Editor's note: Experts say that women in their 20s are at their most fertile. But before you start thinking about starting a family, make sure you've worked out the financial pros and cons for you and your loved one. Writer Maurie Backman shares her pregnancy surprise: twins! See how two babies meant double the love and double the cost.
Ever since I gave birth to twin girls back in January, people have been asking all sorts of questions about what my life is like now. My answer? My life is hectic--very, very hectic. There's not a lot of time for sleeping, eating or staying in touch with friends. And since I can't hold and feed both girls at the same time, it's inevitable that I'll be faced with a screaming baby at some point during the average day.
When people find out you've had twins, they'll start asking a lot of questions:
- Are they identical?
- Do twins run in your family?
- How big were they at birth?
And they'll also start doling out random (and often-unsolicited) advice like:
- Hire a baby nurse. (We would if we could afford it.)
- Take turns feeding them overnight. (That only works if they're formula-fed.)
- Take frequent naps, or put your feet up and rest. (Ha!)
That last one is particularly unrealistic given that this is a quick rundown of how my time is now spent:
- I change anywhere from 16–24 diapers a day. Of those, approximately one in every five will leak, which leads to my next statistic…
- I do four to six loads of laundry a week.
- My girls eat eight to ten times a day, which means I spend four to six hours on feedings alone.
- I sleep about two to four hours a night, though not in a row. This is actually an improvement from the early weeks, where I averaged 90 minutes on a good night.
The financial reality of raising twins has also been an adjustment. We knew having two babies would be expensive, but check this out:
- We're spending over $300 a month on diapers, wipes and other such basic supplies.
- Our utility bills are 30 percent higher because we're constantly doing laundry and cranking up the heat to keep the house warm.
- Because our babies are small, as twins tend to be, they need extra monitoring, which means additional trips to the pediatrician and two co-pays at each visit instead of one.
- We spent an extra $600 up-front buying two cribs, two car seats and two sets of bedding.
On the other hand, we were pleasantly surprised to discover that having twins doesn't equate to spending double the money all the time. We even found ways to cut corners so that certain line items on our list wound up costing less than anticipated:
- Since our twins are the same gender, we bought one set of clothing for them to share. Plus, people have been showering us with gifts since the girls arrived, and when you have twins, you get two outfits instead of one.
- We only bought one dresser, pack n' play, and swing--items every new parent needs. By not doubling up on these, we saved several hundred dollars. (Besides, we don't really have enough room for two of everything.)
- We are happy to accept hand-me-downs and scored a number of essentials.
- We skipped the baby announcements. Sure, it was tempting, but we figured we had more important things to spend our money on.
Life with twins definitely has its ups and downs, and caring for two babies at once is much harder work than anything I've ever done before. Sometimes, in my emotional, sleep-deprived state, I'll let the challenging moments get the better of me. I've burst into tears on more than one occasion, and I've been forced to skip my morning shower more times than I'd care to admit. But when things go smoothly, there's really no better feeling.
Photo by Mauie Backman, mama extraordinaire.
Editor's note: Experts say that women in their 20's are at their most fertile, but before you start thinking about starting a family, make sure you've worked out the financial pros and cons for you and your loved one. Writer Maurie Backman shares her pregnancy surprise: twins! See how two babies meant double the love and double the cost.
When I first found out I was pregnant, I was both ecstatic and nervous at the same time, and while it took a few weeks to get used to the idea, I eventually got there. But when my first ultrasound revealed that I was carrying not one, but two babies, I was instantly catapulted into a whole new reality.
To say I was stunned would be an understatement. In fact, I'm pretty sure I started laughing and shaking my head like a crazy person the moment my doctor uttered the word "twins." Once I regained the ability to form coherent sentences, I called my husband to tell him the news, and though he's normally a calm, level-headed guy, even he started freaking out.
Though it took some time for the initial shock to wear off, over the next few months we dove right into planning mode. We started making lists of the things we'd need--and the things we'd need two of--and realized we'd have to rethink our budget. After all, we were looking at two cribs, two car sears and twice the amount of diapers and baby wipes. Not to mention double co-pays for medical care.
Just when we thought we'd run all the numbers and found ways to cut corners to accommodate the extra expenses, we hit another snag: transportation. Recognizing that we'd need extra vehicle space, we sold my car and financed a minivan, which added a hefty, multi-hundred dollar payment to our already growing set of bills.
Once we got our finances in order (or, rather, prepared to say goodbye to a large chunk of our savings account), we began the process of preparing mentally for two babies. We realized we'd be doing twice the feeding, twice the diaper changing and twice the holding and comforting while only getting half the amount of sleep you'd normally get in a newborn situation. At first it just didn't seem doable. Since my husband was only able to take a week off of work for parental leave, we figured we'd need some outside help, but a baby nurse just wasn't in our budget. Instead, we decided we'd have to rely on family--and lots and lots of coffee--to get us through those first few weeks.
Between the number crunching and surging hormones, it was hard not to get overwhelmed thinking about what was to come, especially while contending with the physical impact of things. Pregnancy isn't a picnic in general, but by the time I started my third trimester, my stomach was, as my doctor even put it, so large it looked like I might fall over under its weight. This translated into loads of back pain, swollen feet and many, many sleepless nights.
At some point during my ninth months, I ran into an old friend who happened to be pregnant herself. Naturally, I told her I was carrying twins.
"Yikes!" she exclaimed. "I'm so glad that didn't happen in my case."
But here's the thing: I'm really thrilled that it happened to me. There's no question that carrying and raising twins is tougher than just having one baby. There's a lot more preparation, many more medical appointments and a whole extra heap of stress involved. But once you get to bring those babies home, you realize there's no greater blessing than having twins, and that all the hard work is more than worth it.
Short on cash? That doesn't mean you have an excuse to forgo exercise. Getting your workout in is especially important if you lead a sedentary lifestyle. Here are some free and cost-friendly ways to get a workout in without forking over the dough.
If you have a desk job or spend most of your day sitting in class, be sure to walk around at least every 45 minutes. Refill your water bottle or walk to the water fountain to sneak in some movement throughout the day. Practice some chair yoga or take mini breaks to do a few stretches in your cubicle. If the weather and distance allows, walk or bike instead of driving and take the stairs instead of the elevator.
Borrow or trade fitness equipment and/or DVDs from friends and family when they abandon or complete their own resolutions. If you have a yoga DVD and your pal just finished Insanity, negotiate a trade to try a new workout.
Find dirt or paved trails or neighborhood parks in your area where you can hike, ride your bike, walk, roller blade or skateboard. Invite friends or family along to keep each other accountable and active. As you walk or run, stop for some lunges, squats, push-ups or jumping jacks.
Research yoga classes in your area. Studios and yoga apparel companies often host free community classes each month. Sometimes these are donation based but many times they are completely free. Yoga and Pilates studios may even offer a free class card to try out their classes.
Find a community or a friend's pool to use to swim laps. There are also aerobic exercises you can do in the water.
Put the gym in your apartment complex or university to good use. A membership to your college's gym is often included in the tuition price. If there is no gym in your dorm or apartment building, it's likely that friends and family have one you could use as their guest. An added benefit is that you can have a gym date with a loved one.
If you prefer solo workouts, search for fitness videos on YouTube and other websites. Yoga International, for instance, has many free videos available. The BeFit YouTube channel has almost 1.5 million followers who subscribe to its training videos. You can find dance, yoga, cardio and many other types of workouts. Celebrity trainers like Denise Austin lead you through your exercise session.
An unlikely source of fitness advice may be Instagram. The fitness community is active on the social media site. Search for keywords or hashtags such as fitness or workouts to find "fitspiration" videos, photos and tutorials. Well-known fitness trainers like Natalie Jill share videos with how-to's. Similarly, users of Pinterest have shared links, photos and graphics that illustrate how to do workouts. (Just make sure that if you go this route you check to see whether the source of the information seems credible.)
With so many ways to get a workout in for free or little money, there's no excuse to not keep moving.
If you've attended any two or four-year universities or plan to in the future, you've probably heard the old mantra that the cost of education is an investment into your future. Sure college is expensive, and by attending you're delaying earning a salary by a few years, but the payoff is what makes it all worthwhile.
However, things have changed since you were a kid. The average debt per borrower, adjusted for inflation, has more than tripled in the last 20 years. And anyone who has graduated and begun the job search since the Great Recession can tell you that earnings haven't kept that same pace. In fact, while the average amount of student debt increased by 35 percent between 2005 and 2012, median annual earnings for those between 25 and 34-years-old holding a bachelor's degree, and no advanced degree, have fallen.
Enter student debt relief programs. In 2007, Congress passed the College Cost Reduction and Access Act. There are a number of elements to this law including gradual reductions in interest on student debt, increases in Pell Grants, the Income Based Repayment (IBR) plan (which I discussed in a previous Brass blog) and the Public Service Loan Forgiveness (PSLF) program.
Programs to consider
The PSLF is unique among student loan relief programs in that it can potentially eliminate all student loan liability for students who pursue a career in public service. While both the IBR and PSLF put a cap on debt payments equal to either 10 or 15 percent of the student's disposable income, those enrolled in the PSLF have their remaining debt forgiven after ten years. Those in the IBR have to wait 20 to 25 years, depending on when they opted into the program.
The other significant difference in the benefits of the PSLF versus the IBR is that IBR participants face a potentially massive tax burden once their debt is forgiven. Debt forgiveness is taxable income, meaning that depending on your tax bracket, you are going to liable to the IRS for roughly one third of your outstanding debt balance after "forgiveness." This is not the case with the PSLF. After ten years, your remaining debt is gone, and, under Section 108(f) of the Internal Revenue Code, there is no tax on the forgiven debt.
For those who have dreamt of a career in public service since they could walk--or at least since their first political science or social work course--the PSLF presents a no-brainer financial boon. For everyone else, it requires weighing the benefits of total loan forgiveness against greater career flexibility and the associated salary considerations.
The Department of Education has put together a handy FAQ on the PSLF, but here are some high-level conditions to keep in mind:
- PSLF is only available for Direct Loans
- PSLF must be based on one of the following repayment plans:
- Participants must complete 120 separate, on-time monthly payments on their Direct Loans
- Qualifying Employment includes any federal, state or local government organization or agency and most not-for-profit organizations, including but not limited to those classified as 501(c)(3) organizations.
There's nothing wrong with paying for a good product or service, but what if you don't get what you paid for?
According to customer service training professional Ruby Newell-Legner, most people would just walk away. Newell-Legner states in her book, “Understanding Consumers,” that only 4 percent of dissatisfied customers actually voice their complaints to the business. The rest might shop elsewhere or gripe on Facebook, but never actually let the business know.
In December, I was co-hosting a wedding shower for a friend--an expensive event for a bunch of cash-strapped twentysomethings. So when our $400 catering order arrived late, cold and missing an item, I was the only one willing to ask for a much deserved discount (and we got one, too).
It's much easier to just fume over a bad experience and give a bad Yelp review, but if a refund request is warranted, be the person who speaks up and gets your hard-earned money back.
Know that businesses want you happy.
The Customer Experience Impact Report conducted by marketing company Oracle shows that brand loyalty pays. 89 percent of survey-takers said they would take their business elsewhere after a bad experience. If you eat at the same place often and one night your service is awful, remind the manager--tactfully--that a discount tonight will assure that you don't find a new favorite place to eat.
It's crucial for young adults to be as mature as possible when making a complaint. The last thing you want is for a business to dismiss your problem because they don't take you seriously. The U.S. Office of Citizen Services’ Consumer Action Handbook says to "be brief and to the point. Don't be angry, sarcastic or threatening."
Relate to the person.
Found a manager who will hear you out? Introduce yourself by name and call them by theirs. Explain why the service or product was unacceptable and thank them for listening and (hopefully) working to resolve the problem. Courtesy goes a long way.
Ask for what you want.
Don't be afraid to state your case and ask for what you deserve. Conversely, if your appetizer was bad but your entrée was good, don't demand a free meal. Be direct and reasonable.
Explore other options.
Not all businesses got the memo that the "customer is king." If you don't get the result you want--especially if you've spent a lot of money--the Federal Trade Commission offers resources for resolving complaints, like filing a consumer complaint or how to pursue legal action.
And if all else fails, post that Yelp review and take your money elsewhere.
Do you know where your beliefs, ideas and values about money come from? The answer is likely your parents or whoever raised you. But how do you know when they're wrong?
When I was 28, I spent my life savings--all of it--at once. I did it to launch my own business--a cutting-edge, non-profit to build the life I had wanted since I was a teenager. My parents, however, were not entirely thrilled. Their warnings about debt, failure and that looming cloud of "the future" grew louder every time I wired money to buy equipment or declined more secure job offers.
How did I know it was time to heed my own advice and not theirs? Consider the following as you decide what to do with your dollar bills:
- What does the research say? The wide world of Google is at your fingertips, and your own financial institution likely offers periodic consulting perks. What do experts other than your parents recommend? Always conduct your own research before making financial decisions; at the very least, you'll learn something, and perhaps acquire mentors whose objectivity is less in question. In my case, a fellow entrepreneur in my sector was a nice compliment to the broad-spectrum finance skills I learned from my parents.
- Where do you currently stand? Are you responsible for children, pets or a mortgage? As you become more mature and shoulder more financial commitments, your risk tolerance will change. Think critically, creatively and candidly. Scads of folks told me that launching a business while raising a six-month-old by myself was pure madness. But I acted when I did because the numbers lined up--raising an infant is cheaper than a school-age child, which meant I had several years to make this business a success before family finances became pressing. No matter what anyone said, the time was right for me to take a financial risk.
- What is your goal? Are you close to retirement? Saving money for a down payment on your first house, an engagement ring or a career move? Money is simply a tool to reach a desired end, but you never know how much you'll need if you don't know where you're going. Once you determine your goal, remember to add a cushion for inflation, taxes and the unexpected.
- Do you have a backup plan? Those who love you often give financial advice from a singular perspective--security. But security comes in many forms, and optionality is one of them. My "Plan B," for instance, was the knowledge that if my business failed, I would know by the time my child was in school; this meant that my resume would still be relatively up-to-date and I could reasonably expect to return to the corporate world. In the interim, I developed the relationships and support structure necessary to freelance as a consultant when ends weren't meeting well. Sharing my backup plan with loved ones reassured them that I was planning ahead.
- What role does money play in your life? Money touches everything in our lives and how we use it reflects our values, desires and priorities. How do you want to live? Are mansions important to you? Is a certain type of schooling for your child important? What is your personal money psychology; are you primarily concerned with security and always braced for the worst to happen, or do you have a more relaxed relationship with the green stuff?
No matter what your current financial position is or where you're going, you're going to meet a lot of folks who have a lot to share. Take it all in; develop the analytical skills necessary to evaluate the quality of the advice, independent of the source, and decide in accordance with your own values and goals.
April 15 is Tax Day, and nearly 90 percent of people have already received their refunds. The average refund at this point? $2,893.
That nearly $3,000 could make a big difference in your life depending on how you spend it. According to a bankrate.com survey, 34 percent of people will pay down debt, 26 percent will use it on necessities like food and bills and 33 percent will save or invest the money.
Paying down debt and paying for necessities are absolutely crucial. If you haven't done that yet, you can stop reading right here, my friends. However, if you're thinking about putting your money to work, read on for an investment that could make you $100,000 or more over the next 10 years.
Why Investing in Yourself Makes Cents
Of the many ways tech companies keep their employees happy, tuition reimbursements are one of the most innovative because it's an investment that results in better employees. Take a page from their playbooks by using your tax refund as an investment in yourself.
You can also consider investing in the stock market. CNN's tax return calculator does the math for you: If you invest $1,000 at eight percent (a hopeful stock market return), you'll have $2,159 after 10 years. Not too shabby.
If you’re working for $10 an hour, full-time, you're making $400 a week, pre-tax. That's $20,000 a year over 50 weeks. If you can get a raise at your current job (or get a new job!) to $15 an hour, that yearly total becomes $30,000. Each $5 an hour more you can earn is another $10,000 a year. So if you only do that one thing, that's $100,000 after 10 years. Compare that to $1,159 and see how investing in yourself can have exponential returns.
Here are three ways you can use your refund to learn more and be better positioned for raises, promotions and completely new jobs.
Learn from Others
You already know there are free online colleges and financial aid through sites like Coursera and Kahn Academy. With Coursera's specializations, however, you get a focused curriculum to master any number of skills, even if it costs you (in-state costs can range from $300-400 per credit hour). Besides, putting down some money can be a form of accountability, insuring that you actually finish the courses. To see an example of mastering MOOCs, check out this interview with Laurie Pickard of No Pay MBA.
If you want to get specific skills, look into workshops at an organization like General Assembly, which has a number of locations, as well as online courses related to topics like web program-ming, branding and design which can introduce you to new concepts at affordable prices (rang-ing from free meet-ups, cheap one-off workshops and pricier weekly evening classes).
Learn from Yourself
If you have an interest in business or entrepreneurship, there's nothing like firsthand experience. Check out Chris Guillebeau's $100 Startup for an amazing amount of resources and motivational anecdotes. If you want to see an actionable plan for launching a website, this redditor writes a month long guide to launching a project. He compares the amount he learned in that one month to a do-it-yourself MBA.
Create Your Own Opportunities
By earmarking some of your refund for future opportunities, you allow yourself to say yes more often. Put aside an amount in your monthly budget that'll allow you to do things like take a men-tor to dinner or drive to another city for a conference. You can free up time to focus on these op-portunities by outsourcing errands with services like Wash.io and Fiverr.
The temptation is to put money away for the future (or, let's be real, spend it!), but you should consider spending the money in an intentional, effective way. Investing in yourself is one of the best investments you can make.
When my husband came to find me a few weeks ago after putting together our taxes, I could tell from the look on his face that things weren't good.
“How much?” I asked, assuming right off the bat we were looking at owing money. Well, I won't share the exact amount--mostly because it pains me to even put it in writing--but let's just say we somehow managed to underpay the federal government well over $2,000 and as a result found ourselves dipping deeply into our savings account to come up with the funds we owed.
A Good Thing or a Bad Thing?
The funny thing about owing money on taxes is it's not necessarily a bad thing. Although nearly eight out of every ten people get federal tax refunds each year, some accountants will tell you that getting money back means you overpaid throughout the year and therefore essentially gave the government an interest-free loan.
On the other hand, there's the psychology of the refund to consider. Many people who get refunds don't necessarily expect to receive money back from the government, and although they've technically paid more than they needed to up front, they're able to enjoy their newfound money once it comes in. Along these lines, those who owe money unexpectedly often have the opposite experience--that they're suddenly being robbed of money they thought was rightfully theirs.
Regardless of where you tend to side in this debate, one thing's for sure: You don't want to owe so much money that you’re forced to pay a penalty. Usually you can avoid this if you:
- owe less than $1,000
- paid at least 90% of the taxes you owed for the current year, or 100% of the taxes you paid last year
Avoiding the Situation in the Future
Unfortunately, if you've discovered you owe money this year, it's pretty much a lost cause. But there are steps you can take to avoid owing money next year.
- First, check your withholding status--that's the amount your employer is taking out of your paycheck. Did you claim too many allowances? You may need to correct your W-4. You can also try using the IRS's estimated tax calculator to see if you're paying enough and then adjust your withholdings accordingly.
- Next, review other sources of taxable income. Did you earn a lot of money from a savings account or Certificate of Deposit? Did your investments pay dividends that propelled you into a higher tax bracket? Growing your money is never a bad thing, but if it causes an uncomfortable situation come tax time, you may want to rethink your current strategy.
- Finally, if you're worried about owing but don't want to overpay and lose out on interest, you can leave your W-4 as-is but create a separate savings account designated for tax money--money that, in your mind, isn't really yours. You can then put in money each month so that it accumulates over the year. If, come tax time, you see that you owe money again, you can simply dip into your special account to pay the government, as opposed to having to tap into your savings. And if you find that you don't owe on your taxes, that money is yours to keep, and you'll have earned interest on it as well.
This year's taxes were a major wake-up call for us. Although it was a lousy way to learn our lesson, we're already taking steps to get smarter and avoid a collective panic attack come April of 2016.
You've marked the date on your calendar, and you've done your best to get all your paperwork in order. But what happens if come April 15, you're just not ready?
If it's any consolation, you're not alone. According to 2009 data, more than 10 million people filed income tax extensions, and last year, an estimated 12 million taxpayers had no choice but to request more time. If filing on time just isn't in the cards for you this year, worry not. Requesting an extension is easier than you'd think.
How and When to File
To file an extension, simply fill out Form 4868 and submit it either by mail or online. All you need to do is file this form by April 15th and you'll be granted an automatic six months of leeway, thereby extending your deadline until October 15th.
Believe it or not, you don't need a specific reason to request an extension; the IRS won't care if you're filing your extension due to sheer laziness and procrastination as long as you do so on time. But if you happen to have a complicated financial situation, filing an extension is more than justifiable. The same holds true if you've yet to receive all of your tax information from your employers. This is something that frequently happens to freelancers and those who hold multiple jobs.
Another good reason to request an extension is to allow your accountant extra time to review your paperwork during his or her busy season. Many accountants find themselves overwhelmed in the weeks leading up to Tax Day. If you require the help of an accountant but can't find one to squeeze you in, an extension can buy you the extra time you need for a professional to assist with your filing.
The Downside of Tax Extensions
One thing to keep in mind is that filing an extension doesn't give you extra time to pay the government any money you might owe; all it does is offer you six extra months to complete your paperwork. What this means is that you need to have a general idea of what you owe the government by April 15th and pay that amount on time to avoid late fees and penalties. For many, this defeats the purpose of filing an extension in the first place.
Similarly, you must be sure to submit Form 4868 on time if you want to avoid a failure-to-file penalty. The failure-to-file penalty is usually 5% of the unpaid taxes that are due, whereas the failure-to-pay penalty is 0.5% of your unpaid taxes.
Another point to consider when requesting an extension is whether you're owed a refund. If you think you'll be getting money back from the government, you'll have to wait even longer for that refund check should you choose to file an extension.
So What Should You Do?
If you're worried you won't be able to file your taxes correctly by April 15th, be it due to a lack of information or a lack of time, your safest bet is to request an extension and do your best to estimate how much you owe the government. If you're convinced you owe nothing or think you might end up owing a truly minuscule amount, you can take your chances and wait till you've got your paperwork in order to whip out your checkbook. (The penalty for a $100 underpayment, for example, will be a mere $5.) But if you're looking at owing serious money, it's best to file that extension and pay up.
The average tuition and fees for full-time, in-state students at public four-year universities rose 2.9 percent from 2013–14 to 2014–15, according to the College Board report. The figure is higher for out-of-state students and those at private universities. Financial aid often does not cover all expenses; so many students seek additional ways to bring in some extra cash. One way to do that is to turn a hobby, interest or skill set into a way to make money. Consider any training you receive as an investment. You acquire a special skill that will benefit your career and your life.
For example, I chose to attend a yoga-teacher training program to not only save money on fitness classes, but to also help bring in additional income and set my own working hours. However, the investment was hefty: $2,600 for a 200-hour program over three months. I found that the program has opened many doors. Now I don't pay for yoga as much, which saves me at least $80–$100 a month, or more. I was also able to find a paid position teaching at least two classes a week with plenty of opportunities to pick up additional classes. I find that it has been easier than I thought it would be to make back the investment.
Turn a hobby into a marketable skill.
Not all skill-certification programs will require such a big expense or even your physical presence. You can take Web design and foreign language courses online, for instance. But although there are skills you can learn on the Web for free, certifications give you more clout with potential employers or clients. Many yoga studios require a Yoga Alliance membership or other certification to teach at their facilities.
It's a great idea to become proficient in a skill related to your major or job, but you can choose any skill that interests you. Perhaps you enjoy creating artwork or blogging. You might consider becoming proficient in Web design and then getting paid to create websites for people (perhaps other bloggers). Attending a lifeguard training program can help you make extra cash during the summers or school breaks. Massage therapists and fitness trainers are other options. People in these positions can work for themselves or at spas or gyms. They can work at multiple facilities and set their own hours.
Why it's worth it.
Often, acquiring a special skill offers additional benefits. As a yoga or fitness teacher, you have the flexibility to pick up as many classes as you'd like. It's easy to find a substitute for a class if you need to work on a school project. In addition, you may get discounts on food, merchandise or services at your studio. Also, earning cash while improving your health is a win-win.
Developing a special skill is an asset that looks desirable on a resume. Juggling school and working helps enhance your time-management and organization skills as well. In my case, becoming a yoga teacher shows that I have leadership abilities and helped me improve my public speaking. In addition, I can freelance write about yoga for publications because I am more knowledgeable about the subject.
Students looking for a fun, different way to make cash while in college have a myriad of options if they are willing to invest in themselves. Acquiring a special skill can pay off personally and financially.