take what you’re due.

And for those mamas and papas whose progenies aren’t quite ready to make their debuts? While you won’t get money from Voya, you may have other opportunities to get big bucks for your little one.

Start by checking in with your employer to see whether the company helps with college savings. A growing number do. Unum, for example, offers its workers with newborns $500 towards a college savings account.(Our Money 101 can help you find the best 529 college savings plan.)

Also, in several communities around the country, charitable or government programs seed savings accounts for kids. For example, residents of northern St. Louis County in Missouri can get $500 through the 24:1 Promise Accounts. Babies born in Connecticut get $100, plus $150 in matching funds by age four, thanks to the CHET Baby Scholars program.

“This is gaining significant momentum nationwide,” says Colleen Quint, who heads one of the nation’s most generous free savings program, the Harold Alfond College Challenge. Started by the founder of Dexter Shoes, the charity gives every resident newborn in Maine a $500 college savings account.

In fact, Mainers can get the most free money for their children according to a survey of such programs by the Corporate for Enterprise Development, which has gathered details on at least 29 free childrens’ savings programs.

Besides the $500 college savings account, a state agency will match 50¢ for every $1 parents contribute each year up to $100 a year and $1,000 over a child’s lifetime. So Mainers can, in theory at least, get up to $1,500 in free college savings money on top of any additional freebies they can get from companies.

That should be more than enough to buy a chemistry textbook in 2032.

MONEY Careers

The Best Way to “Come Out” to Coworkers and Bosses

Desk with photo of two brides
MONEY (photo illustration)—iStock (main)—Getty Images (inset)

Tired of ducking out of relationship conversations at the water cooler and using gender-neutral pronouns? These strategies can help you open up with your colleagues.

On Saturday, in celebration of the 26th annual National Coming Out Day, many gay, lesbian, bisexual, and transgender individuals took the courageous step of expressing their sexual identity to parents, relatives, and friends.

Few of those who spoke out, however, are likely to share their news with co-workers and employers now that they’re back at their jobs.

Despite rising public support for LGBT rights and the increase in state laws recognizing those rights, a majority (53%) of LGBT workers in the U.S. hide this part of their identify at work, according to a study released this year by the Human Rights Campaign.

According to the survey, the reasons for not being open at work range from feelings that one’s sexual orientation or gender identity is “nobody’s business,” to fear of being stereotyped, to concern that bias could have a negative effect on one’s career and professional relationships. What many don’t realize, however, is that remaining in the closet can itself have negative effects: Many LGBT workers report feeling exhausted and distracted at work from all the time and energy they spend hiding their identities, according to HRC.

Coming out to professional relations can seem just as challenging—if not more—as coming out to personal ones. “But often fears are overblown in our minds,” says Sarah Holland, an executive coach who formerly headed the Visibility Project, a national organization that helped corporations address issues of sexual orientation in the workplace. “The world is more receptive to LGBT individuals than it’s ever been before. More often then not your colleagues have already made assumptions about your sexual orientation, especially if you never say anything about your personal life.”

There’s no need to share your orientation if you don’t care to, experts say. But if you decide that it’s finally time to let your guard down, take these steps to make it easier:

Assess the Risks

Before doing anything, you want to make sure that you won’t put your career or personal security in any kind of jeopardy by saying something.

Start by checking whether your state has a non-discrimination law that would protect you from being fired, harassed, or discriminated against. Currently 21 states have such laws in place regarding sexual orientation, and 17 of those for gender identity as well. (No workplace protections exist in federal law.)

While it’s a reassuring backstop if your state is among those that offer protections, it’s arguably more important to assess your company and department culture to get a sense of how your news will be received, suggests Deena Fidas, director of workplace equality for the Human Rights Campaign.

Does your employer have a written non-discrimination policy that covers sexual orientation and/or gender identity? The vast majority (91%) of Fortune 500 companies have workplace protections in place on the basis of sexual orientation and 61% on gender identity. Does your company offer domestic partner benefits? Is there a support or affinity group for LBGT individuals, or is anyone in your department openly gay? (If so, you might want to talk to people to learn about their experiences coming out and for their insights.) Is your company ranked highly on the Human Rights Campaign’s Corporate Equality Index?

On the other hand, have you heard anyone at work make derogatory comments about LGBT people?

Should you get the sense that it wouldn’t be comfortable to come out, you might want to rethink your corporate affiliation, says Holland. “Consider why you want to be at that company. Do you really want to spend your work life being closeted for fear?”

Start with Your Closest Colleagues

Once you determine that your workplace is LGBT friendly, begin by sharing more details of your personal life with a trusted coworker whom you know is LGBT-supportive, recommends Fidas.

Having an ally will make you feel more comfortable opening up to the rest of the workforce, and can help you deftly handle any conversations that get awkward or too personal.

For the other folks in your social circle, “use the Monday morning coffee talk as a chance to be more forthcoming,” suggests Holland.

Chances are, you’ve been ducking out every time the social chatter turns to relationships or dating—and 80% of straight workers say that these conversations come up weekly or even daily, according to the HRC survey. But now use them to your advantage: “When asked how you spent your weekend, don’t change the gender of your partner,” says Holland. “Say if you went to a function for gay rights.”

By speaking about your LGBT identity casually, you can help coworkers to follow your lead and treat it the same way.

Let Everybody Else Figure it Out

While coming out to family and friends often happens with a discrete announcement, “in the reality of the workplace, coming out is more of a daily process, not an announcing that one is gay,” says Fidas.

In other words, you need not go around to everyone from the IT guy to the mail clerk to formally and awkwardly inform them about your sexual orientation. There are many subtle, discreet ways you can clue in coworkers with whom you’re less likely to talk about these topics.

For example, putting photos of your partner on your desk or having your loved one pick you up at the office allows coworkers to make the discovery themselves without you hiding any aspect of your identity.

Fidas also recommends using an opportunity to correct a coworker’s mistaken assumption as a way to make your sexual orientation or gender identity clear: “If you’re staring a new job, and a coworker asks if you moved from Boston with your husband, you can say you moved with your wife, rather than saying your spouse moved with you.”

Remember most of all that “you do not need your coworkers’ approval,” says Judith Martin, author of Miss Manners Minds Your Business. “You only need them to be respectful of you, which your workplace probably already obligates them to do.”

MONEY retirement planning

8 Things You Must Do Before You Retire

sébastien thibault

Getting ready to retire? The moves you make in the months before you call it quits can smooth the way to a secure future.

After working diligently for more than 30 years—so you could set yourself up financially for your golden years—the glow of retirement is finally on the horizon. Alas, it’s not time to relax just yet.

Each day more than 10,000 baby boomers enter retirement. Yet only around one-quarter of workers 55 and older say they’re doing a good job preparing for the next phase, according to the Employee Benefit Research Institute. The last 12 months before you call it a career is especially critical to putting your retirement on a prosperous path. It’s time to get your portfolio, health care, and other finances in order so you can enjoy your new life.

THE TURNING-POINT CHECKLIST

12 Months Out:

Dial back on stocks now. You still need the growth that equities provide, but even a 15% market slide in the year before you retire can erase four years’ worth of income. Cap stock exposure to around 50% in your sixties, advises Rande Spiegelman, vice president of financial planning at Schwab Center for Financial Research.

Raise cash. Your paychecks are about to stop. So as you downshift from stocks, move that money into a savings or money market account to fund at least one year of expenses, says Judith Ward, T. Rowe Price senior financial planner.

Set a realistic retirement budget. Use the worksheet on Fidelity’s free retirement-income planner to list all of your fixed and discretionary expenses. Then use T. Rowe Price’s free retirement-income calculator to see how safe that level of spending is likely to be, based on the size of your nest egg and age.

6 Months Out:

Play out Social Security scenarios. You can claim Social Security at 62, but if you can hold off until 70 your checks will be 76% bigger. Tool around FinancialEngines.com’s free Social Security Income Planner to find the best strategy for you.

Figure out how you’ll pay for health care. Check if your company offers retirees medical, long-term care, and other insurance coverage. If you won’t get health insurance and aren’t yet 65 (when you qualify for Medicare), then compare plans offered via the Affordable Care Act at eHealthInsurance.com. Or use COBRA, where you can stay on your employer plan up to 18 months after leaving.

3 MONTHS OUT:

Begin the rollover process. In a small 401(k) plan, average fund expenses can run north of 0.6% of assets. You can cut those fees at least in half by shifting into index funds at a low-cost IRA provider. See if your plan provides free access to investment advisers to help you decide.

Sign up for Medicare. Nearing 65? You can enroll for Medicare up to three months before turning that age. Also, figure in supplemental plans to cover expenses that Medicare does not, such as dental care and prescription drugs.

Get a running start. Put your post-career itinerary into action. Research volunteer groups that you want to join, reach out to contacts if you plan to keep a hand in work, start a new exercise routine, or begin planning that big trip.

MONEY job hunting

How to Ace Any Interview and Land the Job of Your Dreams

Handshake illustration
The in-person, one-on-one job interview is getting a new look. Anna Parini

Forget the traditional sit-down with a rep from HR. Nowadays companies are employing decidedly offbeat hiring techniques. To land the spot you want, be prepared for whatever tests come your way.

Planning your next big career move? Get ­going. Job openings climbed to 4.7 million in June, the highest level since 2001, reports the Bureau of Labor Statistics. And in a recent survey by Challenger Gray ­& Christmas, 77% of hiring managers re­ported trouble filling slots because of a talent shortage.

To succeed in this sunnier market, though, you need a firm grasp on today’s hiring process, one that may be far different from what you faced the last time you hit the circuit. For starters, businesses are going slow, spending an average of 23 days to fill a slot in 2013, vs. 12 days in 2010, according to employer review website Glassdoor. And many are replacing antiquated hiring methods with more offbeat ways to vet job seekers.

“Companies are finding traditional job interviews aren’t identifying the high-quality candidates they need,” says Parker McKenna of the Society for Human Resource Management. Numerous academic studies have unearthed flaws in the process. A 2013 one co-written by psychologist Jason Dana at the Yale School of Management found that many hiring managers are mistakenly overconfident in their ability to assess how well a candidate will perform through a one-on-one interview. To get an edge on your competition, you should prepare for these four types of tests.

The Video Chat

What to expect: Last year nearly one out of five job seekers sat through a video interview, more than double the number the year before, according to a survey by workforce consultants Right Management. Firms want to see your communication skills, says ­McKenna. Plus, recruiters can cast a wider net for candidates without the cost of flying applicants into the office, notes Paul Bailo, author of The Essential Digital Interview Handbook.

Since American Wedding Group, a Huntingdon Valley, Pa.–based provider of photographers, videographers, and disc jockeys, began video interviewing in May, the company has conducted more than 300 screenings. The firm used to interview candidates from across the country by phone. This new approach, says head of human resources Scott Mitchell, works better for a business that places a high value on professional appearance. “We want to be confident the candidate is someone we feel comfortable putting in front of our clients,” he says.

How to be ready: Most video interviews are via Skype, so make sure you have a professional-sounding username and profile photo. Then nail down the mechanics. “Don’t let technology get in the way of getting hired,” says Bailo. That means investing in quality gear instead of relying on your computer’s built-in microphone and fisheye camera. “If you want to get a job, you have to buy a suit,” he says. “If you want to nail a digital interview, you have to buy the right equipment.”

His picks: the Logitech HD Pro Webcam C920 ($100) and Blue Microphones Snowball sound kit ($90). To cut the risk of technical hiccups and a bad Internet connection, do a practice run with a friend an hour in advance.

As with an in-person interview, looks matter. So dress appropriately, head to toe (be ready to stand to adjust the camera). Sit opposite a window for the best lighting, and pick a backdrop that’s clutter-free; off-white is ideal.

During the interview, keep looking at the camera. “If your eyes are shifting around, it distracts from the content of your interview,” says Bailo, who recommends taping a script to the wall behind the camera so that you can hit on key points without having to look down or shuffle through notes.

The Group Session

What to expect: While some employers rely on group interviews to weed through a large pile of applicants, companies more commonly use them to survey a refined pool of potential hires for certain qualities.

You’re likely to be one of three to five candidates, says Dan Finnigan, CEO of the social recruiting platform Jobvite. Typically you’ll be tasked with a group exercise. At Taste of D.C., a culinary event-planning business, groups must work together to develop a marketing campaign, say, or make a presentation. Even beforehand, the company observes how candidates waiting outside the interview room interact in a casual setting, says CEO Steuart Martens.

Adrian Granzella Larssen, editor-in-chief of career advice website The Muse, points out that interviewers are looking for a very specific set of interpersonal skills, such as leadership, communication, and collaboration.

That’s what the Boston-based international tour operator Grand Circle is after when it gives groups a task to complete, such as building a vehicle to transport an egg. “We analyze how candidates react,” says senior vice president of human resources Nancy Lightbody. “We’re looking for natural leaders to emerge.”

How to be ready: No matter how tempting it may be to grab the spotlight, don’t. “Dominate the conversation, and you’ll be perceived as aggressive,” says Priscilla Claman, president of Boston coaching firm Career Strategies. Sit back, though, and you risk being overlooked.

Give others space to offer ideas and then build on what they say. (“Josie brings up a great point …”). “Having the ability to politely piggyback demonstrates you can collaborate and work well with others while taking a leadership role,” says Finnigan. (Letting someone else speak first gives you more time to craft your idea too.)

Being in the same room as your competition, though nerve-racking, may give you a feel for the atmos­phere at your future workplace. You’re getting a glimpse into the types of people the company likes. If the competition is cutthroat, employees may be as well.

The Panel Approach

What to expect: A third of employers put prospects in front of a group, Glassdoor reports. You’ll probably meet with three to five people, such as an HR rep, your prospective super­visor, a senior peer, and heads of departments you’d interact with daily. For employers a panel interview has several advantages. “It eliminates different people hearing different things in one-on-one interviews,” says Peter Cappelli, director at Wharton’s Center for Human Resources.

The insurer Kaiser Permanente asks finalists for midlevel management positions to present to a group. “It creates efficiency for both the candidate and the company,” says Jason Phillips, vice president of national recruitment and HR operations. “Many senior job seekers have a tight calendar.”

Another upside for you is the insight you can gain into the company culture. Pay attention to how panelists interact with one another; in a healthy environment co-workers are collaborative but also welcome and respect other points of view, says Finnigan.

How to be ready: To make it past a board, you’ll need everyone’s buy-in, says Washington, D.C., career counselor Karen Chopra. Contact your point person ahead of time to learn whom you’re meeting and roughly how long the interview will last (some run two to three hours). To give yourself a preview of the folks you’re facing, look up everyone’s profile on LinkedIn.

Introduce yourself to all the panelists and jot down the seating order; you can glance at the chart throughout the session so you can address each person by name. (Save it for writing your thank-you notes.)

Eye contact conveys confidence, says Chopra, so look directly at the person who poses the question, pass your eyes around the room as you answer, and circle back to the questioner as you’re wrapping up. Bring any mum panelists into the conversation, especially if there’s a chance silence means a closed mind. Posing a question about their divisions or clients also shows you’ve done your homework.

The High-Stakes Game

What to expect: Borrow your kid’s Xbox controller—you might need it for a job interview one day. Employers in a number of fields, including energy, consumer goods, and financial services, are starting to take a look at gaming technology to assess job candidates. Through custom-made videogames, companies can measure skills and personality traits that may be tough to pick up in person. “This is in the testing phase,” says veteran recruiter Mark Howorth. “But I do feel like it is about to take off.”

Take Knack’s Wasabi Waiter, a 10-minute game that has job seekers act as a sushi server at a virtual restaurant. Not only are your customer service skills tested, says Guy Halfteck, founder and CEO at the game developer, but “the game evaluates everything from your problem solving to critical thinking, logical reasoning, empathy, conscientiousness, and emotional intelligence.”

How to be ready: Gaming is in its infancy as a hiring tool, and how well the approach identifies ideal workers remains an open question. Nonetheless, get used to the technology. You can play Wasabi Waiter on Knack’s free mobile app, “What’s Your Knack?,” but don’t overthink your strategy: Your instincts are what interest employers, says Halfteck. When you’re finished, though, get back to working on your in-person interview skills. Odds are the last leg of the hiring process will be a face-to-face one.

MONEY College

Choosing a College Major by Age 16 Pays Off. Here’s Why

Forget the old thinking that kids could wait until college to decide a major. Today, they really ought to be making this decision before their junior year of high school.

I know what you’re thinking: How can I suggest such a thing? Why would we put that kind of pressure on high school students? Shouldn’t they be allowed to explore their interests in college first before having to declare a major?

But what’s the alternative?

By the time most students lock down their major, they’re halfway through their college career or nearly out the door. By some estimates, 80% will change their course of study at least once before graduation. And, we’re telling them not to worry about it. Just take your time, explore your interests and get your diploma.

But with students’ future financial health on the line, discussions around major choice and career path are just happening too late.

Delaying these important decisions could leave a student needing more than four years to complete the class requirements necessary to get a degree, and additional semesters or years add to the already burdensome cost of an education. For bachelor’s degree grads in the class of 2013, average education debt was almost $38,000, according to a report by Edvisors.com.

Additionally, what if a student ultimately ends up choosing a major that leads them into a low-paying field after they’ve already decided on a high-cost school and taken on substantial amounts of student loan debt?

Income-driven repayment plans from the federal government may offer some help for those that choose less lucrative career paths, but these plans do extend the repayment period from the typical 10 years to 20 to 25 years. This could mean that in the years when your children should be thinking about saving for retirement or for their own kids’ education, they’ll still be paying off their student loans. And, these plans won’t apply to any private loans used to fund college.

Major choice, and ultimately career path, should help guide your child’s choices around where to attend college and how much education debt they can afford in the long run. These choices have far-reaching implications. Here at PayScale, we just released data on salary potential for 121 associate degree majors and 207 bachelor degree majors as part of our annual College Salary Report. Understanding earning potential should be a pre-requisite to signing any student loan documents.

Big life decisions are scary, but mountains of debt (and the prospect of your college grad moving into your basement) are much scarier. Twenty-eight percent of Millennials have had to move home with their parents after college due to financial hardship. You’re not doing your son or daughter any favors by advising him or her to delay the decision on a major.

It’s not all on you as the parent either. High school curriculum should be helping students understand real-world applications for what they’re learning and guiding them into career paths for which they’re well-suited. “Career day” doesn’t cut it anymore.

And, I bet if you asked the average 10th grader which careers will have to use algebra on a regular basis, they couldn’t tell you. We need to be showing them why the subjects they’re studying matter and how they apply to careers they may be interested in pursuing. We need to expose them to careers they might not even realize exist.

Even if your kid doesn’t definitively choose a major by the time they graduate high school, starting these conversations early can only benefit them.

Lydia Frank is editorial director at PayScale.com, a site that provides on-demand compensation data and software to employees and employers.

MONEY First-Time Dad

Why Millennials Should Have Kids—and Soon

Luke Tepper
Yes, he costs a ton, but he's worth it.

There are plenty of financial and lifestyle reasons to not have a child, but there are also costs to delaying or forgoing, notes MONEY reporter and first-time dad Taylor Tepper.

I finally realized that I’m no longer in charge of my own life a few of weeks ago.

It was a Tuesday at 9:45 p.m. I had arrived home from work at 7:30, just as my wife was putting our son to sleep.

I cooked dinner for the two of us. We ate together on our small dining room table and then spent the rest of the night preparing for tomorrow. Mrs. Tepper collected Luke’s toys and straightened up around the house while I programmed the coffee maker and started to load the dishwasher… only to discover that we were out of soap. Sigh.

I jabbed my feet into my slippers. The dishes needed to be washed, so I found myself headed outside in my pajamas.

As I plodded to my neighborhood grocery store, it dawned on me that I wasn’t running this chore because I wanted to, but because our delicate family ecosystem demanded that the dishes get washed at night. Otherwise, the milk bottles and containers wouldn’t be ready by the morning, meaning my wife wouldn’t be able to pump at work and my son wouldn’t be able to eat.

This two-hour spell of cleaning, organizing, and readying felt like the actualization of a Millennial nightmare.

I had handed over the keys to my liberty to an infant. Before Luke was born, I could sleep all morning, grab a pint whenever I wanted or fly around the country to visit friends. I could quit my job, write a novel, start an artisanal pickled beet company or simply toss a Frisbee in the park all day.

Those days are over. Full stop. But the real question is: Would I ever want them back?

The opportunity cost of having kids

Most people of my generation aren’t like me. In fact, just over one-in-four Millennials tied the knot between the ages of 18 to 32, according to Pew Research Center. That’s 10 percentage points lower than Gen Xers at a similar point in their lives in 1997 and more than 20 points below Baby Boomers in 1980.

Further, research by Wharton School of University of Pennsylvania’s Stewart Friedman seems to indicate that the majority of my peers aren’t interested in kids. Friedman’s study looked at the views Generation Xers had toward bearing children as they graduated college in 1992 and Millennials in 2012. Almost eight in 10 Gen Xers said they planned to reproduce, Friedman found, compared to only 42% of Millennials.

Parenthood comes with a price that Millennials may not be eager to pay. According to the most recent numbers from the U.S. Department of Agriculture, it will cost middle-income moms and dads an average $245,340 to raise one child up to age 18—a stunningly large figure for those who are already burdened by student debt and who graduated into a nasty Recession.

It doesn’t help that America is one of two countries without any kind of paid maternity leave and childcare is very expensive.

Another factor that might dissuade Y women: Mothers who alter their career paths to care for their children can lose out on a lot of potential income. Economist Bryan Caplan pegs the opportunity cost as high as $1 million.

And, of course, there are the non-financial opportunity costs of bearing children: less freedom, less time, and less sanity.

The payoff of having kids early

I understand all of this. I’m living it. My wife and I spend the vast amount of our weekends doing the laundry, sweeping, mopping, shopping and organizing. We schlep and push and haul all day long. Not to mention the $1,600 a month we’re giving to someone else to care for our child. We could have put that money toward a dream vacation, a starter home… or alcohol.

But conceiving a family in your 20s comes with certain advantages. For instance when Luke leaves the nest, my wife and I will be in our mid-40’s and just entering our peak earning years. That means while he’s off at college, we can power save to boost our retirement portfolio.

Plus, you’re more likely to have flexibility at work in your 20s, since you probably have a more junior position with less responsibility. The higher up you get on the food chain, the tougher it is to leave early to go to a parent-teacher conference or soccer game (or so my older colleagues tell me).

There’s also the fact that your ability to actually conceive children decreases as you age, per the Mayo Clinic, while the risks of complication—from C-sections to pregnancy loss—increase in your mid-to-late 30’s. And complications typically mean more money for health expenses.

Look, there are many reasons not to have a child. You may simply not want one—and that’s fine.

But to dismiss the idea of raising a child, or raising him now as opposed to ten years in the future, because you haven’t yet traveled the world or written that magnum opus slightly misses the point of it all. When you raise a child, especially with someone you’ve committed your life to, your self-interest becomes tied up in theirs.

To put it another way, what a lot of people don’t think about is that there’s an opportunity cost to deciding not to have a child: You don’t get to experience the sublime joy of yielding your wants and desires for the happiness of the people you love.

Taylor Tepper is a reporter at Money. His column on being a new dad, a millennial, and (pretty) broke appears weekly. More First-Time Dad:

MONEY home buying

When Moving In With Mom and Dad Is a Wise Choice

Having enough money to buy your own place is hard. Here are four strategies, including living with family or friends for a period, that will help make it doable.

Despite the real estate boom and bust and the many Americans who lost their houses or saw the value plummet, most non-homeowners still hope to buy a place one day. Of course, many reasons exist as to why they haven’t yet, including bad credit or too much debt, as well as the doozy: a lack of upfront cash. According to a recent Trulia Trends survey, 41% of millennials surveyed said that saving for a down payment is their biggest hurdle to home ownership. Being able to swing the monthly mortgage nugget simply isn’t enough.

Here are four ways that home buyers (millennials or any generation) can increase the amount they’ve got stashed for the down payment, and build their buying power.

1. Find New Ways To Save

Move back in with Mom and Dad: You might be cringing right now, but don’t worry — it’s not forever, and chances are your folks will throw you out before you are ready to move out anyway. Consolidating housing and moving back in with parents for a short period of time is a huge way to save money.

Cut back on significant spending: Sure, you can cut back on the daily latte and lose a few cable channels, but that is not going to get you enough saved before middle age. You need to cut back on the significant spending areas and big ticket items, like a fancy car (with hefty monthly payments) and yearly vacations. You’ll likely be surprised at how easily you can adapt to spending less, when you know the money saved will go toward an important goal.

Pay yourself first: Set aside money to be saved automatically every time you receive a paycheck — no matter what. Your bank should be able to help you with this by automatically depositing a specific sum into your savings account when your paycheck clears. This way you’ll know when you’ve hit your spending limit for the month.

2. Seek Out Additional Income Sources.

A little help from Mom and Dad: A great and often overlooked source is … the folks. If they are in a position to help you, each parent can “gift” you money every year, tax-free. Currently the allowed amount is $14,000 per year, per parent. If you are married, you can double that to more than $50,000 a year. If you are smart and plan ahead, two years’ worth totals six figures. A very nice start! In fact, according to Trulia’s survey, 50% of all millennials plan to do just that!

Get a roommate: This one is a no-brainer — if you have an extra room, fill it. Let your apartment or your current home work for you. Just be sure you actually sock away that extra income, so you can watch it grow.

Generate a second income: It’s amazing how a few extra dollars can add up over time. A friend of mine taught high school for years and owned an amazing home. When I asked him how he was able to purchase and afford an expensive home in a wonderful neighborhood, he said he had taken on a part-time job as a copywriter for a local paper. He allocated all of that extra income to the purchase of his house. Over time, that money grew and grew.

3. Get Your Credit and Debt in Check

Clean up your credit: A better credit score equals a better mortgage interest rate, which ultimately equals better buying power. Take the necessary steps to clean up your credit. This usually takes time, so plan way ahead—and at least a year in advance. For more on how to improve your credit, click here.

Less debt gives you more buying power: The lower your debt levels are, the stronger your debt-to-income income ratio, which is a key factor when a bank determines how much house you can afford. To keep that ratio in check, and to look favorable to lenders, begin paying down high-interest, revolving balances on credit cards. Also, avoid any big purchases before a potential home purchase. Any big ticket buys (like a new car) can alter your financial picture and prompt a lender to give your finances a more in-depth look.

Student loans do count: For most millennials, student loans can be very high in those early post-college years. Unfortunately, you need to remember that student loans count as debt when the bank is determining your buying power.

4. Downsize Your Dream Home

The starter home: So many people say, “How could I ever buy a decent house in this town?” Well, start thinking smaller. Instead of a $300,000 house, you need to find the one that fits your budget … today. There will be plenty of time to upgrade that starter home into a bigger dream home later. This is where the term “starter home” came from! As you pay down the loan and hopefully build some equity, it’s possible that you may be able to upgrade in five or more years.

Find the same house in a transitional neighborhood: Buying your first home in a transitional area allows you to get into the market relatively cheaply—if you don’t yet have kids, before you have to worry about the local schools—and increase your buying power. It may not be the most sought-after or picturesque community at the moment, but as it improves, your home value will improve with it.

Michael Corbett is Trulia‘s real estate and lifestyle expert. He hosts NBC’s EXTRA’s “Mansions and Millionaires” and has written three books on real estate, including Before You Buy!

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12 Steps To Fight a Low Appraisal
Breaking Down Debt: How 4 Different Loans Affect Your Mortgage Worthiness8 Quick and Clever Clutter-Clearing Hacks

 

MONEY family money

Money Fears Keep Women in Abusive Relationships. Here’s How to Change That.

140909_FF_WhyIStayed
Ray Rice with his wife, Janay Palmer. Vernon Ogrodnek—AP

Domestic abuse victims have opened their hearts to share #WhyIStayed stories on Twitter—and many cited financial dependence among their reasons. These 8 key steps can help break the cycle.

“Why did she stay?”

That was the question many people asked online Monday after they saw the graphic video of Baltimore Ravens running back Ray Rice punching his then-fiancée, Janay Palmer, in an elevator. The media event inspired Palmer’s fellow victims of domestic abuse to come out—through the Twitter hashtag #WhyIStayed—to explain why leaving isn’t that easy.

One of the major themes running through those tweets is financial dependence.

Many victims who tweeted their stories said they feared they’d be homeless or living in poverty if they left. Some said they’d be without any income or health insurance. Others expressed that their partners exerted economic control to prevent them from leaving: keeping them from getting jobs, running up debt on their credit cards, restricting access to money.

Even when victims of domestic abuse do leave their partners, ruined credit scores, erratic employment histories, legal issues, or debt threaten their future employment and financial security—which then leads many of them right back to their abusers, experts say.

“Economic self-sufficiency is frequently the difference between violence and safety for many victims,” states the National Coalition Against Domestic Violence.

One in four women experience partner violence, according to the coalition. If you are one of those victims, or know someone who is, make sure financial planning is part of the exit strategy. The advice outlined below can help people get ready financially to go—so that more can share their stories at #WhyILeft.

Understand where you stand

If you don’t handle the family’s money, you may not be aware of the state of your entire financial situation. Try to get a sense of what you and your spouse own and owe, and in whose name those assets and debts reside.

Unfortunately, this info may not be easy to get. “Some victims are scared to even inquire about these accounts for fear of violence or verbal abuse,” says Brent Neiser, senior director for the National Endowment of Financial Education, which has created a free book to help domestic abuse victims called Hope & Power for Your Personal Finances: A Rebuilding Guide Following Domestic Violence.

Also, by trying to acquire account information, you may accidentally flag your intentions to your spouse. So you’ll need to be careful. “Find a safe place where you can write down information as you come across it, like noting which bank the statements are coming from and any bank account numbers you find,” says Neiser. “You may have to go into a branch and inquire in person about accounts.”

If you’re looking online for information, be sure to use a private browser window so that your searches are not saved in the cache for your partner to see.

Gather key documents

Try to make copies of any important financial or personal documents—bank statements, birth certificates, marriage certificates, ownership documents for shared assets. Store these with friends or family or in a safe place at home.

When you do leave, take these copies and, if possible, all original documents that list your Social Security number and passwords.

You’ll want to have all your personal data with you to help re-establish yourself and keep your abuser from being able to commit ID theft. If your partner knows your information, or if you weren’t able to take all your records with you and fear your partner may seek financial revenge, consider changing your Social Security number, says Neiser.

Check your credit

Request a free copy of your credit report from one of the three major credit bureaus via annualcreditreport.com.

Look at the document to make sure that your partner did not open any lines of credit in your name that you don’t know about. If there is any fraudulent or incorrect information in the report, dispute the error with the credit bureaus.

Change your passwords

Pick new personal identification numbers (PINs) and passwords on all accounts just before you leave—maybe as soon as a few hours before if you’re afraid of your spouse finding out—or as soon as possible afterward. Don’t forget about your email and benefit plans, says Neiser.

Avoid using personal details that your partner could guess in your password, so as to keep the person from running up bills in your name or draining your accounts.

Establish solo accounts

If you don’t already have one, set up a personal checking and savings account for yourself as soon as you can before you go. Make sure the account is listed only in your name and that statements from the account are sent to a secure mailing address or email address so that your abuser cannot access the account or have knowledge of your finances.

Squirrel away whatever money you can without your spouse noticing—maybe a part of whatever allowance you receive or, if you work, as much of your paycheck as you think you can get away with. You want to have a cushion when you leave.

Get your direct deposit set up so that the first paycheck after your planned departure date will go to your personal account.

Protect yourself from debt

Try to pay off any balances on joint credit cards so that it will be easier to close the account and prevent an abuser from racking up debt.

If you’re unable to pay off what’s owed, call your credit issuer and request that your name be removed from the account. This won’t protect you from any existing debt, but it may help protect you from having to pay for anything charged after you leave the abuser.

Take your share

Assuming you have access to joint bank accounts, you will want to make a withdrawal of 50% of the balances and put that in your personal account, says divorce attorney Emily Doskow.

If you live in one of the nine “community property” states—in which whatever is earned or acquired during marriage is split 50/50 in a divorce—you are legally entitled to half. The rest of the states attempt to split property fairly based on what each person brings in and other factors, meaning it can be 50/50 or not. But even if the court finds you aren’t entitled to half, the worst consequence is that you have to pay some of the money back.

To protect yourself, take screenshot of account at the date at which you do it showing the amount before and after.

Making this withdrawal is the last thing you should do before you leave, as this will definitely alert a spouse to your plans to go. But you do want to make sure you get this money before your partner can drain the account.

Ask for help

Need help finding a place to live or a job, recovering your money, or handling the trauma of abuse? The National Coalition Against Domestic Violence has a coalition in each state that can help you find resources in your area.

Also, as you begin rebuilding, you might consider taking Allstate’s free financial empowerment and career empowerment courses, which have helped more than 400,000 domestic abuse victims become financially independent.

Above all, remember that you are not alone. “Talk with people who are more advanced in their recovery and getting re-established,” says Neiser. “Ask them to share the smart, insightful techniques they’ve used. Many people working at these shelters and advocacy groups are victims themselves.”

A previous version of this article referred to Janay Palmer as the wife of Ray Rice at the time of the incident. The couple later married but at the time she was his fiancée.

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MONEY Kids and Money

The Surprising Thing Gen Z Wants to Do With Its Money

Teen in front of home
Getty Images

More than half of teens would give up social media for a year and do double the homework if it guaranteed they’d be able to buy a house when they're older.

During the Great Recession, home ownership took a beating as the ideal for the American dream. The median home nationally lost a quarter of its value, prompting adults of all ages to adopt other elusive goals—like retiring on time for boomers or working on their own terms for millennials.

Just 65% of Americans own their home, down from 69% pre-bust. And four out of five Americans are rethinking the reasons they’d want to buy a house in the first place. But Generation Z—also known as post-millennials, born after the 1990s Internet bubble— seems to prize home ownership like no generation since their great-grandparents.

An astounding 97% of post-millennials believe they will one day own a home; 82% say it is the most important part of the American dream, according to a survey of teens age 13 to 17 by Better Homes and Gardens Real Estate. More than half would give up social media for a year and do double the homework if it guaranteed they’d be able to buy a house.

This yearning stands in starkest contrast to the aspirations of millennials, older cousins who pretty much created the sharing economy and in large numbers prefer to rent. The housing bust and foreclosure epidemic scarred millennials, probably for life, as some watched parents and neighbors lose everything. In a key part of this generation—heads of households age 25 to 34—renters increased by more than 1 million in the years following the crisis, while the number who own a home fell by 1.4 million.

Post-millennials saw the carnage, too, though at a tender age that left them more confused than traumatized. Where millennials hardened and vowed never to repeat the errors of their parents, post-millennials sought the comfort of family and togetherness, says Sherry Chris, CEO of Better Homes and Gardens. “Many of these Gen Z teens were 7 to 11 years old when the recession hit,” Chris said. “At that age, children equate home with stability.”

The innate quest for stability leads them to prize a family home above things like going to college, getting married, having children, or owning a business, according to the survey. And the dream appears firmly grounded in reality. Chris observed that today’s teens have more information than any previous generation at their age and show early signs of financial awareness. Asked for an estimate of what they might spend on a house, the 97% who aspire to be owners gave an average response of $274,323—strikingly close to the median home value of $273,500.

Half say they know more about money than their parents did at their age. Two-thirds attribute their knowledge of money matters to discussions in the home, and two in five credit discussions in school. Three in five teens have already begun saving, the survey found. Post-millennials, on average, aim to own a home by age 28—three years earlier than the median age of first-time homebuyers reported by the National Association of Realtors.

These are encouraging findings. A home remains most Americans’ single largest asset, and while the housing bust will have lingering effects, home prices nationally tend to rise every year—and have been trending up again the past few years. Not all of the news is good: Only 17% of post-millennials believe stocks are the best long-term investment; half prefer a simple savings account, TD Ameritrade found in a survey that defines the generation as slightly older (up to age 24).

But the TD survey also found that post-millennials have half the post-college credit card debt of millennials. And the Better Homes survey suggests that our youngest generation is at last learning more about money at an early age, which is the goal of a broad public-private financial education movement. A generation of financially adept youth who begin to save and gather assets that will grow for four or five decades is the surest way to avoid another meltdown and solve the retirement savings crisis.

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MONEY Kids and Money

The Cost of Raising a Second Baby (Who’s Not a Prince)

Britain's Prince William and Kate Duchess of Cambridge and the Prince
John Stillwell—AP

No plush royal cushion to fall back on? Here's what costs the rest should expect when expecting kid number two.

The British monarchy announced via Twitter today that that the Duke and Duchess of Cambridge are expecting their second baby, a little more than a year after Prince George was born.

It’s not unusual, once you’ve gotten the hang of one, to start thinking about number two. After all, the typical American woman has 2.01 children, according to the U.S. government.

But with their posh life at Kensington Palace, Will and Kate will have have had a bit of an easier time making the decision to go for a second than the rest of us, who will face a fairly consequential question: How can I possibly afford this?

The Department of Agriculture estimates the annual cost of a single child under age two at $16,180 for a two-parent, middle-income household. Sharing things like toys and perhaps a bedroom means you get something of a discount on the second one, so parents’ outlays go up about 80% rather than doubling. Not that an extra $12,940 is pocket change for most of us, especially when added up over a lifetime.

A couple with a combined income of more than $107,000 would spend an average of $510,000 to raise a child to his 18th birthday. For a pair, the number is just short of seven figures, at $826,000. And those averages do not include college, which can add another $328,000 to the tab if both kids go to private schools and graduate in four years. Gulp.

There can be additional hidden costs. Mothers with two kids are more likely to step out of the workforce than mothers with one, which results in lost income, lost retirement savings, halted career progress, and difficulty finding a new job when they desire to lean back in. Those who do return to work face what some have called a “motherhood penalty:” A recent study by research group Third Way found that while fatherhood tended to raise men’s earnings, women’s wages declining about 4% per child, controlling for other factors.

Family resources get spread thin in other ways, too. The cliche about the parents fretting over every the eldest’s every milestone while letting number two fend for him- or herself seems to have some truth to it. One recent Brigham Young study found that second children got roughly half an hour less “quality time” each day from parents than first-borns. (Fortunately, baby royal #2 will still get plenty of attention from the world, if not from mom and dad.)

Anxious yet, moms and dads? Let’s come back to the fact that the typical American family has two and makes it work—and hey, the Duggars do it with 19. And if you really want a big family you can find ways to expand your clan within your budget.

“Having a child is an exciting but scary step, and money can be a big part of that worry,” financial planner Matt Becker, father of two and founder of the blog Mom and Dad Money told MONEY for a recent article on how to afford a baby. “I wouldn’t dive in without considering the financial consequences, but I also wouldn’t let them scare you off.”

Related:
How to tell if you can afford a baby

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