It’s been an incredibly difficult few months for so many of us — millions of Americans are out of work, and are job searching now, seeking their next big opportunity. But the truth is that with more than 30 million of us looking to snap up that next gig, it’s more important than ever to showcase our unique experience. That’s why we have to make our skills, talents and accomplishments shine, and these days, our LinkedIn profiles are increasingly seen as a living resume — a digital snapshot of who we are and what we bring to the table. Today, LinkedIn boasts 675 million members in over 200 countries, and the site is growing at a rate of three new members per second.
So, just how do we put our best foot forward on the world’s largest professional networking platform? On this week’s episode, Allison Nunes, Director of Global Events for LinkedIn, tells us all how best to leverage our network and edit our profiles in a way that helps us stand out. Allison talks about what she’s learned during her 7 years at LinkedIn, and shares her best tips for making sure your profile looks its best — she’s a workshop ambassador for the company’s “Rock Your Profile” program, and she shares all her secrets!
Allison discusses all the ins and outs of:
- How to set job alerts
- How to let recruiters know you’re open to being approached for new opportunities
- Why it’s important to be one of the first candidates to apply for a job
- How to set yourself up to take advantage of one-click jobs that are “easy-apply.”
- The most important components of your profile, and how to ensure they’re properly filled out
- The top things to avoid to ensure you don’t make an unprofessional impression
- Why you should never write your profile summary in the third person
- Why it’s good to show humor and personality, and how you should do it
- The best ways to stand out from the crowd
- How best to add detail to your “experience” section
- How many recommendations you really need, and how to ask for them
- How to add and remove skills, and why you need them
- Ways to make your profile visually more interesting
- Why volunteer experience is valued as highly as professional work experience, and how to highlight that on LinkedIn
- How to announce to your network that you’re looking for work
- How best to be active in your feed, and how to curate your feed
- The importance of referrals, and why you’re more likely to get a job by someone referring you to a company they already work for
For those interested in growing your network, Allison discusses the strategies behind sending requests, and the differences between following someone vs. connecting with them personally as part of your network. Where connections are concerned, she says, quality is far more important than quantity. “Think of your network as your inner circle. You don’t want to just let anyone in, because they will get access to you and your network when you do,” she says.
In Mailbag, Jean and Kathryn share some joy from a listener who paid off her debt, and discuss the safety of online savings accounts, as well as how quickly you can get your money out of them when you need it. We also discuss how older women are creating alliances and support structures that may replace some of their need for income in retirement (think Golden Girls!). Lastly, we guide a woman who’s curious if she should buy a historic home with the money in her thrift savings account, or if she should get a mortgage.
In Thrive, Jean dishes on financial anxieties of all kinds, and why 23% of Millennials say they’re often “physically ill” due to their money worries. Jean walks us through a step-by-step plan for shedding these anxieties and getting back on track.
We promised we’d link detailed instructions for all of Allison’s helpful tips and tricks — you can find them all here:
- LinkedIn Learning Path for Working From Home
- LinkedIn Learning Path for Job Searching
- How to Let Recruiters Know You Are Open to New Opportunities
- Best Practices for Searching Jobs on LinkedIn
- How to Create Job Alerts on LinkedIn
- Best Practices for Posting & Publishing Articles on LinkedIn
- Contact for Allison Nunes (who kindly offered to be a resource for HerMoney’s listeners — thanks, Allison!)
Allison Nunes: (00:01)
If you’re just listing your job title, that is not enough. You need to put detail underneath each role that you’ve had – what you’ve accomplished, what your responsibilities were, projects, impacts you made, show metrics. You need some detail under there.
Jean Chatzky: (00:21)
HerMoney is brought to you by Fidelity Investments. Fidelity is committed to helping clients through any market conditions with financial planning and advice when you need it most. Learn more at Fidelity.com HerMoney comes to you through Megaphone.
Jean Chatzky: (00:39)
Hey everybody, it’s Jean Chatzky. Thanks so much for being with us today on HerMoney. Boy oh boy, has it been a tough slog the past few months for so many of us. We’ve got tens of millions of people out of work. I know that there is a good chance that many of you who are listening to me today are either out there searching for that next job or that next opportunity. And the truth is with so many people trying to snap up their next gig, it’s going to be more important than ever to stand out from the herd, to ensure that every time you send out an application, every time you make a connection, you’re making your skills and your talents and your accomplishments really stand out. But of course, these days it’s not just the applications or the resume that counts. It’s the profile that we put up at LinkedIn, which is increasingly seen as a living resume. It’s a digital snapshot of who we are and what we bring to the table. LinkedIn has 675 million members. I’m proud to say I’m an influencer in over 200 countries and it is growing, oh my God, at a rate of three new members per second. Today we are joined by Allison Nunes. Now Allison is the Director of Global Events for LinkedIn. She’s also a workshop ambassador for the company’s Rock Your Profile program. It helps members create a profile that enables them to truly shine. And Allison is a member of our community. She actually reached out to us and she said, hey, this is what I do for a living, but I think I can help the folks at HerMoney, the people who listen to HerMoney. And we were like, yeah, come on. So Allison, welcome.
Allison Nunes: (02:39)
Thank you. Thank you Jean for having me.
Jean Chatzky: (02:42)
Well thank you for reaching out. I got to say, we got your email. We were so excited. And both Kathryn and I took one look at it and we were like, yes, we need this and we need it right now. How long have you been at LinkedIn and how did you get to teach people to rock their profiles?
Allison Nunes: (03:00)
So I’ve been at LinkedIn about seven years, but even prior to joining LinkedIn, I was already drinking the LinkedIn Kool-Aid and used LinkedIn daily for my previous role. And at LinkedIn we have this program to help our members, our customers, our communities, to just make sure their profile is looking their best and to really leverage LinkedIn and get everything out of it that you can. I always found that I was giving unsolicited advice to people that I would be doing business with or something and say, hey, you know, you really could do this on your profile. And then I definitely just wanted to jump in and be a part of this program, got certified and now more than ever it’s been all hands on deck at LinkedIn. We’ve been trying to get people through this difficult time.
Jean Chatzky: (03:46)
What have you started hearing from people or I guess it’s probably not started. What have you been hearing from people as the unemployment numbers have been creeping up above up, up, up, and what has it been doing to your traffic?
Allison Nunes: (03:59)
I mean we’re seeing lots of traffic still in a different way. Of course, COVID-19 is the most trending hashtag in the last several weeks and I think 30% of our content today is around the pandemic and people talking about it. And the traffic is different in our business. Hiring is down, but learning is up. So we’re just trying to be agile and pivot and help our customers and members where we see that they need more help. And maybe it was different than it is today, a few months ago. So we’re just trying to be there to support everybody.
Jean Chatzky: (04:33)
I know that a lot of people advertise when they’re hiring on LinkedIn, as well as search for jobs on LinkedIn. What are the employers who are actually looking for help, looking for these days, and what is that telling us about what the market is going to look like going forward?
Allison Nunes: (04:54)
So there’s millions of jobs available on LinkedIn. What our editorial team has done is created an urgent jobs board to post the most urgent jobs. What’s open, who’s hiring. That’s posted on your homepage. But there’s also other jobs available and companies that have been able to turn to remote working and be resilient and others that are seeing a pickup in their business, whether it’s something online commerce. We’re finding that the professional services orgs are still hiring. Tech is still hiring. You know, I think people just need to pivot. Obviously industries like hospitality, entertainment, travel, hit very, very hard. The restaurant business. So I would just encourage people to see what the urgent jobs hiring are and not give up.
Jean Chatzky: (05:43)
Yeah. But it’s a myth, right? That you can’t get a job during Coronavirus. I mean my daughter, like many, many people got laid off and she, you know, she took a couple of weeks and then she started saying, well when do you think it’s time for me to start looking? I think it’s time for you to start looking now. And she basically came back at me cause I’m her mother and said nobody’s going to hire during this time. But that’s not true. Right?
Allison Nunes: (06:09)
That isn’t true. And we would say, don’t wait. You know, the market will come back and the jobs market will come back stronger. But there are people hiring and I would tell people, lose your plan of maybe what you think your job should look like today and maybe be open to other opportunities. As job seekers, we just really need to be focusing on our “A” game all the time. Updating your profile and setting job alerts. One thing with LinkedIn, you can set job alerts, you can set multiple job alerts on your job page. And that way you can be the first to apply when things come online. It’s so important to be the first to reply because when you’re in that first wave of candidates, chances are you’re going to be contacted. So very, very important. You can also, we have a feature that you can also let recruiters know that you’re open to new opportunities. It’s not a public feature that the average member could see looking at your profile. But nine out of 10 recruiters are using LinkedIn, so you definitely want to leverage all of those tools. You want to follow hashtags like hashtag now hiring, hashtag get hired. Hiring any of that content or hashtags are going to curate what’s in your news feed. And so when you’re engaging on LinkedIn every day, you’re going to see who’s hiring. And also this is a time to learn new skills, sharpen your existing skills. LinkedIn, we have a huge learning platform with over 16,000 courses available in multiple language of all sorts of areas, from technology to business to creative. And this is the time to, you know, be better and also always leverage your network.
Jean Chatzky: (07:44)
Can I just dig into three of the points that you just made? Because if I were going on LinkedIn right now, I would not know how to do these things. And granted we all know where my tech skills lie, but let’s just assume that other other members of our listenership are like me. If I wanted to set job alerts, how do you do that?
Allison Nunes: (08:04)
Yup, so when you log into LinkedIn, you’re always going to see your news feed and what we call your home page. So at the top, in your toolbar, is the job section, your jobs page, and you click on that, go right into the job. And on the top it’ll walk you through how to do alerts. I’ll also send some details about that that we can include in the show notes for the listeners. Some links that will show exactly step by step. But you want to set these job alerts, set them in multiple ways, multiple titles, industries, everything that you’re looking for that you identify with or that you want an alert to come to you when a job is posted or existing job. And again, really important to be the first to apply. Some companies have an option that they choose, it’s not LinkedIn that chooses, what’s called easy apply. If you see an “easy apply” button next to a job posting, that means you can easily apply with your LinkedIn profile. And not having to send a separate resume. So again, why it’s so important that your profile is up to date and complete where you just one click, that easy apply and your profile’s headed to that hiring manager. And then I’ll also send, it’s just a quick click, really easy, the feature about being open to new opportunities. I would say open that. And even people with jobs today, you know that are looking, open to new opportunities. It just lets the recruiter know that you’re a candidate that would be open for a conversation.
Jean Chatzky: (09:31)
Yeah, I was going to ask. Is that button somewhere on the page that “open to new opportunities” button?
Allison Nunes: (09:36)
Yeah, it is. It’s on your profile page and it’s also on the jobs page.
Jean Chatzky: (09:41)
Okay. All right. Fantastic. Let’s talk about the profile itself. What are the components that everyone needs to know about what’s just, you know, the baseline for having a good profile and then we’ll get into how to make it stellar, but how do you just get through the door?
Allison Nunes: (09:58)
Yeah, so your profile is your digital portfolio and it tells your professional story. It’s your first impression. So I think some people just create one, throw it up there just to be there. But when it’s not complete, it’s leaving you a bad impression. And I say it’s like showing up for an interview in pajamas. So you wouldn’t do that. So your minimum requirements on a profile, you need to have a photo. A photo that’s current. A photo that looks like you. A photo that is just of you. Not your partner, your family or holding a big fish or something. You know, unless you are a commercial fishermen or something. But a photo that looks like you. It doesn’t have to be a formal headshot. It could be something you take on your phone, a selfie. LinkedIn also has crop capabilities and filters that you can change the lighting. Just something that’s going to represent you well to your community. So a photo first and foremost. And the summary is your about section. It’s the section I feel that it’s most important. So if someone goes to your profile for 10 seconds, they’re going to go to that about section, your summary section. And they should be able to read a few sentences about you and get a really good sense of who you are. And you always want to write that in the first person. Never write it in the third person. It’s too formal. You know, we want you to have an authentic voice on LinkedIn and share who you are. Don’t be so formal. Highlight your skills, what you’re looking for. Again, the summary, really important. People It’s an area to show a little bit of personality as well. I was meeting with someone earlier this week and of course before each meeting, best practice, when you don’t know someone, look at their LinkedIn profile and I was reading her about section and it talks about her job and then she referred to herself as a tater tot enthusiastic. I was like, go girl. Good for you. This just shows some personality. We want you to be your authentic self and show some humor and stand out from the crowd. So summary is really important. The other area that I think most people think is complete but is not is the experience section. So when you’re putting your professional experience, if you’re just listing your job title that is not enough. You need to put detail underneath each role that you’ve had, what you’ve accomplished, what your responsibilities were, projects, impacts you made. Show metrics. You need some detail under there. Most people have very, very little detail or maybe they have it under one job, but everything that you have listed, all of your professional experience, you need to have some detail under there. And we say write it in short form paragraph, not bullets. Just highlight the big things and accomplishments and what you did because when recruiters are doing searches and you know the job title is not going to tell your whole story. So very, very important. And there’s a skills segment on your profile. You can list up to 50 skills and I’m sure most of us have at least 50 skills to list. And also you know you want to complete that. You can show what shows on your profile, your top three skills and then they have to dig in a little bit more to see everything else but easy to add and remove skills. Also the recommendation section.
Jean Chatzky: (13:13)
Before you dig into recommendations, I actually want to pause because we’re getting a lot of information here and I want to kind of get to the sense of all right, what’s really essential? What is overkill? What’s TMI, right? Where do we let people too far into our worlds where they don’t even want to be? But before I do that, let me just remind everybody that HerMoney is supported by Fidelity Investments. For more than 70 years, investors have relied on Fidelity to help plan for their financial futures and as always when the unexpected happens, Fidelity is there to help you work through it with financial planning and advice for what you need today and tomorrow, helping to make it all clear. To see how Fidelity can help you and your family on the path forward, visit Fidelity.com. And we are back with Allison Nunes, Director of Global Events for LinkedIn and workshop ambassador for the companies Rock Your Profile program. Okay. 50 skills, Allison? It occurs to me we’re maybe getting into the TMI portion of our program, right? What’s too much information?
Allison Nunes: (14:26)
You know, I think just really focusing on what you can bring to the table, what your skill set is, and doing it in a succinct way that when someone’s viewing your profile, they get a really good sense of who you are. So under the experience, you need to think about what you did, your responsibilities, the impact. And as I was mentioning, some of the metrics, cost savings, cost avoidance, how you grew your business. Anything like that, that sets you apart from somebody else, that can tell you were successful in that role. You can do up to 50. You don’t have to. So whatever you want to focus on, but make sure it covers everything that you identify with and what you can bring to the table.
Jean Chatzky: (15:10)
Okay. When we’re talking about recommendations, how many do you need? How many do you want? What sorts should you have?
Allison Nunes: (15:19)
So the recommendation section on your profile, it’ll show what you’ve given and what you’ve received. And I think one thing people need to get past is that it’s okay to ask for a recommendation. Ask for a colleague that you worked for, a customer that you’ve worked with, a vendor potentially. Anyone that can validate your experience and can vouch for your success. It’s okay to ask for a recommendation. Also, LinkedIn really walks you through the process. It’s a few simple steps and also when you’re asked to give a recommendation for someone, don’t get overwhelmed by it. It’s not the days of writing a recommendation letter, you know, that has to be pages long or something. When I write a rec recommendation for somebody, two, three sentences. It’s someone I’ve had the pleasure of working with. I talk a little bit about it, add it to their LinkedIn profile. It really goes a long way.
Jean Chatzky: (16:14)
All right, let’s get into what we should not be doing. When we’re looking at, I mean, you must have this experience, especially as you’re looking at people’s profiles, as you’re taking them through this workshop, where you look at, look at a page and you think, oh my God, not again. What makes you do that?
Allison Nunes: (16:32)
Bad photos. The photo thing I think is where people think it’s a place for their family or something like that, or something unprofessional. You want to be professional but you can also show some personality. And I also find typos in people’s profiles like crazy and I’m constantly saying can go back to it with another fresh pair of eyes. That’s the worst thing to have hypos. Tell your story, but be succinct about it. Not have too, too much information cause more isn’t better, but you just want to be focusing in on your skillset and everything that you’ve done, your experience and your accomplishments. So typos one of the worst things. Photos, very, very bad when it’s not professional and it doesn’t represent you.
Jean Chatzky: (17:20)
Does LinkedIn have any sort of spellcheck to help you out?
Allison Nunes: (17:23)
You know, it will highlight a little bit like in a word document. It will, but even if you need to ask a friend for a fresh pair of eyes, cause sometimes I know you’re staring at something and you can’t see it because you’re looking at it for so long, I really recommend it. I go into my profile all the time, make edits. It should be dynamic. You should be updating your skills and projects and adding awards, adding photos, videos, any sort of rich media to make it more visually interesting. It’s very easy to edit. I tell people don’t get overwhelmed. Take 10, 15 minutes at a time, work through it and then you’ll find that it’s easy and you’re proud of it and that’s where we want you to be. Also, one other thing I wanted to add was volunteer experience is really important. We find that hiring managers value volunteer experience almost equally as professional work experience. So make sure that you include anything you’re doing in that area.
Jean Chatzky: (18:21)
Well I think that’s going to be really important right now. I mean, if you find yourself out of work and there is absolutely no shame in being out of work, particularly right now, what’s the best way to deal with that on your LinkedIn profile?
Allison Nunes: (18:36)
It’s up to the person whether they outwardly say I’m out of work and looking and also that summary section should provide that person viewing your profile, a sense of who you are, what you’re looking for. And if you’re out of work, ask for help and help others. That’s what we’re here for. And really leverage your network because this is the time where your network is there to help you.
Jean Chatzky: (19:05)
I mean, I’ve seen that on a number of profiles, particularly students right out of school. I just graduated and I’m looking for my first job opportunity. Do you advise that somebody out of work change their summary to say, I am looking for my next opportunity?
Allison Nunes: (19:23)
You know what, some recruiters, I’ve interviewed with some recruiters where some will get that just by looking at when your last professional experience ended and they can see that you’re out of work or there’s nothing current in the current time. And I think it’s however you want to embrace it and however you feel good about putting it out there. I don’t think there’s anything wrong with it. I think you could mention, you know, people kind of position it also is looking at their next adventure and this is what they can bring to the table. When you really focus on your skillset and the impact you can make early on, it gives that hiring person confidence that boy, you know, this is someone of value and I want them in my organization.
Jean Chatzky: (20:08)
Let’s talk a little bit about building up and leveraging your LinkedIn network. I mean, I think we’ve all had that experience where there’s somebody that we really want to link in with and we’re thinking they’re never going to accept me. You know why? When I click here, this is just, I’m putting myself out there, like checking out the LinkedIn of somebody that you’ve used to date, you can’t do it because you know that they know that you’ve been on their page.
Allison Nunes: (20:35)
Yeah, I would say for that you can always follow someone versus connect with them. So that’s something that you can do. If it is someone in the example that you just mentioned. Like for instance, I’m not connected to LinkedIn’s, CEO in my network, but I follow him so I can see all of his activity in the feed and everything he’s doing. I don’t need to be connected in my network to see that. But what I do tell people about leveraging your network, you should have a strategy behind it. And for the average person, I would say it’s really about quality versus quantity. Doesn’t mean you have to accept every invitation that comes your way. I just want you to think of your network as your inner circle. You know, your people that you could lean on and support and also be protective of. So you also don’t want to just let anyone in your network. When you do, they get access to you, your information and your network, depending on your privacy settings. But now more than ever, it’s so important to be connected and see who needs help, who can help you. You are four times more likely to get a job by someone referring you to a company they may already work for. So very, very important to take stock in your network and reach out. And your network should be coworkers, mentors, friends, family, business associates, industry colleagues, alumni from your school or university. So I’m always telling people to stay in touch and nurture your network because you never know when you need some help. And now is really an example of that time. You know, supporting your network is also being active in the feed so that your network curates your feed of what you’re seeing in your news feed. My feed is different than your feed. Depending on companies you follow, influencers you follow and what your network’s doing. So when your network is posting, you know, make sure you engage, you like something, you comment on something, you could even reshare a post of someone and that is really keeping you visible, which is really important in this time to be connected online. And then also it helps out that person in your network get more visibility from then your second connection. So that first, second, third connection group gets more access.
Jean Chatzky: (22:51)
I also think right now is a time when we all have people in our past that we feel bad about the fact that we’ve lost touch with them. It’s okay right now to just reach out just because. You know there is no reason to have a reason. I can’t tell you how many old friends I have heard from in the past month or so and I’m happy to hear from every single one.
Allison Nunes: (23:17)
Yes, and I think some people have a practice often that they will take five people in their LinkedIn network, reach out to them every week, but five different people each week. And that way they’re in constant communication with their network. Whether it’s just, hey, how are you doing? Or if they got a new job, congratulations. Any opportunity to stay in touch. And I think that goes a long way in this environment.
Jean Chatzky: (23:43)
Absolutely. Well, this has been really helpful. I think our listeners are gonna get a ton out of this show. I will post all the resources in the show notes so that they just have to click to figure it out. We’ll make it as easy as possible. Allison Nunes, thanks for being part of our community. We appreciate it.
Allison Nunes: (24:02)
Thanks so much, Jean. Appreciate it.
Jean Chatzky: (24:04)
And we will be right back with Kathryn and your mailbag.
Jean Chatzky: (24:15)
HerMoney.com’s Kathryn Tuggle joins me now for our mailbag. How are you doing in captivity my friend?
Kathryn Tuggle: (24:22)
Doing great. Doing great. I’m now inspired to spend some of this captive time updating my LinkedIn profile.
Jean Chatzky: (24:29)
Don’t you dare.
Kathryn Tuggle: (24:29)
Not for the purposes of finding a new job, but I totally think that my summary is in third person. I totally think that I’m like, Kathryn’s Tuggle, blabity, blabity blah. And now I’m feeling bad about it.
Jean Chatzky: (24:44)
Oh wow. You know, I haven’t done mine in years, but I will go back on and maybe take a look at some point. I like LinkedIn, but I do think there’s this weird thing where, if you go on somebody’s page, they know you’ve been on their page, so you can’t really lurk on LinkedIn.
Kathryn Tuggle: (25:02)
So secret, maybe not really a secret, but you can be anonymous. The only trick is that when you elect to be anonymous, you can’t see anybody who’s been searching for you.
Jean Chatzky: (25:15)
Kathryn Tuggle: (25:16)
So if you want to be able to still see who’s looked at your profile, you can’t be anonymous unless you pay for their LinkedIn premium.
Jean Chatzky: (25:24)
Gotcha. I have a friend who shall remain nameless, who wanted to check out what his ex-wife was doing. Like it had just been years and years and years since their divorce, and he wasn’t sure what was going on in her life, professional or otherwise. They’re not friends on Facebook and so you know, he actually borrowed somebody else’s LinkedIn to go over and take a look.
Kathryn Tuggle: (25:48)
Jean Chatzky: (25:50)
Kathryn Tuggle: (25:50)
That’s like, you know, some hardcore like stalking level three territory here.
Jean Chatzky: (25:57)
A little stocky, but also just like he didn’t want her to know that. I actually think his motivations were kind of good. Maybe. I mean I think he knew that she had lost a parent and it made him think like, oh, what’s up with her.
Kathryn Tuggle: (26:13)
Jean Chatzky: (26:15)
Could have written a condolence note.
Kathryn Tuggle: (26:19)
Well, you know, options.
Jean Chatzky: (26:19)
Options, options. Anyway, I know we’ve got a bunch of questions so let’s get into it.
Kathryn Tuggle: (26:26)
We do. Yeah. I actually want to kick off our mailbag with a bit of joy. One of our loyal listeners, Teresa Baldwin, wrote in to share some amazing news. She said hi Jean and HerMoney team. I just wanted to thank you for all your advice and knowledge over the years. Tomorrow I’ll be debt free for first time in years. I have enjoyed your books and podcasts for a long time and just wanted to say that I couldn’t have done it without you. Thank you so much.
Jean Chatzky: (26:52)
Oh my gosh, Theresa. That is incredible. I am so excited for you. So proud of you. We are. We’re not the Dave Ramsey show so we don’t have the debt free scream, but I’m screaming for you from the inside. I think that’s wonderful.
Kathryn Tuggle: (27:08)
Absolutely. We are celebrating with you and for anybody else who’s listening, if you have good news to share, by all means send it to email@example.com along along with your question. We love to hear from everybody no matter what stage you’re in. But our first question comes to us from Jackie. She says, hi HerMoney team. I currently have a little over $20,000 sitting in a savings account in our bank that is our emergency fund. Prior to the COVID-induced recession, I was planning on moving 15,000 of it to an online high-yield savings account based on what I’ve heard on your show. However, now I’m a little skiddish. I was fired from an 18 year-long job in 2018 and we had to dip into our savings in order to make it through until I can find a job, which I did after six months on unemployment. Anyway, I just don’t know in the current economic climate if it’s a good idea to move the money. What if one of us does get furloughed or laid off and we need the cash? I guess what I’m looking for here is just reassurance that this is still a good thing to do. Here are financial details. My husband is 50 and I am 54 and we’re both working. He works for the state and I’m a librarian at a state college, so our jobs should be pretty secure. We have very little debt, no credit card debt, one car loan at 3% interest. Our home mortgage with about 60,000 left pay at 3.75%, a HELOC with about 12,000 at 4%. We both have state pensions and contribute to the government equivalent of a 401k. I have a traditional IRA at $200,000 and a Roth IRA at $5,000. Our oldest daughter is going to college on scholarship and we have a small $25,000 529 for our youngest who starts college in the fall. Thank you so much.
Jean Chatzky: (28:52)
So Jackie, thank you so much for sending all the detail. It really helps for anybody who’s writing to us about your personal financial situation. We like the details because the details really give me a sense of where you’re coming from. I think it’s fine to still move the $15,000 to an online high yield savings account. The reason is it’s not an investment, it’s just a savings account, a bank savings account with FDIC protection insurance where you’re going to earn more interest than you’re earning from your brick and mortar bank that is probably paying you a fraction of a 10th of 1% because interest rates are so low right now. The hitch with the online savings accounts is that, should you need the money, you have to transfer it back from your online account into your brick and mortar account to get access to it in many, many cases. Not in every case. But in many, many cases. These accounts often don’t come with things like ATM cards. But I’ve found because I have some of these savings accounts that it’s really easy. It doesn’t take more than a few days. And so I think that as long as you preserve a little bit of cash, and it sounds like you’re going to preserve the 5,000 in cash at your brick and mortar bank on the corner with the ATM card, it’s fine to move the rest. Grab a little additional interest and you know that you’re getting close to breaking even on your money after taxes and inflation. There are many, many banks that have accounts like this. We keep a list of firstname.lastname@example.org. Personally, I have an account with Citizens and I have an account with Capital One. They’re both paying about 1.5 or 1.6% right now. You might be able to do even a little better than that, but I wouldn’t worry at all about making this move. And I also think you’ve set yourself, you didn’t ask me this question, but I also think that you have set yourself up really, really well for the future and you are so fortunate that you have state pensions in addition to your IRAs and 457 plans. So good going on all of that and congratulations on your kids in college and thanks for writing.
Kathryn Tuggle: (31:23)
Yeah, absolutely. I think Jackie, may be under the impression that there’s like a fee to take money out of a high yield savings account or something like that, but there’s not. It’s just a savings account, right?
Jean Chatzky: (31:33)
It’s just a savings account. Most of them that I’ve seen have absolutely no minimums and if you are eligible to join a credit union, you may even find that the interest rate is a little bit higher. I did a webinar yesterday for a credit union called BCU, which is in the midwest and they’ve got a rainy day savings account that pays 2%. They’ve got a maximum balance requirement on that one, not a minimum. You can only keep up to $25,000 in there, but that’s a terrific rate of interest. So I would check that out as well.
Kathryn Tuggle: (32:10)
Definitely. Our next note is coming to us from E.P. in NYC. She writes hi Jean, Kathryn and the HerMoney team. Thank you so much for the rich, accessible, fun, valuable resource that is your podcast. I love it. Here’s my situation in question. I’m 55 years old.
Jean Chatzky: (32:28)
Wait. Before you get to her situation and question, can we just put that on a tee shirt? I mean that’s just rich, accessible, fun, valuable resource. Like I want that in big, big type. Thank you for that E.P.
Kathryn Tuggle: (32:40)
Yeah, we should do coronavirus masks with that too.
Jean Chatzky: (32:44)
Rich, accessible, fun, valuable resource.
Kathryn Tuggle: (32:47)
But don’t touch me.
Jean Chatzky: (32:50)
Kathryn Tuggle: (32:51)
She says, here’s my situation in question. I’m 55 years old and five years ago started attending Under-earners Anonymous meetings. I identified, in myself, behaviors and tendencies that fit the list of symptoms of chronic under-earners and steady application of the tools of the program have been transformative. Since then, I’ve increased my earnings significantly, but for me it’s late in the game. I took care of ill family members for almost 30 years during which time I didn’t earn market value or save for my future. Currently I have less than a hundred thousand dollars in retirement savings. I’m doing what I can to make up for lost time and grow my savings. But realistically I don’t see socking away anything near what most projections say I’ll need to retire, well, ever. This is scary, but it’s reality and I know I’m not alone. I speak with other women my age who because of various life circumstances have not saved for retirement. My question for HerMoney is, how are older women creating alliances and support structures that replace some of the need for money in our later years? What resources are out there for us so we can educate ourselves and do as much advanced planning as possible? Thank you again for your tremendous contribution to the wellness of women of all ages.
Jean Chatzky: (34:04)
So I learned something from this letter actually. I wrote about under-earning a good deal in Women With Money. Because she’s right, it is a big problem and you can recognize yourself as an under-earner if you never ask for more money, if you have trouble raising your rates, if you’re an entrepreneur, if you don’t feel like you deserve to earn more, even if you’ve got skills that keep up with higher salaries. And there’s a whole list. It’s a very, very common syndrome. What I didn’t know was that there was a group. But I am absolutely going to reach out to that group and see if we can get somebody from it to come on the podcast and talk about this because I do think it’s a very, very interesting problem and that we should discuss it even more. So a couple of things for you, E.P. specifically. I get looking at your numbers that you feel like you are behind when it comes to saving for retirement. I think you are a little behind when it comes to saving for retirement. But I also think that you’re relatively young and I say that because I am also 55 years old and I am planning on working a good, don’t tell my husband, 15 more years, maybe 10 is a minimum. I like what I do and I want to continue to work even if I do it on a part-time basis down the road. And I tell you that because if you feel the same way, then I think what you miss in this equation is that for every additional year that you continue to work, you really do put yourself way ahead when it comes to retirement because that is another year that your money doesn’t have to come out of your retirement accounts, that it continues to grow, that you can continue to contribute. So I would encourage you to look at a longer time horizon for your working life. I would also say, think about, now that you no longer have those responsibilities on your plate as far as care-taking is concerned, think about whether or not you can shrink your lifestyle a little bit right now in order to save a little bit more. It doesn’t have to be drastic, but anything that you can do that will enable you to put a little bit more away on a regular basis, is helpful. And then, I love the question about older women creating alliances. I was on Twitter yesterday and I was noticing that it was the 42nd anniversary of the season finale of Maude. Maude of course started Bea Arthur who went on to star in the Golden Girls with Ruth McClanahan, who was also on Maude, and Betty White, and it got me thinking about the fact that because so many women outlive men, I think we’re all going to be the Golden Girls at some point in our lives. And I think that’s actually fine. I think getting together with friends and thinking about what kind of a community could we forge together? How could we share our expenses for housing? How could we take care of each other as we get older and find ourselves alone? I think that’s what life is going to look like as we get older and as we age and I can think of nothing I’d like more than growing old in a house with my girlfriends, if I were to find myself on my own. So I would point you to AARP. They have some great resources when it comes to aging, particularly as women get older. And I would also say check out the MIT Age Lab. They’ve done a ton of research about what retirement is going to look like in the future. And I think you’ll find a lot that’s interesting there. And if you wouldn’t mind, because you asked the under earning question, dropping us another note with your actual address. I will, the next time I’m allowed to go to the post office, I will drop a copy of Women With Money into the mail for you cause it just came out in paperback.
Kathryn Tuggle: (38:23)
That’s amazing. And you know, honestly I find myself thinking about a Golden Girls scenario more often now than ever because, as women have been empowered have choice more over the decades of not marrying and not having children, I do think that we are in the coming decades going to see more and more of the Golden Girls type situations of women who are best friends, who elect to be roommates, who care for each other into their golden years. And I think that’s beautiful.
Jean Chatzky: (38:55)
I do too. I mean I told you the funny story about my friend Paige, right?
Kathryn Tuggle: (38:59)
I don’t know. I don’t think so.
Jean Chatzky: (39:01)
Paige at one point, I think I was thanking her. She tends to be kind of the organizer when it comes to getting us together, my girlfriends. And I think I was thanking her for doing that at one point and she said, we have to take care of our girlfriends because eventually all the men are going to die. And I have always just remembered that. I mean it’s terrible, but it’s true.
Kathryn Tuggle: (39:27)
She’s not wrong.
Jean Chatzky: (39:28)
If you look at the statistics, it is true. And I just think you know, I mean my girlfriends and our zoom drinks, I’ve got another set tonight. I mean it’s gotten me through Coronavirus. I think it can probably get me through old age.
Kathryn Tuggle: (39:44)
Absolutely. Very well said. All right. Our last note comes to us from Regina in Diamond Head, Mississippi, which I have been to, mind you. It is not too far from where my best friend and college roommate lives down in Gulf Port, Mississippi. So she says, I’m considering buying a historic home that will require some fix up. The home was built in 1915 but it is in sound shape. I’m considering taking money out of my thrift savings account, about $75,000, to buy the home outright. I have two more years to work full time before retiring, so I’ll be saving money. In the meantime, I thought of renting out the historic home for a couple of years until I’m ready to move. The sellers have a second mortgage on the home, so they’re extremely motivated to sell. Should this move be made in your opinion? I’d rather have real estate as an investment instead of watching my retirement money go down the drain.
Jean Chatzky: (40:34)
Okay, Regina, don’t you dare. Don’t you dare. Here’s why. First of all, the money in your thrift savings account is not worth what it was worth several months ago. And I know that that’s why you’re considering taking the money out of the account in order to buy that house. Don’t do it because if you’ve got a couple of years to work, that money very likely will start to come back. And then you leave it there as it continues to come back for the longterm and you take it out over time. The other reason that you don’t want to do that right now is that mortgage rates are so low. What if you just bought the house, borrowed a little bit to buy the house and then covered the mortgage by renting it out until you were ready to move into it? I would so much rather see you do that. So you said you’ve got a very motivated seller. Make the deal that you possibly can. But if this were me, I would not pull money out of the TSP to do this. Is that too harsh? I’m usually not that harsh, Kathryn.
Kathryn Tuggle: (41:42)
No, I think she wants an honest opinion. Go for it.
Jean Chatzky: (41:47)
All right. I mean that’s just what I think. I think we don’t pull money out of our retirement accounts unless we absolutely have to. And you don’t absolutely have to. You have other options. You have a job which will likely qualify you to borrow money at a really, really inexpensive rate. So I just ran some very quick numbers and I ran them not knowing what real estate taxes or insurance are going to look like in this part of the country. But if you were to put 20% down on this place, put $15,000 down on the $75,000 home. Borrow the other $60,000. Finance it over 30 years and real estate taxes were $3,000 a year with insurance running about $1,500 a year. I’m just guessing on that. You’re looking at a total monthly payment of $644. So Kathryn, you said you know this area of the country, does it sound like you could rent a house out and cover that.
Kathryn Tuggle: (42:51)
A hundred percent. Yeah, I mean, it’s been a few years since I was in Alabama, but my rent was $600 a month when I was there.
Jean Chatzky: (42:58)
Right. And this is a house and it sounds like it’s a charming house. I mean you may have to put a little bit of paint into it and things like that. But I would not pull money out of my TSP in order to do that. If you want it and you think you want to live in it in the future, and this is a once in a lifetime opportunity to get it and you love it, then go ahead and buy it because rates are low. But rent it out, cover your costs until you’re ready to make the move and take a mortgage.
Kathryn Tuggle: (43:24)
Yeah, I totally agree. It sounds great.
Jean Chatzky: (43:26)
Okay. That’s my 2 cents. Hope that that’s okay with you Regina, if it’s not, I’m sorry, but that’s my opinion. In today’s Thrive, oh, and Kathryn, thank you.
Kathryn Tuggle: (43:36)
You are so welcome.
Jean Chatzky: (43:38)
In today’s thrive, I want to talk a little bit about financial anxiety. 23% of millennials say they are often physically ill because of their financial anxiety. This is some new research from Northwestern Mutual. More than half are worried about losing their jobs. A quarter say that all of this anxiety impacts their relationship with their partner. But of course knowing that you’re not alone with all this stress, it just isn’t enough. There are strategies out there that you can employ to help you curb these negative feelings. And I wanted to just walk you through a few of our favorites that we recently posted on HerMoney.com. First build an emergency fund. Never has this seemed or been more important. You want to work your way up until you have three to six months worth of cash reserves. And you’ve got to do it even if you have to by saving $20 a week or less. You want to spend less than you make. To avoid the stress of never having enough money and going into debt, keeping your bills just paid, create a simple budget and then do your best to stick to it. It can be difficult to resist overspending in our consumerist society, but stay focused on how a stress-free life will be much more satisfying than that cute pair of shoes or whatever else you want that isn’t really in the budget. Become a saver. Even after you’ve built up that emergency cushion, makes saving a way of life. Work to save 10 to 15% of your income. In other words, make it a mandatory bill that you must always pay and pay it first. Stay informed. Don’t delay opening your bills. Check your bank account balances frequently to keep track of how much you’re spending, how much you’re saving, and whether you need to tweak your monthly budget. And finally, do whatever you have to do to get rid of the debt that you’re carrying, especially credit card debt. It is that high interest rate debt that is the likely source of financial stress. The auto loan that you budgeted for, the mortgage that you budgeted for, you can handle those. But commit to paying off the credit card debt as quickly as you can. And do it by paying more than the minimum wherever possible.
Jean Chatzky: (46:04)
Thanks so much for joining me today on HerMoney. Thank you to Allison Nunes for joining us as well and sharing her insight into standing out on LinkedIn. If you like what you hear, please subscribe to our show at Apple Podcasts. Leave us a review. We love hearing what you think. We’d like to thank our sponsor Fidelity. Our music is provided by Video Helper and our show comes to you through Megaphone. Thanks so much for joining us and we’ll talk soon.