While your folks would never intentionally try to steer you down the wrong path, when it comes to personal finance, their advice may be a little outdated. A lot has changed since they were your age — 1989’s median home price was just over $160,000 in today’s dollars, but it now stands at more than $540,000. College tuition has gone up by more than 1,375% since 1978, and student loan debt has quadrupled since 2005, burying many Americans under a mountain they feel they’ll never be able to earn themselves out from under. Couple that with the fact that millennials have lower incomes and fewer assets than older generations, and it’s clear that the last three decades have completely reshaped the financial lives and outlooks of young Americans.
So why are so many people still talking about them the same way? Exactly, writes Julia Carpenter writes in the Wall Street Journal (in a terrific special section about millennials and money) who notes that the messaging around a few of these issues need to change. Take student debt, for example — it is, in fact, possible to invest too much in yourself — so much that your debt will dictate your life and decisions, rendering you unable to pursue your passions and other life goals. (If you’re looking for a formula to help you determine the level of student debt “safety,” don’t take out more in loans than you expect to earn your first year out of school.) Another shift we need to make is the assumption around the need to purchase a home — real estate may not always be a good investment, and it isn’t essential to realizing the American dream. But not all the old rules are dead. Being frugal and spending less than you earn is still the best way to ensure a stress-free financial future, and saving for retirement should always sit at the top of your to-do list. Snag the employer match on your 401(k), sock all the money you can into your HSA, and get on a budget. Because at the end of the day, mom and dad were right about this.
Dis-Owning Is The New Black
And while we’re talking about things younger generations are doing differently — to the benefit of their bottom lines, let’s talk about renting clothing. HerMoney staffers (including me) have been patronizing Rent The Runway unlimited on and off, practically since it started. But the line out the door each morning to the clothing return box that has taken up space in the lobby of our WeWork provides ongoing confirmation that it’s a thing. Yes, it’s more women than men these days (our search for clothing rental companies for men other than, say, formal wear, took us to TheMrCollection but little else.) But as Reuter’s notes, Bloomie’s, Urban Outfitters (with sister brands Anthro and Free People), Rebecca Taylor, Banana Republic and even H&M have gotten in on the game. But does paying a subscription fee make sense for you? Take a look at the past few months of your clothing spend. If you routinely spend $150 – $200 a month or more on clothes, you’re a good candidate. Then ask yourself why you buy. If you’re buying because you want to have something new, different or special, or because you wore that dress the last time, or because you’re pretty sure that outfit has already been seen on Insta, you’re a very good candidate. I’m not judging — I apply the same filters to myself. Besides, we’re always a judgement-free zone.
I’ll Take The Hoodie For $1,000, Alex
If a child in your life is thinking about where they’ll head to college, then chances are you’re already hearing a lot about college application season, which often means campus visits. While these visits can be exhilarating for the students, they’re often fraught with problems of the emotional and financial variety for beleaguered parents. By the time you add up the cost of things like gas, hotels, meals and airfare, the visit can easily top $1,000, and may be much more if additional family members want to attend, or if the school is particularly far away. Fortunately, there are ways to keep costs down, according to a story in this week’s New York Times. Many counselors advise starting near home, and looking at schools that are within a few hours’ drive, so an overnight stay isn’t necessary. Some schools also offer digital or “virtual” tours via their website, which your child can take first, before you get on the road. If your child loves what they see, then you can have a bigger conversation about packing bags. Also, if your child is from an underrepresented racial or socioeconomic group, there’s a chance their dream school may offer a free “fly in” visit — give the admissions office a call to ask. Lastly, avoid the campus bookstore. No, really. Purchasing college swag can be very tempting and incredibly costly. Rather than seeing collegiate gear from every school as simply a “souvenir,” make a deal with your child that you’ll spring for clothing once they get their letter of admission… because no one wants to walk around with the name of the school that rejected them emblazoned on their chest, no matter how fun the visit was.
Finding Your Place
Finally, do you work in an open floor plan office? Where do you retreat for moments of solace, private calls, or just a breather? Because even though we may dearly dearly love our colleagues, we don’t necessarily want to be face-to-face with them for 40 hours a week, which is exactly what open offices have forced us to do. And in turn, we’re increasingly escaping to the only place we have left to find a moment of zen — the bathroom. Yup, writes Cait Munro in Refinery29. All-glass conference rooms won’t work, and in the absence of having our own enclosed suites, the water closet is the next best thing — and often it’s the only option for finding real privacy.
And even if stall-lurking isn’t a part of your workweek, chances are you’ve gone to some lengths for a spot of privacy, perhaps hiking up (or down) a few floors in search of a quieter spot to do your business, or darting out for a respite to a public restroom that somehow seems more private without the smiling faces of colleagues lining the walls… If you’ve at all felt awkward or weird about your need to escape, feel free to breathe a sigh of relief, because psychologists say it’s completely normal. And, there’s good news on the horizon for all of us craving a little more solitude during our 9-5 — more companies are taking steps to install gender-neutral restrooms, which are single-stall and completely enclosed, with floor to ceiling doors. Doors that can lock us in for a nice deep breath, a good cry, meme sharing with a friend, teeth-brushing, or anything else we’d like to do far from the prying eyes of Karen in accounting.
Have a great week,