Slowly Sipping Coffee

Personal Finance Win at Work!

I’ve made it no secret that I like talking finance at work and my co-workers know that. I try hard to not be a pest about it and pay attention to the conversation dynamic, so that when co-workers get the 1000 yard stare, I reel it back in. This constant talk of finance has finally started to get some good results. For instance, I’ve had a co-worker ask me to figure out whether or not paying PMI was worth it. We worked it up in ~10 minutes on my whiteboard and figured out that she’d be paying ~$13k over 4 yrs to PMI versus putting that same amount aside towards a down payment. She’s still saving for the 20% mortgage down payment instead of pulling the trigger on buying a home a year ago.

Other wins have been handing out 5 copies of the millionaire next door to younger colleagues, and getting good feedback on it after they’ve finished reading it. I’ve also been compiling an ever growing word document (for download below) with links to different blogs, investing sources, investing definitions, savings art links, etc… I keep the master and delete and add links as needed to cater to whatever question I get at the time. I’ve sent it out to my team, one of my supervisors, and more. It’s gotten positive feedback each time, so I just keep growing and editing it.

Yesterday came the biggest win of all so far! I mentor a younger person at work, and while we do talk a lot about work related things, one of the other things I keep talking about is investing now to give yourself choices later in life. I hadn’t felt too much success at any of this talk making any impression on my mentee, so I’d backed off on it and only offered advice when asked. I was super excited when I was recently asked about 401k elections and starting a taxable account outside of their 401k.

What Should I do With my 401k?

It started with a conversation about where my mentee, let’s call him/her Pat, asked about the taxable accounts and how to get them set up. Pat had been looking at their 401k and wondering whether it was diversified enough, or if they needed to reallocate balances, change distribution into upcoming contributions, and whether they should up their 401k contribution. Imagine the kid in class that excitedly puts his/her hand up when the teacher asks a question, “Oh, me, me! Pick me! I know this one!!” That was me, but don’t worry I kept a poker face so I wouldn’t scare them off.

This was me....

This was me….                       illustration edited from laura.moncur.org

 

I started with explaining how to figure out the percentage to contribute so they would max out their 2018 401k contribution. Then I went on to explain that since the company contribution doesn’t count towards the overall max, they could max the account and get the 7% match from the company. So the first order of business was upping the current 401k contribution from ~7% to ~15% to be able to max out the 2018 limits. We also did a double check to make sure this wouldn’t put them in a crunch “losing” the extra pay each check, but I was impressed when Pat’s reply was, “Whatever, I’ll figure out how to make it work with my new bring home pay.” Nice!

Am I Diversified Enough?

After doing that, we started looking at the different elections their account had been going into. It was all going towards a conservative balanced fund with about 50% stocks, 33% bonds and remainder in cash and other diversified equities. Not a bad fund, but not what a 20 something should be using if they want more growth in their account. This led to a 30 minute discussion about growth, time in the market, and the strategy of being more aggressive when you’re younger because you’ve got about 35+ years before you can touch this money.

Time to relax and let the market do it's thing. You've got time.

Time to relax and let the market do it’s thing. You’ve got time.

We reviewed some historical charts showing the different dips and crashes and rebounds from the 80’s 90’s, 2002, 2008, and how it would have played out if you had been in equities the whole time. I also pointed out how to read the investment profile sheet for each fund. We looked at most of them and went over the fees, returns, volatility, main companies/sectors that fund is invested in, etc… I pointed out why you should pay attention to lower expense ratio and mutual fund trading fees, and it seemed to click pretty easily. By the end of that exercise, Pat had picked out 2-3 funds that they were comfortable with investing in.

Investing Strategy

Don’t worry, all of this data was quickly followed up with my take on investing.

It doesn’t matter what the charts and graphs say is the “right” strategy, because the best investment strategy for you is the one that will let you sleep at night.

If this means you want all of your money in bonds because you’re terrified of the stock market, it won’t be the most profitable investment style, but it beats not investing at all. If you want 100% equities, that works too. Whatever other split of any of those leaves you comfortable at night is the best investment strategy for you.

After those talks we decided that we would leave the previous chunk of money in the diversified portfolio because that’s what Pat wanted to do. We changed the future allocations to various other equities that Pat was comfortable with investing in that had more growth opportunity, especially since the original chunk was left in place with the “safer” diversified fund. We sold off all of Pat’s company stock and used that to build a good chunk into some other higher growth, lower fee funds, mainly because the company stock is the worst performer of all of our choices.

What a pisser indeed...

What a pisser indeed…

After getting all of Pat’s internal investments set up how they wanted, I also spent time showing Pat how to navigate around our investment site until they were comfortable with being able to do anything they wanted on their own.

Taxable Account?

Then we started looking setting up a taxable account. I mentioned Charles Schwab as the best bet, because I read a post by Physician on Fire that explained Schwab would let you put in any amount and you don’t need to save up to $5k or whatever threshold Vanguard and other brokerage houses have. We also found the right stock symbols for the funds Pat liked so when they got it set up, they knew what to contribute to. I walked Pat through the basics of how to set that account up when they have the appropriate info needed and I am confident it will happen soon.

Make your own Retirement Baby and watch it grow bigger each day!

Make your own Retirement Baby and watch it grow bigger each day!

Personal finance win!  

Even though being a finance geek around the office sometimes shuts down conversations, I’ve tried my best to avoid those situations. After a few years of talking about things like investments, expense ratios, saving to have freedom of choice later in life, and more it has finally started paying out. I feel like it was a real win for me getting Pat set up on a better investment track and feeling way more confident in their own abilities to DIY investments.

Have you had any personal finance wins with any friends, peers, or colleagues lately? Any other advice on how to talk finance with people that may not be interested? Does persistence pay off or should I keep on my “less but better” approach when talking finance and just speak when spoken to?

 

Below is the Word document that I’ve compiled over the years. It doesn’t get sent out to my colleagues in this form, but here is the “Master” containing everything if you’re interested in reviewing it. It’s pretty basic, but let me know what you think. I haven’t included every blog I read on the blog list, mainly ones that I thought a specific person(s) at work may be interested in from the gaggle I try to read each week. Apologies if yours wasn’t listed specifically. 🙂

Finance Links

34 thoughts on “Personal Finance Win at Work!

  1. J

    I had a similar success recently when I introduced a work peer to the concept of Financial Independence. Not only was he receptive, but after a few weeks, he emailed me asking for links to resources that could help him get and stay motivated. I was ecstatic to find out that he’s now steadily following the blogs, FB Group and podcasts that I’ve recommended and also making significant changes in his finances. It feels incredible to know that just maybe I played a small role in redirecting the financial future of his family 🙂

    1. Mr SSC Post author

      That’s awesome! It’s nice when people are more receptive to listening or even talking about money and finances, much less FI. Good job and keep it up, you never know when someone will take it to heart.

  2. MrWow

    This is awesome… we’ve started this as well. It’s a touchy subject, but I’ve found that people open up if you talk rewards points and open that door. Who doesn’t like to travel for free? Then they start asking more and more. And it eventually morphs into something else. How else have you opened to conversation?

    As for the books, at the end of every internship that the Mrs manages, she gives them gifts. Part of that is now “The Simple Path to Wealth”. We’ll see if it resonates, but it’s a start. Mrs has a great story about that hopefully she’ll share.

    1. Mr SSC Post author

      Yeah it can be pretty touchy. Usually I start when asked about something, or hear other people talking about stocks, money, retirement, etc… Over the years of smaller conversations like that, I’ve gotten a LOT more people coming to me with questions and don’t have to seek out those conversations anymore. 🙂 My supervisor also helps in this regard. He’s gotten burned by stock picking and is a big index investor now. He always pushes the couch potato portfolio, which is why the Word Doc I created has so much mention of it. I jump in during these talks and add my 2 sense which is “the why” of why investing younger and sooner than later is better than waiting. I also add more meat to the conversation, but that’s another way I’ve started.

      Mostly, I get into those conversations organically when I hear co-workers discussing anything related to finance, credit card debt, gym memberships, whatever. I’m weaselly like that, lol.

      That’s a good point about the book, maybe I’ll even start handing out some of the automatic millionaire series if it looks like a good easy one. At least I have a copy I can review. My point with the millionaire next door is that it reflects my big theme which is “don’t inflate your lifestyle just because you’re getting a good paycheck now”. That and the fact that you don’t have to look like a baller to have wealth. 🙂

  3. Revanche @ A Gai Shan Life

    I’m higher placed than most of my coworkers so I can’t talk money with any of them, other than teaching them negotiation and negotiating for them, because I think it would come off badly. You never want your boss telling you how to invest!

    So instead I am working on a plan to convince my cousins that we all want in on the early retirement train. I have planted the seed and am going to work on them slowly over Thanksgiving 🙂

    1. Mr SSC Post author

      Good luck with getting your cousins on board! Fingers crossed for you. My boss tries telling all of us how to invest, over and over again. He’s gotten burned at stock picking, think telecommunications stocks in the 80’s right before they all tanked, so he is a huge proponent of “just invest in index funds!” At that level of “how to invest” I’m fine with it, but I also supplement that with, don’t forget about target date funds if you don’t want to set up a couch potato portfolio (another big recommendation of his), or other options for those that aren’t really wanting to go all equities. It’s a dicey line with him to walk in recommending stuff to us all, but he means well, so I don’t take offense.

  4. Freedom40Plan

    That’s great that you’re able to share this information with people in your “real” life. I’ve always been very hesitant to get into money conversations with co-workers or friends. Online, writing a blog…that’s another story!

    1. Mr SSC Post author

      I had been pretty timid about it at first, but as I found more and more personal finance/investing/saving conversations I could join or was a part of from the beginning I got more bold about it. Now I get more people coming to me with questions about things rather than me trying to steer conversations. Especially when they learned my backstory of the student loans, credit card debt, and poor spending habits prior to learning about “good personal finance” habits.

  5. Mrs.Wow

    Being that I supervise and mentor a lot of interns, I am constantly trying to unload little nuggets of information to get them off on the right financial path as quickly as possible. A little don’t inflate your lifestyle here and do start throwing money in a 401k there can go a long way with these students who are about to embark on a profession where they will be making more money than they probably ever have before. But my biggest frugal win came from my new employee. We had a meeting a few weeks before she started with me to discuss how we set up her 401k and other benefits she’d receive from my company. In the middle of the meeting she reached into her bag and pulled out the book she was reading… The Simple Path to Wealth. I already knew she was a keeper, but at that moment it solidified her worth. #financialwinningatitsfinest Keep up the great work Mr.SSC!

    1. Mr SSC Post author

      Yeah, having interns is a great pipeline to get to deliver some PF advice, and get them thinking about “60 yr old them”. My first intern was in a similar position but she already had the goal of getting rid of debt, and not inflating the lifestyle once she got a full time offer. She was a little easier to give some better guidance to, different blog and book recommendations and things like that.

      That’s awesome with your new employee, congrats! It’s nice having someone that’s easier to talk PF with than trying to convince them they should listen, lol. Good luck with your other interns and co-workers! I’ll have to update my books I hand out. I did the millionaire next door because it shows most millionaires don’t have inflated lifestyles or tastes. Maybe I’ll use the automatic millionaire since I have a free one I could hand out. 🙂 Simple path to wealth sounds like I need to check it out too. I’m severely deficient in ANY reading about PF, other than blogs and articles.

  6. dn

    “…one of the other things I keep talking about is investing now to give yourself choices later in life”

    This is the one of the most important things to impart into people. Most can’t fathom what could go wrong or why they need to save now and assume that things will continue to go well later on. For the new grads around me, I have to remind them that the company management can change, their jobs can change, their bosses can change, the economy can tank, the company’s prospect can change, their health can tank, something could happen to their wife/kid/whatever (and all of this is out of their control). By saving now, you are buying a degree protection against the vicissitude of life, which invariably will occur. And if they haven’t felt the short end of the stick on these things yet, they just haven’t lived long enough yet, because bad things happen to good people. And even if nothing bad happens, you have bought yourself the option of scaling back or opting out of work, later.

    I wish there were more people like you, when I was starting out work.

    1. Mr SSC Post author

      Thanks for the nice comment! I try to point out that it’s about giving yourself choices later because younger people seem to relate to that and want to have more freedom rather than relating to anything to do with retirement. They just don’t even grasp themselves at that age, and much like me at that age could care less. With Pat, I kept bringing up that maybe in 10-15 yrs or so an opportunity might come up to move to a non O&G state out west, or maybe running an animal care facility or something that’s more fulfilling than our current work. If the funds are in place and the lifestyle hasn’t inflated to the point that an O&G salary is the only thing that can keep it going, the flexibility could be there to make those moves, geographic or career wise.
      That’s not even getting into pointing out that while work is great now, a quick change to a new group/supervisor etc… and work could start to suck really quickly. Again, with saving now, you get choices for later and can be more in control of your future rather than be trapped by your current paycheck.

  7. Jason

    That is a total win. I fully admit I love doing this at work as well, but the best thing is when students ask for advice and they are thinking about their future. So many don’t. We even had a debate in my argumentation class about buying new cars vs. used ones. Most of my students still wanted the new car and some even said they should be able to buy it now (while they are going to school and accumulating debt) but a couple of them got the message. All it takes is one and is the reason I am still teaching after all these years.

    1. Mr SSC Post author

      I agree, it just takes one to make it worthwhile and want to continue “preaching” the good personal finance message. It’s like fishing, you can sit outside for 2 hrs and get nothing, and as soon as I’m ready to call it a day, I can catch one and have the renewed energy to want to sit another 2 hrs. I see it like that. Good luck on getting more students to get the message. 🙂

  8. Mr. PIE

    “The FIRE is spreading….”, as Jonathan from Choose FI says at the end of each podcast episode.

    Gotta feel good helping others, right!

    A colleague recently asked me about three (yep, 3!) separate topics:

    1. Travel hacking – I dutifully pointed him towards Travel Miles 101. I nearly pointed him to a nice article Mrs. PIE wrote on Travel hacking for Beginners but thought better not to….
    2. Fees on his mutual funds. He LOVED the article I sent him from Physician on Fire.
    3. Index funds we invest in. I happily ran through our taxable, tax-deferred choices with him on my office white-board and pointed him to the Morningstar web-site for more YTD, 1/5/10 year performance summaries, fund details etc. I think I blew his mind by rattling off the Vanguard and Fidelity fund symbols for nearly a dozen funds! He told me a week or so later that he sold a number of funds and bought into VTSAX. And he is just getting started with more changes to come.

    It felt really good to be able to do a few small things, which I am sure are not-so-small for a colleague who is wrestling with his finances and retirement savings situation – he is the same age as me.

    1. Mr SSC Post author

      It just takes a little spark to start the FIRE, right? 🙂 I really enjoy helping others out and it feels good it was finally received positively.

      Good job not sending him to your site. I included one of my blog posts to a colleague and it wasn’t long before he’d read most of the posts and was like, “Hey, you sound a lot like this coffee guy online…” Fortunately, he’s also on a FIRE path so he’s now my confidante at work and we discuss all sorts of FIRE/PF related topics.

      That’s awesome that you were able to help your colleague out! It’s amazing how some of the “simplest things” as we see it can be so life altering for others. I mean, maybe not life altering, but make a difference just the same. I know 5 years or more ago, I would’ve glazed over at talk of fees and expense ratios and even investing period. That’s great he took it to heart and was actionable with the info! Of course, him seeking you out helps with the mindset too.

      One of my other colleagues told me, “Well, I’ll cut down my 401k contributions and other investments to have more spendable money now, because I can make it up in my 30’s…” The poker face was strong for me that day, because I wanted to grab him and say, “But you’re screwing yourself out of your investments doubling by delaying it 10 years!! In 10 more years, those have now doubled again! Don’t stop investing, cut cable or other extraneous stuff, not the investments!! GAH!!!” Instead I just shook my head approvingly and said, “Well, not investing you’ll lose out on a lot of compounding with the market. Is there any other way you could cut spending instead of making cuts through your 401k?” Short answer: Nope, they track their spending and it’s all essential…
      Oh well, I tried anyway. I also gave him a copy of the millionaire next door a few months back, so maybe it will make a better impression than me. 🙂

  9. Brian

    Love the ongoing/updating word doc to pull information from when needed. I handed out copies of the Total Money Makeover to some co-workers a few years back. Interesting response, some read it and thanked me., others I’m sure are still collecting dust. I always enjoy the opportunity to pass along some knowledge.

    1. Mr SSC Post author

      Thanks, I figured I shuold save it when I first made one to show people what a couch potato portfolio was (my supervisor raves about that portfolio) and what index funds are, 401k’s, etc… That Paula Pant article is my go to for describing the basics of investing, especially DIY investing. Then as I got more questions I’d add to it, save it make a copy, delete the irrelevant stuff and send out the edited version. It’s taken a year or more to get to where it is today.

      I think I need to update my book choice, but the main reason was to show millionaires don’t have inflated lifestyles, and just because they “can afford it” doesn’t mean they “should afford it”, lol. I’m sure there are better books with better messages at this point. I’ll check out the Total Money makeover and maybe add it in there as well. 🙂

  10. Mrs. BITA

    Good work, Mr. SSC – I know you’ve been working on Pat for a while, it must be so rewarding to see it pay off finally.

    I’ve never talked FIRE at work, but folks have noticed that I know the answer to a lot of basic finance stuff (what is the limit for HSA contributions? Do employer contributions count towards the HSA limit or is it like a 401k? etc.), so I have lately been fielding more basic PF questions. My three wins this year have been convincing one colleague that they should max out their 401k, teaching another how to do a backdoor Roth and helping a third shift to our company HDHP offering and open an HSA.

    1. Mr SSC Post author

      Thanks, and yes it was super rewarding! That whole session took about 2.5 hrs during which our supervisor stopped by twice and was like, “you guys are still working on that?! That’s good, you need to pay attention to that stuff, keep at it!” and another co-worker stopped by and said, “Oh, I love talking finances, I don’t want to interrupt, carry on!” and 2 hrs later she came by and flabbergastedly said, “You’re still doing that?! Sheesh!!”

      I only have a couple of people I can talk FIRE to, and only a couple more that I talk openly about our situation, the rest are like you, just basic personal finance topics. Actually, HSA versus regular health plan came up and I drew out a diagram on the whiteboard, relating it back to 401k’s. Anyway, it fits well with a couple of co-workers, and not so much with Pat. I’ll take the wins where I can though.

      Congrats on your wins too! It’s nice helping people out, in whatever manner it presents itself. 🙂

    1. Mr SSC Post author

      Thanks! It takes subtelty (sp?) around here for sure. I keep at it. In our last team meeting, my supervisor was talking about getting people to start looking at finances and investing and how he was going to get some books everyone could read. One of my co-workers said, “Or you could just ask Mr. SSC”. I smiled but it felt good that I am seen as a resource to go to regarding finance topics. 🙂

  11. Laurie Blank

    Good for you, Mr. SSC! So sweet of you to mentor Pat. I have far too few money nerds IRL. Nearly everyone I know gives me the blank stare when I start talking about debt freedom, early retirement or whatever.

    I’ve mentored a few people, but they seem to be having a hard time avoiding instant gratification in order to reach their goals.

    I wonder if my extended family will be happy when they find I’m giving them all a copy of a new personal finance book for Christmas this year? 🙂

    1. Mr SSC Post author

      Thanks! Just yesterday I had someone else ask me if I could help with their 401k and retirement choices, so I’ll be helping them out today. They were even nodding in agreement about the “more aggressive while you’re younger” investment strategy and didn’t get glazed over eyes when I was talking about compounding interest and time being your friend. Woohoo!

      Keep at it, because I felt the same way with Pat over the last 18 months or so that I’ve been a mentor for them. Something clicked for them and boom, they knew I would be able to help.

      As far as the book goes, I’m sure some will appreciate it. If just one person reads it and finds it useful, I’d say it’s a win! 🙂

  12. Fervent Finance

    Awesome work. Your coworkers are lucky to have you as a sounding board. I tend not to broach the subject with colleagues too much, but will do it with friends and family as I feel more comfortable with them.

    1. Mr SSC Post author

      I used to be that way, but have been coming out of my shell more at work over the last year. It seems to be paying off because I have another co-worker wanting help with their 401k elections, so I’m working with them later today to get it set up for them. So exciting!

  13. Leroy Kincaid

    That’s so awesome!!
    I wish these kids at my work were interested in personal finance. When it does come up I get all excited and they just look at me like I’m old and boring. I just want to squeeze their neck and say ” please, please, listen to me”. But that may be the wrong approach. HA!!:)

    1. Mr SSC Post author

      Hahaha, yeah that could scare them off of finance or anythign coming from you alter on. 🙂

      It is nice having people come by and ask questions about investing, 401k’s loans, debt paydown and more. Recently, there have abeen a few more beyond Pat that have come by looking for answers. 🙂

  14. Jenny

    I know that stare! I don’t usually bring up the topic but when it does come up, and my enthusiasm for it shines through, it takes some people by surprise. It’s been fun, though.

    1. Mr SSC Post author

      Yeah it’s ahrd to not know that stare when talking finance and investing, lol. I’ve found being enthusiastic about something helps with being approachable for more questions later on. Good luck on your front. 🙂

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