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New year, new (financial) you
Try these five totally achievable resolutions
With a new year around the corner, self-improvement may be top of mind for many. We hope that resolve applies to your financial plan too. Statistics show the percentage of people who stick to their resolutions is somewhere in the single digits, but these financial resolutions are well within reach, with a little professional guidance.
1. Close the gender gap in life insurance
We’ve known for decades about the gender gap in salaries and how important it is to close. Progress is being made, but there is still a way to go. Unfortunately, the gap also exists when it comes to life insurance. According to findings from the 2021 Insurance Barometer Study, just 47% of women have life insurance versus 58% of men, and 32% of those with no coverage admitted to needing it. Additionally, women tend to place a lower financial value on their lives than men when buying policies.
If you don’t have life insurance, it’s worth a conversation with an advisor to help you determine how much coverage you need. The age-old formula of buying five or 10 times your annual salary is no longer advisable as there are considerations that go beyond your W2, like women’s unpaid labor in the household (think: laundry, childcare, cooking and cleaning). If you do have protection, revisit the policy’s value; you may need more coverage than you once did.
2. Put your financial health first
Women are still more likely to be caregivers for their children and elderly family members, and they may set aside some of their peak earning years to do so. Additionally, women generally live longer than men, even though they tend to make less throughout their lifetimes. Because of this, retirement savings often suffer and women may find themselves trying to play catch-up in later years. To boot, women often think of their earnings as benefitting the family rather than their future self.
The same way you’re supposed to put your mask on first in a flight emergency, you should prioritize ensuring your retirement savings are on track to cover what you’ll need later. The start of the year is a good time to reexamine how much you have saved and how much you’ll need to retire the way you envision. Give yourself as much time as possible to up your contributions or alter investments if need be.
3. Budget to lighten the load during busier times
It’s happened to all of us: Someone’s out of clean socks or the leaves are piling up in the backyard. We live busy lives, trying to keep up with work and family and take care of our homes – never mind squeeze in time for leisure every once in a while too. Maybe dialing back on how many chores you’re packing in each weekend will give you that time around the fireplace with family or cocktails with friends that makes you feel balanced. But you can’t just let the fridge go unstocked or abandon the dry cleaning.
Consider outsourcing some of the most time-consuming and (dare we say) dull chores to get more meaningful time back in your life. To make it happen, set aside funds in your 2022 budget. As we head into the new year, make a list of the chores that give you the biggest headache (or the ones that will give you the most time back in your week) and calculate how much it would cost to outsource them. Apps like TaskRabbit, Thumbtack and Handy allow you to book services only when you need them, instead of making a regular commitment.*
4. Keep the giving going
One silver lining from the pandemic? Charity giving is up. According to the Giving USA report, Americans gave more money to charity in 2020 than the previous year – up 5.1% year-over-year, or a 3.8% increase when adjusted for inflation. Despite the financially challenging year some faced, the desire to help was high. And studies show single women, holding consistent income and wealth, are more likely to give to charity than single men.
If generosity feels good, work with your advisor to create a plan to keep the kindness going. Create your giving goals, vetting specific institutions, at the outset of the year so you can allocate donations accordingly. We all want the opportunity to help when we see a story on our Facebook feed or a local news report, but earmarking a certain amount at the start of the year allows you to be purposeful with your giving and align it to your values. It will also ensure you’re maximizing tax benefits.
5. Set up a monthly check-in
It’s important to regularly assess your financial health. While automation ensures bills are paid and money’s being invested, it could mean you run the risk that your investments are no longer aligned to your current situation or newly formed goals or you haven’t accounted for changes in your financial life.
It’s as simple as asking Siri or Alexa to remind you to set a financial goal for that month. During one session, you may want to sit down with your advisor and discuss the risk level of your portfolio. In the next, you might want to reevaluate your budget with your spouse or partner. The idea is that you remain in touch with your finances and are continually setting new objectives for your financial endeavors.
Even if you don’t make formal resolutions, these healthy financial habits are something to keep in mind throughout the year to ensure you’re on track for building safety and security – and wealth – in 2022.
While you should set monthly reminders for financial check-ins, consider sitting down with your advisor twice yearly and choose something different to review andreassess each time, like:
- Your spending budgets
- Your portfolio’s risk level
- Your charitable giving allowance
- Your life insurance policies
- Your retirement savings progress
*Raymond James is not affiliated with the phone apps mentioned above. Sources: lifehappens.org; theconversation.com; fortune.com; cnbc.com; moneyning.com; discoverhappyhabits.com
The Great Resignation
Do’s and don’ts for negotiating your next role
Dubbed the “Great Resignation,” a report by Monster.com found 95% of workers are considering changing jobs. Women – disproportionately affected by job loss during the pandemic – may have even bigger opportunities as demand for talent outweighs supply. Now’s the time to reassess and do some soul-searching as you embark on a fulfilling job hunt and pave the way for a brighter future.
Once you’ve brushed off your resume and nailed the interview, consider the negotiation phase as another stage of the hiring process. Women are chronically underpaid (in 2020, 82 cents on the dollar compared to men, according to the U.S. Bureau of Labor Statistics), so this might be an opportunity to make up ground and get what you deserve.
Here are some do’s and don’ts when considering a career move in this candidate-driven market:
Don’t speak first when it comes to salary. Recruiters will often ask your ideal salary range during the screening process, but you don’t have to give it. Do your research on sites like Salary.com, PayScale and Glassdoor first, then think about your worth.
Do consider vacation time. More companies are boasting unlimited vacation policies in their job ads, according to Indeed. And, while that may be your ticket – quite literally – the company culture must be able to support this kind of flexibility. (Some research shows employees with unlimited paid time off actually take less time for themselves on average.) Make sure leaders walk the walk by taking vacations and personal days, and that employees are not expected to always be on call.
Don’t undervalue working remotely. One of the motivating factors employees cite for seeking a new gig is the appeal of virtual work. Many employees got a taste of it during the pandemic and aren’t eager to return to an office without additional perks (some companies are creating outdoor workspaces, for example). Beyond cutting out the commute, working remotely offers the work-life balance many prefer.
Do think about what your new title means. Your title can seem arbitrary if the work environment and pay is what you’ve been after, but it could help shape your future career path. It’s ideal if the title is elevated from your previous role and clearly describes your responsibilities. This will point your career journey in the right direction.
Don’t hesitate to ask for a later start date. While recruiters often expect you to start as soon as possible (after two weeks’ notice, of course), consider giving yourself a week or two “off” in between. Enjoy a vacation or something you rarely have time to do, like volunteering for your favorite charity.
The biggest do during this Great Resignation is to be open to opportunities that come knocking – and negotiate an employment agreement that you just can’t say no to. Once you do, have a conversation with your advisor about boosting your retirement savings or investing in life insurance with your pay raise. Cheers to your next chapter!
Once you land that new job, be sure to:
- Assess what immediate impact you can make in your new role to prove your worth and boost your confidence
- Speak to your advisor about how best to save or invest your sign-on bonus or additional salary
- Evaluate your employer-provided 401(k) or IRA and determine how it fits into your overall financial goals
Sources: cnn.com; fastcompany.com; hiringlab.org; npr.org
How to incorporate more of what you love in your everyday
A recent study found that Americans rated listening to their favorite song, enjoying a nice dinner and watching their favorite movie as the top three “little things” that bring joy. While they’re all pretty easy to incorporate into life, more than half of those polled said they don’t enjoy life’s simple pleasures enough and others felt like they don’t have enough time to.
Sometimes we take little moments for granted if we’re not plugged in (or unplugged, rather) and being mindful. It’s easy to harp on the negatives, but positive thoughts have more power than you think – and it doesn’t have to be a grand gesture to count.
Identify what makes you happy
Flowers delivered on our birthday make us smile, but did you ever think about visiting a flower shop to pick out your own once a month? The idea is to slow down enough to recognize those moments of joy and seek to replicate them more often.
Sometimes finding the positive means feeling the negative first. You can counteract the feelings of longing, like missing your kids during a day at the office, with something good. Frame a bunch of goofy family photos that make you laugh (they say it’s the best medicine, after all), then set them up all over your workspace.
Incorporate simple pleasures in everyday life
We’re glued to our smartphones (potentially a problem in and of itself), so use its features to remind you of the little things that make you happiest. You can use your notes app to jot down what made you smile throughout the day. It’ll become a go-to list to look at when you’re in need of a boost. (There’s something particularly powerful about writing them down – or typing them out – that makes them stick in your memory.) Sit on the front porch with a cup of coffee, take a walk in the park or make a home-cooked meal … you get the gist.
Most small moments don’t need a big budget, but there are some you’ll want to plan for – like exploring somewhere new or luxury bed linens (both of which made a top 50 list of simple pleasures). If that pressed crease in your pants puts a smile on your face, work a weekly dry-cleaning visit into your budget.
While it’s human nature to have what psychologists call “negativity bias” (a totally normal way your brain protects you from future harm), pessimism can take its toll. Balance that with a small dose of joy now and again, and you may just find yourself walking lighter.
If you’re looking to retrain your brain to seek out the simple pleasures in life:
- Focus on the good things, no matter how small and even in the most challenging of situations
- Keep a gratitude journal to hold you accountable for practicing thankfulness daily
- Prioritize what makes you feel happy by setting aside time, energy and a budget to see those things through
Sources: slh.com; healthline.com; huffpost.com