Archives for May 18, 2018

Married women still rely to a large extent on their husbands to ensure their retirement will be comfortable, but for women who want to be financially independent of their spouse or who face retirement without a partner to support them financially, the barriers to saving enough are formidable.

Women face significant hurdles to saving enough to enable them to maintain the same standard of living in retirement as men:

• They earn less, on average, than men;
• On average, they outlive men by up to five years, which means their retirement capital needs to last for longer; and
• Women often put their careers on hold for a number of years to have and raise children with the result they usually have less time in which to accumulate their retirement savings.

Niel Fourie, the public policy actuary at the Actuarial Society of South Africa, says that, if a man and a woman retire at the same time with a comparable amount of retirement capital and similar income needs, the woman runs a greater risk of outliving her money.

“This means that a financially independent woman will need to accumulate more retirement capital during her working years than a man in order to secure the same level of retirement income for life,” Fourie says.

A rule of thumb says that the average person should be contributing at least 15% of his or her before-tax earnings towards retirement savings. Fourie says although this may be true for men, a financially independent woman should be investing closer to 20% of her pre-tax income to secure enough retirement-funding capital.

Say a man and a woman each earn R20 000 a month before tax. The man would need to put away R3 000 a month towards retirement, but the woman would have to invest closer to R4 000 every month to have the same amount of income in her retirement years, Fourie says.

Not only do women have to invest more than men to achieve a financially secure retirement, they usually also have less time in which to achieve this.

Let’s look at Jane’s situation. She starts investing for her retirement at age 25.

Her goal is to have an income that enables her to maintain her standard of living, which increases with inflation in retirement.

Her financial adviser tells her she can achieve this if she contributes 20% of her before-tax income to a retirement fund. She follows this advice, but from age 30 to 35 Jane takes some time off to raise a family.

Luckily, Jane did not cash in her retirement savings, but, when she returns to work after five years, her adviser tells her that she now needs to contribute 25% of her earnings to make up for lost time and capital.

If Jane had dipped into her retirement capital, the situation would have been even worse: she would have had to invest closer to 30% of her salary.

Fourie says as tempting as it may be to cash in on your retirement savings when you take a break from your career, it is not worth it. “Depending on your circumstances, you may never catch up. And to make it worse, you lose out on the benefits of compounding, which is the growth achieved on your original investment plus the growth on the returns already earned.”

Sound advice

Fourie has the following advice for women who want to be financially independent in their retirement years:

• Save and invest independently of your spouse or life partner.
• Wherever possible, don’t access your retirement savings when you take time off to raise your family.
• If you are younger than your partner and you are hoping to retire at the same time, make sure you factor this into your investment planning.
• If you cannot afford to retire completely, scale down your working hours rather than exiting your career completely. Pushing out your retirement date can help you to increase your retirement capital significantly.
• Take an active interest in your finances and ensure that you participate in important decisions such as saving for your retirement.
• Plan ahead and consider what would happen if your life partner dies, becomes disabled or ends the relationship. Does your antenuptial contract give you the right to claim a portion of his retirement capital if you get divorced? Will it be enough to fund your retirement?

Programming, marketing and facility management are all critical components of campus recreation, but it costs money to execute most anything.

“Budget planning is a balance to make data-driven decisions to meet the needs of the institution and plan for the future,” said John MacDonald, the director of recreation at the University of Akron.

In fact, there are several elements of your budget to take into account. “With your department’s values as a baseline, the budget should focus on four separate considerations: wages and personnel, supply and services, capital initiatives, and revenue generation,” said Jeff Konya, the athletic director at Northeastern University.

With that in mind, here are 12 tips to build a comprehensive budget for your rec center:

1. Keep Track of What You Need

Konya: “A successful budget manager must be both organized and analytical in assessing the needs and current realities within the organization. In effect, there needs to be a factual baseline of known and shared information like participation usage, new trends in technology, popularity of equipment and programming, etc.”

MacDonald: “Keep a running list of the following: new programs – including staffing, equipment needs and potential student engagement impact — capital projects, revenue opportunities, professional development — student and professional staff — and equipment and maintenance needs. Without these running lists, when the budget time comes around, there might be items that are missed because they were not captured when someone came up with them.”

2. Include Your Whole Department

Konya: “As an overarching philosophy, we try to implement strategies centered around a student-led facility which impacts decisions on staffing and programming. In our student-led model, utilizing programs such as federal work study could help re-allocate resources.”

MacDonald: “We have amazing and talented teams, so we utilize them. They will be on the front lines and can provide details that could otherwise be missed. Have all areas submit budgets, and support them in accountability and budget planning.”

3. Don’t Forget Other Departments

Konya: “I use the ‘break any silo’ mentality. It is not campus recreation versus everyone. In fact, the campus has formal and informal solutions that can have the effect of expanding the reach and impact of each dollar. Formally, an effective budget manager should utilize the procurement office to ensure best possible processes for goods and services. Along these lines, the campus may have effective educational programs on important topics relating to finances and the budget. Also, a campus may have a surplus division that can provide certain items to the organization at significant discounts. Informally, there are many strategies to share costs and create win-win scenarios across campus. Is there an opportunity to partner with other departments to buy in bulk, bring in speakers for professional development or to purchase common software?”

4. Plan for the Demands

Konya: “The equipment and programming needs must match the user demands of the facility. It is critical the organization uses a replacement schedule for its equipment, has a robust accounting system of its inventory and has a good sense of growing trends in the industry for rapid implementation.”

MacDonald: “Plan for what you want, not what you don’t want. It’s easy to play the ‘what if’ game so far that the original intent and design of a program or space will change in such a way it loses its intended purpose.”

5. Examine the Data

MacDonald: “Utilize forecasted and historic data. Technology is great to view multiple perspectives and evaluate a budget request compared to actuals and previous data.”

6. Evaluate Your Budget Constantly

Konya: “At Northeastern, we try to be very detailed with purchasing and reconciliations, including very comprehensive monthly reports.”

MacDonald: “Consistently revisit your budget and review monthly and quarterly statements and track actuals. This will help you better control financial decisions and know where you’re heading for the year.”

7. Make Strategies that Generate Revenue

Konya: “Most people, when they hear the word ‘budget,’ equate it to cost containment. But I would advise not to forget about the other side of the coin, namely revenue generation. Be entrepreneurial when appropriate, especially in possible revenue generation situations. Selling community memberships or renting out facility space is not a unique concept. It is one that could be considered along with a whole host of other ventures like retail, food service, community programming and summer camps, to name a few. The win-win solution is to find a revenue generating solution that can actually enhance the overall experience.”

8. Make it Readable

MacDonald: “When summarizing your budget, prepare information in the context that if someone reading it has no idea about recreation, your summary gives them the information they need.”

9. Maintain Your Equipment

MacDonald: “Preventative maintenance can lead to huge savings. If we don’t routinely maintain our facilities and equipment, we could have large expenses that could have been addressed with routine and consistent preventative maintenance.”

10. Research Before Making Buying Decisions

Konya: “I like to advocate a thought process in the organization of, ‘Is this how you would make this financial decision from a personal standpoint?’ For example, if you are doing work travel, are you purchasing airfare and hotels in advance for cheaper costs or waiting until the last minute? Hopefully, being a good steward of the resources given can be incorporated into a healthy culture expectation.”

MacDonald: “Do your homework when purchasing. When putting something out to bid, make sure it has the exact specifications you want — this will help narrow the results you receive. Research products and pricing, and don’t be afraid to ask for a better deal or leverage your buying power with larger purchases.”

11. Allow Your Staff to Grow

MacDonald: “Whenever possible, maintain development opportunities for student and professional staff. Certifications, workshops and conference presentations all create opportunities for growth and development that have lasting effects for both the individual and department.”

12. Align with the Department Mission and Vision

Konya: “One could make a case that any of the four budget ‘buckets’ — wages and personnel, supply and services, capital improvements, or revenue generation — should be prioritized based on the unique and timely needs of the organization.”

MacDonald: “Use of the department mission and vision should help guide this. Who do you serve, and in your budget decisions, are you serving them?”

Morgantown, WVa. – It’s the biggest fashion decision a woman will ever have to make. But the hunt for the perfect wedding gown can be filled with drama, tears, and high emotions.

Kristen DeMedici, owner of The Vow Boutique said, “The most important thing is to just have fun with it. This is an experience, this isn’t going shopping at Banana Republic for a dress for work, this is your wedding dress.”

Kristen and the girls at The Vow Boutique have some tips to finding your dream dress. First, bring supportive people with you.

“Far too many times brides leave here with a dress that was their grandmother’s favorite dress or their mom’s favorite dress and they leave their dream wedding dress here because they wanted to make someone else happy. Nothing is harder for us than watching a bride walk out that is defeated,” said DeMedici.

When it comes to trends, there is a dress for every shape, size, and style. From sheath dresses, to mermaid, trumpet, fit and flair and of course ball gowns!

“It’s super important to try on a little bit of everything. You kind of have to blindly trust your consultant too! There are so many times we’ll pull something and they are like “no no,” then you put it on and it’s a totally different dress.”

Set a dress budget before you even walk into the store. Gowns can range from $100 all the way up to $6,000.

DeMedici added, “When you come in and we ask you “what’s your budget?” we’re not asking that to be rude or noisy. We are asking it because we really want to have a guidance as to where to send you, so you’re not coming in and grabbing a beautiful Haley Paige gown only to go “I can not afford it.”

Don’t forget what is most important in a dress, is the woman who is wearing it.

“It’s a time that should be celebrated and should be fun and not stressful. It should just be have a glass of champagne and shop around and enjoy every moment of it with the people you love.”

Happy Planning!