MONEY Love + Money

Why Couples Need to Get Financially Naked

The Voorhes

A new MONEY poll of millennial and boomer couples suggests that baring it all when it comes to money leads to a happier—and richer—relationship.

Katy Klein and her fiancé, Charles Hagman, both 30, began opening up about salaries, savings, and student loans just nine months into dating. The topics came up naturally as the Seattle couple figured out their plans for attending a pal’s wedding.

“Some of our friends were going early and renting a home by the beach,” says Klein, who works in PR. “So we had a conversation about whether that was in our budget … which spurred other conversations.”

Hagman, a software engineer, had intended to dig into those issues anyway. “I wanted someone who had similar savings goals,” he says. But for Klein, it was new terrain: “I’d never laid it all out.” Now that she’s done so, however, she says that financial transparency has set a solid foundation for their marriage.

Experts would agree. “Couples have less conflict about money when they share information,” says Terri Orbuch, a Detroit family therapist and the author of 5 Simple Steps to Take Your Marriage From Good to Great. Knowing where you stand and what you want to accomplish builds trust and a sense of teamwork. Plus, getting on the same page gives you a better shot at hitting your goals and less risk you’ll unwittingly work against each other, she says. Thus, it’s crucial for married couples—and those headed to the altar—to open their books.

A new MONEY poll of boomer and millennial couples suggests that both generations are on board with baring all. When it comes to what partners should discuss before marriage, boomers and millennials both say the docket should include debt (78% of both groups), savings goals (69% and 74%, respectively), and amount saved (63% and 56%).

And yet other research suggests that few married couples truly practice transparency in their daily lives. A few years back, an American Express poll found that 91% of people avoid money talks with their partners; another from last year revealed that only 52% have financial conversations at least weekly. Worse, one in three adults in relationships say they lie to their partner about money, the National Endowment for Financial Education found.

As part of a monthlong series on Love and Money, we’ll be digging into our survey data and suggesting ways that couples can strengthen their unions and their finances. First step: Get financially naked. Here’s how to do it.

Choose a happy moment. Start the transparency conversation around the time of a positive event, like a promotion or a wedding, or at least when there’s an absence of major problems. “Finances are much easier to talk about when you are flush and happy,” says Mary Claire Allvine, a financial planner in Atlanta and the author of The Family CFO. “And opening up in good times makes it easier to talk about money when life changes for the worse.”

If you’re starting in a void, point to an article you’ve read, like this one. Say something like, “It made me realize I don’t know where we stand. Maybe we could take a look some night this week?”

Go full frontal. Crack open a bottle of wine and start opening your books. Begin by making a net-worth statement. This summary of assets and liabilities gives you a framework toward your common goals. It can also help you uncover flaws in your strategy, like debt growing as fast as savings. Use an online net-worth calculator like the one at Bankrate.com or an Excel spreadsheet. Plan to update your numbers quarterly.

If you have the energy, make a list of monthly expenses—review the last few months of bank and credit card statements—so you know where money is going. Or upload your accounts to an online money-management tool like Quicken or Mint, says Miami financial planner Ashley O’Kurley.

Find out your mate’s musts. Setting goals together begins with understanding your partner, says Patrick Wallace, a financial planner with Higher Strata Wealth Management in Hurst, Texas. He suggests you both answer these questions: What are the three most important money lessons you learned growing up? What are your three biggest money worries? What are your three biggest goals? What are the three most important ways you want to use money to leave a legacy? The answers will help your spouse understand what is important to you. “Your goals may still be in conflict,” says Wallace, “but it will be easier to compromise.”

 

MONEY Love and Money

POLL: How Boomer and Millennial Couples Feel About Love and Money

The results of MONEY's exclusive survey on the financial lives of millennial and boomer couples. Bottom line: The differences in how the two generations manage money in relationships are striking. But so, surprisingly, are the similarities.

Last year, MONEY conducted an exclusive survey on men, women, and money. The results captured sweeping changes in the way husbands and wives manage their finances and the impact of money on a marriage, particularly as wives bring home more of the bacon.

This year, we dug down into generational differences: Our latest MONEY poll compares the perceptions and behaviors of some 500 millennials and 500 baby boomers when it comes to their relationships and money. The results reveal distinct differences in their approaches to financial matters. But one theme crosses generations: Couples who are in sync on issues like saving and budgeting feel more financially secure, argue less about money—and have hotter sex lives. Click through the gallery for a look at the numbers.

 

MONEY work life balance

Millennials Want Work-Life Balance Too. Here’s How They Can Get It

Hero Images/Getty Images

Don't be afraid to ask.

We all want a life more that’s more balanced between work and fun. But millennials, more than any other age group, are the unhappiest when they don’t get it.

Nearly one-third of millennials say managing their work, family, and personal responsibilities has become more difficult in the past five years. And nearly half—47%—are working more hours, compared with 38% of Generation X and 28% of baby boom workers, according to a recent survey by Ernst & Young’s Global Generation Research.

More than other generations, millennials want flexibility in terms of where and how they work and are the most willing to take a pay cut, pass up a promotion, or even relocate to manage work-life demands better, according to the survey.

But employers don’t make it easy. Nearly one in six young workers surveyed by EY say they suffer negative consequences for choosing a flexible schedule.

Why should employers care about millennials want? This group—age 18 to 34—now officially outnumber Generation X as the most populous group in the workforce and are on track to surpass baby boomers soon. As employers try to attract and retain the best and the brightest, knowing what’s important to them is, well, important. Turnover among millennials tends to be higher than other work cohorts, and high turnover is costly to companies.

The E&Y survey further illuminates why this generation is more adamant about wanting flexibility. Millennials are hitting the time of their lives when they marry, buy homes, and have kids at the same time the demands of work are escalating.

“Earlier generations were probably too afraid to ask for flexibility. The mindset was that work comes first,” says Rose Ernst, national director of G10 Associates program, which works with companies to hire and retain college graduates and Generation Y workers. But many millennials grew up with parents who got laid off or whose careers suffered during recessions despite putting in long hours in the office. Meanwhile, technology has evolved so it’s easier to work from anywhere.

The dynamic on the home front has also changed. Millennials are almost twice as likely (78%) to have a spouse or partner working at least full time, compared with 73% of Gen Xers and 47% of baby boomers.

Until more millennials advance in their careers and become managers, the reality is that an older generation of workers still sets the standard for where and how work is done at many organizations. Here’s how to ask your boss for a flexible schedule and make it work without hurting your career.

  • Be up front. If you’re interviewing for a job, don’t wait until late in the game to ask about the possibility of a flexible work schedule, says Ernst. Research the company before you interview to find out what the culture is like in terms of nontraditional work arrangements. Clearly some jobs are going to be more adaptable than others. If you’re a human resources person focused on recruiting and meeting with job candidates, you may be able to do some work from home or after hours. If you’re managing a large team of people who work in one location, it’ll be more difficult to work remotely.
  • Be reasonable about why you’re asking. If you want to leave at 4 p.m. twice a week to take a class relevant to work, or if you need a few weeks off every February for volunteer work in Costa Rica, that’s going to be perceived differently than asking to leave early because you play in a softball league on Thursday nights.
  • Have a plan. If you’re already on staff and want to move to a flexible schedule, such as job sharing or telecommuting, prepare a proposal on how you’ll get your work done.
  • Don’t be a flake. It’s obvious but critical to be reliable. You’re much more vulnerable to being judged as a slacker when people can’t see you working. Always be reachable, deliver work on time or early, and make it a point to check in regularly.
  • Give and take. Volunteer for projects when you can or offer to help out colleagues on deadline, especially if others are making accommodations for your work schedule.

It remains to be seen how quickly work norms are changing. But there is power in numbers. “The millennials are a huge cohort of workers who value flexibility more than previous generations,” Ernst says. “That gives them leverage to change how we work.”

TIME Innovation

How the Navy is Taking the Lead on Maternity Leave

The Aspen Institute is an educational and policy studies organization based in Washington, D.C.

These are today's best ideas

1. Here’s how the U.S. Navy is leading the way on maternity leave.

By Alexander LaCasse in the Christian Science Monitor

2. What if growing up “color-blind” means white millennials don’t see racial injustice either?

By Mychal Denzel Smith in the PBS Newshour

3. Jailhouse informants are a leading cause of wrongful convictions. It’s time for them to go.

By Jordan Smith in the Intercept

4. Spend two minutes per hour walking — just walking — to cut your risk of dying by one third.

By Christopher Wanjek and LiveScience at Scientific American

5. Fruit and vegetables worth billions are left to rot because they’re ugly. Now we can eat them at a discount.

By Lorena Galliot in Grist

The Aspen Institute is an educational and policy studies organization based in Washington, D.C.

TIME Ideas hosts the world's leading voices, providing commentary and expertise on the most compelling events in news, society, and culture. We welcome outside contributions. To submit a piece, email ideas@time.com.

MONEY Workplace

The Costly Career Mistake Millennials Are Making

tug of war over money, one person letting go of rope
Sarina Finkelstein (photo illustration)—iStock (4)

More than 60% of millennials don’t negotiate salary when receiving their first job offers. It's costing them big time over the course of their careers.

When millennials land job offers, it seems the only question they’re debating is whether to accept. But they should also be thinking about the terms of that acceptance, since there’s a good chance they’re being offered less than they deserve.

Maybe it is because we are just grateful to get any job offer, or maybe we feel we don’t have enough leverage to make a strong case, but only 38% of millennials negotiate their first salary, according to a new survey from NerdWallet and Looksharp, a company that helps connect graduates with jobs.

That unwillingness to haggle and ask for more is costing us thousands of dollars a year. Three-quarters of employers said they could raise starting salary offers by 5% to 10% during negotiations, according to the survey, which collected responses from 700 employers and almost 8,000 recent grads who entered the job market between 2012 and 2015.

There appears to be little risk in asking for a modest pay bump. Of the grads who did ask for a salary increase, 80% were at least partially successful. The vast majority of hiring managers—90%— said they had never retracted an offer because an entry-level candidate attempted to negotiate. Rather, 76% said candidates who negotiated appeared more confident for doing so.

Successfully negotiating that initial pay raise can also lead to a major increase in your lifetime earnings. A report from the New York Federal Reserve released earlier this year found that lifetime earnings are determined in your 20s, since the bulk of earnings growth happens during your first decade of work. The report, which studied the career paths of 5 million workers over 40 years, found that the average worker’s salary growth stagnates after the first 10 years, and only the wealthiest workers continue to see meaningful increases throughout their careers. That’s why your initial salary might be the most important of your career.

Of course, it isn’t just salary that young workers can negotiate when an offer is on the table. The survey found that of grads who asked for changes to other benefits, many successfully altered the terms of their work schedule (75%), paid time off (62%), bonuses (58%), and stock options (38%).

For help boosting your own chances of a successful negotiation—and to avoid missing out on more than $100,000 in lifetime earnings, according to Nerdwallet—see our Ultimate Millennial’s Guide to Negotiating Salary.

MONEY Debt

Millennials Aren’t Buying Homes, but Not for the Reason You Think

couple looking at house
Troels Graugaard—Getty Images

As student debt has exploded, young consumers are taking out fewer mortgages and auto loans. But are student loans really to blame?

There’s a familiar narrative that the burden of student loans is forcing young borrowers out of the auto and housing markets, crippling their ability to take the same financial steps into adulthood as previous generations.

Think again. A new study from TransUnion says that fears about how much student loan obligations are hindering young borrowers are overblown.

The study looked at consumers aged 18 to 29 who had student loans alongside those who did not, grouped by age and credit score, then tracked their performance on other types of loans in the two years after they started paying off their student debt.

The bottom line: While student loans are way up since the end of the recession, the study found no evidence that such loans are causing young adults to stop opening credit cards, buying new cars, or applying for mortgages. Sure, today’s millennials are doing less of all three than 20- to 29-year-olds did a decade ago—but that’s true whether they’re paying off student loans or not.

According to TransUnion data, the percentage of consumers in their 20s with student debt has jumped from 32% in 2005 to 52% in 2014. The share of student loans in relation to other debt held by young consumers has skyrocketed, too, increasing from 12.9% to 36.8% over the past decade. At the same time, their share of mortgage debt dropped from 63.2% to 42.9%.

But current conventional wisdom about the ripple effect of student debt on other types of borrowing is correlation, not causation, says Charlie Wise, vice president of TransUnion’s Innovative Solutions Group and co-author of the study.

“What we’re trying to do here is cut through the hype and say, ‘what’s the reality?’” Wise says.

The study tracked groups entering repayment at three different times—2005, 2009, and 2012—in an attempt to determine whether performance differed before the recession, immediately following the recession, and more recently as the economy has recovered.

In 2005, a smaller percentage of consumers with student debt had auto loans or mortgages relative to their peers without student loans. But after two years the gap narrowed, and in the case of auto loans, disappeared.

A similar pattern exists for the 2009 and 2012 groups, suggesting that borrowing trends in which individuals with student debt catch up to their peers over a period of a few years have remained steady.

So if student loan debt isn’t causing mortgage and auto loan participation to drop, what is?

Wise points out that about 50% of people aged 18 to 29 have credit scores that qualify them as nonprime borrowers—a percentage that has also held steady since 2005. What has changed, he says, is lending standards, which became stricter in the aftermath of the recession.

The study also shows that young consumers with student debt actually performed slightly better on their new accounts than their peers without student loans.

For example, consumers who started repaying their student loans at the end of 2012 had a 60-day delinquency rate on new auto loans that was 15% lower by the end of 2014 than their peers without a student loan.

The report counters research from a year ago by the Federal Reserve Bank of New York that found home ownership rates dropped more quickly among people aged 27 to 30 who had student debts compared with those who didn’t.

But TransUnion’s findings don’t come entirely out of the blue. A recent Wall Street Journal analysis of data from LoanDepot.com found that loan applicants with student loans aren’t any more likely than those without debt to be turned down for first-time home loans.

And some economists, such as Beth Akers, a fellow at Brookings Institute’s Brown Center of Education Policy, have pointed out that lower participation in the housing market among individuals with student debt is within the historical norm.

Akers says TransUnion’s report that student debt isn’t dooming young borrowers isn’t particularly surprising. “Given the fact that financial returns on investment for higher education are positive and large, the notion that debt is harmful to students is a little puzzling,” she says.

Getting clear answers to the question of how debt affects individuals is challenging, though.

Akers points out that you can’t randomly assign debt to people, and since there are significant differences between the backgrounds and demographics of households with student debt and those without, you can’t expect their behaviors around buying homes or cars to be the same.

Student loan debt may not be overburdening young consumers on a macroeconomic level, she says, but what’s still unknown is the emotional and social cost of carrying such debt.

TransUnion’s Wise describes the study’s findings as encouraging news. For soon-to-be college graduates, there’s evidence that they can stay above water with their loans, and for lenders, there are “credit hungry” millennials who are able to keep up with payments.

Wise’s major takeaway for both groups: don’t despair.

 

More on Managing Student Debt:

The 25 Most Affordable Colleges from MONEY’s Best Colleges
Why You Might Want to Take Student Loans Before Using Up College Savings
8 Ways to Stop Student Loans From Ruining Your Life

TIME

This Is a Horrible Realization About Retirement

losing-money
Getty Images

This might make you lose hope entirely

Retire at 65? Yeah, right.

Multiple surveys reveal that Americans are getting increasingly jaded about their prospects for enjoying a relaxing retirement, so much so that many are throwing in the towel and not even bothering to plan for it at all.

According to a survey of 2,000 Americans conducted for Allianz Life, 84% of them characterize the idea of a retirement where they can do what they want as a “fantasy.”

A second study, this one from the TransAmerica Center for Retirement Studies, also finds that one in five Americans thinks they’ll have to keep punching the clock until they literally can’t work anymore, and 37% expect wages earned from working to be part of their “retirement” income. More than 80% of workers who have already hit the 60-year milestone expect to work past 65, already are or don’t plan to retire at all.

“Retirement has become a transition,” Catherine Collinson, president of the TransAmerica Center, said in a statement.

About two-thirds of Gen X’ers and half of Baby Boomers responding to the Allianz survey think the amount they’re expected to save will be impossible to reach.

Of the two groups, Generation X is the more cynical by far, even though they’re the ones with more time to plan for their retirements. (They’re also the group likely to have higher expenses, though, with obligations like mortgages like kids’ college funds and mortgages that aren’t on Boomers’ radar anymore.)

Only 10% of TransAmerica survey respondents who are in their 40s are “very” confident in their ability to live comfortably in retirement, and more than half of those in their 50s admitted to just guessing how much money they’ll need in retirement. More than two-thirds of Gen X’ers responding to the Allianz survey say they’ll never have enough money to retire, and more than 40% say it’s “useless to plan for retirement when everything is so uncertain.” More than half say they “just don’t think about putting money away for the future”

“Their hands-off approach to planning and preparation is alarming,” Allianz Life vice president of Consumer Insights Katie Libbe said in a statement accompanying the release of the survey.

That’s bad news. Gen X’s reputation for pessimism and angst is on full display in this survey, Libbe points out, and these character traits threaten to undermine their financial future.

Generation Y is more engaged, but they’re not doing so hot, either. The TransAmerica survey finds that young adults don’t have great expectations for retirement, either. More than 80% are worried that Social Security might not be there for them, and more than half aren’t counting on it to provide retirement income for them at all.

The good news is about two-thirds of twenty-somethings are already saving for retirement, but they might not be going about it in the most effective way, given that 37% say they know “nothing” about how they should be allocating their assets.

Still, their longer time horizon gives millennials the best shot at saving for a comfortable retirement, Collinson points out. “They can grow their nest eggs over four to five decades and enjoy the compounding of their investments over time,” she points out.

 

 

TIME Parenting

Why Millennials Are Giving Their Kids Weird Names

And because Millennials love small brands

Every time the Social Security Administration releases the list of most popular baby names in the U.S. for the prior year, observers of the human species try to figure out what the significance of the most popular names are. This is not so surprising since we are the only species on the planet that gets to name its offspring (as far as we know.) Some of these explanations are more speculative than others, but none feels completely right.

Now that this year’s list is out, name-watchers have noted that J-names are getting unpopular while names starting with vowels are hot. Names that end in a plosive (Pete, Jack, Kate) are less popular than names that end in a fricative or a vowel. People seem to be losing interest in New Testament names (Mary is thin on the ground and Michael, who had a 45-year reign as male baby name No. 1, is trending down.) But Old Testament names (Noah, Jacob, Ethan, Abigail and Daniel) are enjoying a spike.

Now comes Goldman Sachs, pointing out in a study of Millennials, that even the most popular names these days aren’t anywhere near as popular as those of yore. Twenty five years ago, 3% of American babies were called Michael, and 2.3% were called Jessica. But Michael and Jessica, who are now of childbearing age, are giving their kids names that fewer kids share. The most popular names in 2014, Noah and Emma, accounted for only 1% of babies each. The report points out that you’d need to add all the Noahs, Jacobs, Liams and Masons together to get the percentage of Michaels there were in 1980.

“We turn to the history of baby names to possibly provide a window into evaluating parents’ expression towards brands,” says the Goldman Sachs report, which identifies two main reasons for the wider spread of baby-naming: “greater diversity among parents and … an appetite for more differentiated and unique brands (which we believe names are).”

That’s right: parents want to give their kids a different name not so they can call it out on the playground and not have five kids look at them, and not so that Olivia (second most popular girl’s name) will be the only Liv in her class, and not so that if she loses her towel at camp everybody will know whose it is, but because they want their kid to have a unique brand. Millennials are disruptive; they prefer small brands. And they don’t want their kid associated with any monolithic name that might dominate the cut-throat baby name market. (Tip: get in early and invest in Gannon and Aranza now.)

Goldman Sachs somewhat gingerly admits it doesn’t know everything about Millennial parents: “…their attitude towards parenthood strikes us as being more idealistic and aspirational,” than their forebears, the report notes. “Having said this, we acknowledge that we are still in the infancy of this theme and are likely to be introduced to changes in values, companies and business models as it develops.”

Just to prove disruption isn’t limited to Millennials, this Gen Xer has put both her kids names in this story. See if you can spot them (hint; they’re lower case.)

 

TIME Workplace & Careers

Millennials Now Largest Generation in the U.S. Workforce

They surpassed Generation X earlier this year

Millennials have now surpassed Generation X to become the largest generation in the American workforce, according to a Pew Research Center analysis of U.S. Census Bureau data.

Adults between the ages of 18-34 now make up one in three American workers, Pew reports. They outnumbered working adults in Generation X, who were 18-33 in the year 1998, in early 2015 after overtaking Baby Boomers last year.

The estimated 53.5 million millennials in the work force are only expected to grow as millennials currently enrolled in college graduate and begin working. The generation is also growing thanks to recent immigration, as more than half of new immigrant workers have been millennials.

The millennial generation as a whole, not just those in the labor force, is also expected to surpass the Baby Boom generation as the largest living generation in the U.S.

 

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