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Creating a Budget

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“Before you recoil in horror at the idea of keeping track of every dollar that passes through your hands, remember that creating, maintaining, and periodically tweaking your budget is a vital aspect of preparing for retirement. You may be able to get away with ignoring your money choices while you are working full time and bringing home a good salary, but maintaining that same level of money ignorance as you prepare for retirement is a good way to ensure your plans and finances go off the rails. Knowing how you spend your money will allow you to make the decisions that make the difference between an enjoyable and well-funded retirement and learning to enjoy meals of crackers with ketchup.” Emily Guy Birken, The 5 Years Before You Retire: Retirement Planning When You Need it the Most

If you want to do more with your money and have a positive impact on your financial situation — a budget is critical. You need one so you can take charge of your finances and meet your biggest financial goals.

If you’re scrambling to pay the bills each month, you’re like most Americans and would probably benefit from having a budget. In America, we have a spending problem. Inherently, we desire to drive the latest luxury vehicle, wear the fashionable clothing or take the most extravagant vacation, whether we can afford it or not. The entertainment media and advertisers only encourage the conspicuous spending and consumption which compounds the financial woes of American society.

Schwab Wealth Survey

According to a Charles Schwab 2019 Modern Wealth Survey, “more than a third of Americans admit their spending habits have been influenced by images and experiences shared by their friends on social media and confess they spend more than they can afford to avoid missing out on the fun.” The survey examined how a 1,000 Americans think about saving, spending, investing and wealth.

Survey respondents tended to place the blame on social media platforms and not people, “ranking social media as the biggest “bad” influence when it comes to how they manage their money, while they put friends and family at the top of “good” influences.”

According to the survey, “three in five Americans pay more attention to how their friends spend compared to how they save, with an equal number saying they’re at a loss to understand how their friends are able to afford the expensive vacations and trendy restaurant meals they portray on social media.”

Furthermore, the survey finds that “the pressure to spend as a result of social media envy and the desire to not be left out of friends’ experiences is particularly acute among Generation Z and millennial.”

Why a budget

Establishing a budget and monitoring it on a regular basis is the best way to ensure you are in control of your financial future. Think of your budget as a spending plan. It helps you to be aware of how much money you have, where it needs to go, and how much, if any, is left over.

A budget is a plan you write down to decide how you will spend your money each month. A budget helps you ensure you will have enough money every month. Without a budget, you might run out of money before your next paycheck. Essentially, a budget shows you how much money you make and how you spend your money.

A budget helps you decide what you must spend your money on and if you can spend less money on some things and more money on other things. For example, your budget might show that you spend $100 on clothes every month. You might decide you can spend $50 on clothes. You can use the rest of the money to pay bills or to save for something else.

You might need money for an emergency. You also might need to buy something more expensive, like a car. Saving money might help you buy a car, put a security deposit on an apartment, or pay for something else expensive.

Start a budget by gathering your bills and pay stubs. Think about how you spend money, besides paying your bills. For example, do you buy a cup of coffee every day? After a month, that coffee money could add up to an expense you might write down.

When you have your bills and pay stubs, recommend you write down your expenses. An expense is money you spend. Then, write down how much money you make. This is called income. And, finally, you should subtract your expenses from how much money you make. If the number is less than zero, you are spending more money than you make. Look for things in your budget you can change.  Maybe something you do not need, or a way to spend less. Use a Budget Worksheet to help you create a budget.

A budget is something you use every month. A written budget will help you to see where you spend money, to figure out where you can save, and to make a plan for how to spend and save your money. Your budget can help you save money for the future. You can make savings one of your expenses. You might find ways to spend less money. Then you can put money into savings every month – maybe into a bank or credit union.

Why Save Money

It can be hard to save money. It is very hard when your expenses go up and your income does not. Here are some reasons to try to save money even when it is not easy.

  • Emergencies – Saving small amounts of money now might help you later. Everyone has expenses they do not expect.
  • Expensive things – Sometimes, we have to pay for expensive things – like a car, a trip, or a security deposit on an apartment. You will have more choices if you have money to pay for those expensive things.
  • Your goals – You might want to pay for college classes. Maybe you need to visit family in another country. You can plan for these goals and save money. Then you might not have to use a credit card or borrow money to pay.

How to Save Money

For one month, write down everything you spend. This would include small expenses, like a cup of coffee, which can add up to a lot of money. When you know where you are spending your money, you can decide what you might not want to buy.

Additionally, pay with your credit card only if you can pay the full amount when the bill comes. That way, you do not pay interest on what you owe. And, pay your bills when they are due. That way, you will not owe late fees or other charges.

Keep the money you are saving separate from the money you spend. Consider opening a savings account in a bank or credit union. If you keep cash at home, keep the money you are saving separate from your spending money.  Keep all your cash someplace safe.

Budget is a Planning Tool

A budget is a plan that shows you how you can spend your money every month. Making a budget can help you make sure you do not run out of money each month. A budget also will help you save money for your goals or for emergencies.

Make a budget by writing down your expenses. Expenses are what you spend money on. Expenses include bills such as expenses that are the same each month, like rent; expenses that might change each month, like utilities; and, expenses that you pay once or twice a year, like car insurance.

Other expenses includes items like food, gas, entertainment, clothes, school supplies, money for family, unplanned expenses, like car repairs or medical bills, and credit card bills. You might have bills that change every month. Look at what you paid for the same month last year. You might need $200 for your gas bill in January, but $30 in July.

Write down how much money you make. This includes your paychecks and any other money you get, like child support. Then, subtract your expenses from how much money you make. This number should be more than zero. If it is less than zero, you are spending more money than you make. Look at your budget to see what you do not need or what you could spend less on.

Making a Budget

Below are four methods for helping you organize and manage your monthly expenses.

Fixed and Flex

The first budgeting technique involves grouping your expenses into two categories—“fixed,” which are must-haves like food and utilities; and “flex,” the nice-to-haves like vacation or dining out Keeping these definitions in mind, follow the four-step process below

  1. Gather 6 to 12 months of bank statements, receipts and other financial records.
  2. Separate those expenses into “Fixed” and “Flex” columns.
  3. Add up your monthly “Fixed” expenses, then subtract the total from your monthly income.
  4. What’s left over is your “Flex” spending money.

Although you’re still dealing with the same amount of money, looking at your finances in a more organized way can help get your spending under control.

50/30/20 rule

Another budgeting technique is the 50/30/20 rule. It involves dividing your monthly income into three ”buckets”:

  • 50% (or less) goes to necessities such as housing, student loans and utilities. These are expenses you have to pay every month.
  • 30% (or less) goes to nice-to-haves, such as entertainment, hobbies and travel.
  • 20% (or more, if possible) goes toward savings and paying down debt.

The 50/30/20 rule can be adjusted based on your short- and long-term goals, but be careful about confusing “nice-to-haves” for “necessities.” Several dinners out each week and unlimited data plans may be nice to have, but they aren’t essential.

Tracking

Tracking takes the most time, but it provides the greatest insight into your spending habits.

First, create columns for your spending categories (e.g. groceries, gas, utilities, medical, entertainment, and child care). Add a “miscellaneous/unexpected” and a “savings” category as well.

Next, divide your monthly income among the categories and then pay your bills/save accordingly. It’s important to list all items and subtract the amount you spend in each category so you know where your money is going. Once a category is “out of money”:

  • Stop spending in that category if possible, until you get your next paycheck
  • Consider making trade-offs by moving money around from other categories

Use a spreadsheet, an online service or, if you prefer to go “low tech,” a notebook and pen will work just fine.

Allowance

One last idea is to set up three accounts: one for expenses, one for fun money, and one for savings. Deposit percentages of your paycheck into each account, and pull from the appropriate one throughout the month to cover your living costs and your discretionary spending.

Use a Budget

  1. A budget should meet your “needs” first, then the “wants” that you can afford.
  2. Your expenses should be less than or equal to your total income.
  3. If your income is not enough to cover your expenses, adjust your spending by deciding which expenses can be reduced or eliminated.

You can use your budget at the beginning of every month to make a plan for how you will spend your money that month. First, rite what you think you will earn and spend. Afterwards, rite down what you spend. Try to do this every day.

At the end of the month, see if you spent what you planned, use the information to help you plan the next month’s budget.

Your money is stretched in many directions. Daily expenses, entertainment, life events and long-term goals—all competing for the same dollar. Budgeting can help ensure you’re covering the necessary monthly expenses, saving for the future and—maybe—have some extra cash to reward yourself for your good work.

Sources:

  1. https://www.aboutschwab.com/modernwealth2019
  2. https://www.consumer.gov/articles/1002-making-budget#!what-to-know
  3. https://www.trulia.com/blog/budget-ideas-for-people-who-hate-budgets/?fbclid=IwAR3DyoX3GJmAjEvIOaBKa9THQcNMTtMXjmlfINcSyl4l0v4l9K8tqhdx2yk

Bill Campbell – Trillion Dollar Coach

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“In business, compassion is a key factor to suc­cess.” Bill Campbell

‘Bill’s passion for innovation and teamwork was a gift to Apple and the world’. Tim Cook, CEO, Apple

‘Bill shared his wisdom generously, expecting nothing back but the joy he got from teaching others.’ Sheryl Sandberg , COO, Facebook

Bill Campbell helped to build some of Silicon Valley’s greatest companies — including Google, Apple, and Intuit — and to create over a trillion dollars in market value. Campbell believed that teams, not individuals, are the fundamental building blocks of organizations. Leaders can help their team be more productive, more innovative, and just plain happier by leading like a coach, not just a manager.

A former college football player and coach, Bill mentored visionaries such as Steve Jobs, Larry Page, and Eric Schmidt and coached dozens of leaders on both coasts. When he passed away in 2016, “the Coach” left behind a legacy of growing companies and successful people, and an abundance of respect, friendship, and love.

Eric Schmidt, Jonathan Rosenberg, and Alan Eagle experienced firsthand how Coach Bill built trusting relationships, fostered personal growth—even in those at the pinnacle of their careers—inspired courage, and identified and resolved simmering tensions that inevitably arise in fast-moving environments. To honor their mentor and inspire and teach future generations, they have chronicled Bill Campbell’s wisdom in the guide entitled Trillion Dollar Coach: The Leadership Playbook of Silicon Valley’s Bill Campbell.

Trillion Dollar Coach is a guide for bringing out the best in others and teams, for being simultaneously supportive and challenging, and for giving “more than lip service to the notion of putting people first”.

“A coach is someone who tells you what you don’t want to hear, who has you see what you don’t want to see, so you can be who you have always known you could be.” Tom Landry, former NFL Dallas Cowboy’s Coach

Good coaches employ encouragement, honesty, and caring to help every team member flourish. And according to Bill Campbell, business leaders should do the same, infusing their workplaces with compassion and people-first values that inspire employees to do their best work—and love their jobs.

Based on interviews with more than eighty people who knew Bill Campbell, Trillion Dollar Coach explains the Coach’s principles and illustrates them with stories from the companies and people with whom he worked and coached. The result is a blueprint for forward-thinking business leaders and managers that will help them create higher-performing and faster-moving teams and companies.

“Bill was the greatest executive coach the world has ever seen,” according to the authors. He coached executive leaders and also coached entire teams as a group coach. In the technology sector, innovation and speed are paramount, according to the authors. It is high-performing teams that lead to success.

“He always gave you a sense of perspective…what really matters at the end of the day is how you live your life and the people in your life.”

Bill cared about people. He treated everyone with respect, he learned their names, he gave them a warm greeting. He cared about their families, and his actions in this regard spoke more loudly than his words. “He cared about the whole you,” says Ruth Porat, Google’s CFO.

Bill would start meetings by asking about a colleague’s family and weekend and talking about his own. He always gave you a sense of perspective. That whatever you were doing was important, but he showed you that what really matters at the end of the day is how you live your life and the people in your life. It provided his coachees a respite in a busy day and a chance to ease their work-family conflict at least momentarily.

Bill made it okay to bring love to the workplace. He created a culture of what people who study these things call “companionate” love: feelings of affection, compassion, caring, and tenderness for others, according to the authors. He did this by genuinely caring about people and their lives outside of work, by being an enthusiastic cheerleader, by building communities, by doing favors and helping people whenever he could, and by keeping a special place in his heart for founders and entrepreneurs.

Bill Campbell’s Manifesto:
 
People are the foundation of any company’s success. The primary job of each manager is to help people be more effective in their job and to grow and develop. We have great people who want to do well, are capable of doing great things, and come to work fired up to do them. Great people flourish in an environment that liberates and amplifies that energy. Managers create this environment through support, respect, and trust.
 
Support means giving people the tools, information, training, and coaching they need to succeed. It means continuous effort to develop people’s skills. Great managers help people excel and grow.
 
Respect means understanding people’s unique career goals and being
Key takeaways from Bill Campbell and The Trillion Dollar Coach:
  1. Your title makes you a manager. Your people make you a leader.To be a good leader, you need to first be an excellent manager by accruing respect and not demanding it.
  2. It’s the people.The top priority of any manager is the well-being and success of his/her people.
  3. Start with trip reports.To build rapport and better relationships amongst team members, start team meeting with personal or non-business related topics.
  4. 5 words on a whiteboard.Have a structure for one-on-one’s and take the time to prepare for them, as they are the best way to help people be more productive and to grow.
  5. The best idea, not consensus.A manager’s job is to run a decision-making process that ensures that all perspectives get heard and considered. If necessary, to break ties and make a decision.
  6. Lead-based on first principles.Defining the “first principles” for the situation, the unchangeable truths that are the foundation for the company or product, and help guide the decision from those principles.
  7. Manage the Aberrant Genius.“Aberrant Geniuses” are high performing but difficult team members, should be tolerated and even protected as long as their behavior isn’t unethical or abusive and when their value provided outweighs the toll their behavior takes on management, colleagues and teams.
  8. Money’s not just about the money.Compensating people well demonstrates love and respect, which ties them firmly to the goals of the company.
  9. Innovation is where crazy people have stature.The purpose of a company is to bring a product vision to life. All the other components are in service to the product.
  10. Build an envelope of trust.Listen attentively, practice complete frankness and be an evangelist for courage by believing in people more than they believe in themselves.
  11. Only coach the coachable.Traits that make an individual coachable include honesty, humility, willingness to persevere, hard working and a constant openness to learning.
  12. Practice free-form listening.Listen to people with your full and undivided attention without continually thinking ahead to what you’re going to say next. Instead, ask questions to get to the real issue.
  13. No gaps between statements and fact.Be relentlessly honest and candid, couple negative with caring feedback. Give feedback as soon as possible, and if the feedback is negative, deliver it privately.
  14. Don’t stick it in their ear.Don’t tell people what to do, instead offer stories and help guide them to the best decisions for them.
  15. Full identity front and center.People are most effective when they can be completely themselves and bring their whole identity to work.
  16. Team first. The team is of utmost importance; the most important thing to look for in people is a team-first attitude.
  17. Work the team, then the problem. When faced with a challenge or an opportunity, the first step is to ensure the right team is in place and working on it.
  18. Pick the right players.The top characteristics to look for are smarts and hearts. E.g. the ability to learn fast, a willingness to work hard, integrity, grit, empathy and a team-first attitude.
  19. Pair people.Peer relationships are critical and often overlooked, so seek opportunities to pair people up on projects or decisions.
  20. Get to the table.Winning often depends on having the best teams consisting of a mix of genders.
  21. Solve the most significant problem first.Identify the biggest issues, bringing it to the front and tackling it first.
  22. Don’t let the bitch sessions last.Air all negative issues, but don’t dwell on them. Learn to move on and move on as fast as possible.
  23. Winning right.Strive to win, but always win right with commitment, teamwork and integrity.
  24. Leaders lead.When the going gets tough, teams are often looking for even more loyalty, commitment and decisiveness from their leaders.
  25. Fill the gaps between people.Listen, observe and fill the communication and understanding gaps between people.
  26. It’s OK to love.People on your team are human beings by nature, and the group becomes stronger when you break down the walls between the professional and human personas, embracing them with love.
  27. To care about people, you have to care about people.Ask about their lives outside of work, understand their families and show up.
  28. Cheer demonstrably for people and their success.Don’t just sit there, stand up and show them the love for the work they are doing. Energize, motivate and inspire people to keep them moving.
  29. Always build community.Build communities inside and outside of work. A place is much stronger when individuals are connected.
  30. Help people.Be generous with your time, connections and other resources.
  31. Love the founders.Hold a special reverence for and protect the people who are the founders of the company, often these people are the ones with the most vision and passion for the company.
  32. Build relationships whenever you can. Be it when you’re in the elevator, passing someone in the hallway, or see your teammates in the cafeteria, take the time to stop and chat about their lives and share a little about yours.

What makes great companies great is not solely the culture but also the people that help to build that culture.

About the Authors

  • Eric Schmidt served as Google CEO and chairman from 2001 until 2011, Google executive chairman from 2011 to 2015, and Alphabet executive chairman from 2015 to 2018.
  • Jonathan Rosenberg was a Senior Vice President at Google and is an advisor to the Alphabet management team. He ran the Google product team from 2002 to 2011.
  • Alan Eagle has been a director at Google since 2007. Formerly Eric and Jonathan’s speechwriter, he currently runs a set of Google’s sales programs.

References:

  1. https://trilliondollarcoach.com
  2. https://www.slideshare.net/mobile/ericschmidt/trillion-dollar-coach-book-bill-campbell
  3. https://trilliondollarcoach.com/static/common/images/pdf/trillion-dollar-coach_preview.pdf
  4. https://www.fastcompany.com/90331367/bill-campbell-silicon-valley-trillion-dollar-coach-book
  5. https://medium.com/motivationlifehacks/book-summary-trillion-dollar-coach-bill-campbell-6ad32cd607f3#:~:text=Key%20takeaways%3A,respect%20and%20not%20demanding%20it.

Be Cyber Smart: Prevent Identity Theft and Internet Scams

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Americans are more vulnerable than ever to cyber attacks arising from the pandemic.

Today’s technology allows Americans to connect around the world, to bank and shop online, and to control their homes, smart devices and cars from their mobile phones. And with the advent of 5G, this capability to connect and to control will expand exponentially. With this added convenience comes an increased risk in cybercrime of identity theft and internet scams.

Additionally, most Americans and business owners are not well versed in cybersecurity, nor understand the financial impact it can have on their everyday remote work and online lives and businesses. Meanwhile many people approach security as a purely technical challenge dictated by technology and security updates. With this change in behavior brought by COVID pandemic comes additional cyber security risks to privacy and personal information.

Cybercriminal activity is one of the biggest challenges that humanity will face in the next two decades and it causes far more financial damage than people can imagine, according to Cybersecurity Ventures. By 2021, Cybersecurity Ventures estimates that cybercrime could cost upwards to $6 trillion to protect and/or recover from cybercrime. When companies like Yahoo or Equifax are hacked, it causes the size, sophistication, and cost of these crimes to grow at an astronomical rate.

Did you know

  • The average financial cost of a data breach for a US company in 2019 was $8.19 million. That’s an increase of 130% since 2006!
  • 7-10% of the U.S. population are victims of identity fraud each year, and 21% of those experience multiple incidents of identity fraud.

Cybercrime costs include damage and destruction of data, stolen money, lost productivity, theft of intellectual property, theft of personal and financial data, embezzlement, fraud, post-attack disruption to the normal course of business, forensic investigation, restoration and deletion of hacked data and systems, and reputational harm.

Common internet scams

As technology continues to evolve, cybercriminals will use more sophisticated techniques to exploit technology to steal your identity, personal information, and money. To protect yourself from online threats, you must know what to look for.

Cybercriminals — from government-backed groups to organized crime gangs — are using the public’s fear, uncertainty, and curiosity about the pandemic to adapt their techniques, tactics, and targeting strategies.

  • There has been an increase in the number of phishing, malicious sites, and business email compromise attempts linked to the pandemic. This malicious content can appear as fraudulent news updates, precautionary guidance, virus maps, friend requests, or employer’s memos.
  • Cyber criminals, conducting data theft for economic gain, extortion, disruptive or destructive ransomware attacks, have targeted individuals and organizations perceived as under pandemic-related stress and strain.

Some of the most common Internet scams include:

  • COVID-19 Scams take the form of emails with malicious attachments or links to fraudulent websites to trick victims into revealing sensitive information or donating to fraudulent charities or causes. Exercise caution in handling any email with a COVID-19-related subject line, attachment, or hyperlink, and be wary of social media pleas, texts, or calls related to COVID-19.
  • Imposter Scams occur when you receive an email or call from a person claiming to be a government official, family member, or friend requesting personal or financial information. For example, an imposter may contact you from the Social Security Administration informing you that your Social Security number (SSN) has been suspended, in hopes you will reveal your SSN or pay to have it reactivated.
  • COVID-19 Economic Payments scams target Americans’ stimulus payments. CISA urges all Americans to be on the lookout for criminal fraud related to COVID-19 economic impact payments—particularly fraud using coronavirus lures to steal personal and financial information, as well as the economic impact payments themselves—and for adversaries seeking to disrupt payment efforts.

Simple tips for online safety and protection

Getting educated and savvy on how to recognize and react to phishing emails and cyber threats may be the best way to protect yourself virtually and financially against cybercrime.

  • Double your login protection. Enable multi-factor authentication (MFA) to ensure that the only person who has access to your account is you. Use it for email, banking, social media, and any other service that requires logging in. If MFA is an option, enable it by using a trusted mobile device, such as your smartphone, an authenticator app, or a secure token—a small physical device that can hook onto your key ring.
  • Shake Up Your Password Protocol. According to NIST guidance, you should consider using the longest password or passphrase permissible. Get creative and customize your standard password for different sites, which can prevent cyber criminals from gaining access to these accounts and protect you in the event of a breach. Use password managers to generate and remember different, complex passwords for each of your accounts. Read the Creating a Password Tip Sheet for more information.
  • Be up to date. Keep your software updated to the latest version available. Maintain your security settings to keeping your information safe by turning on automatic updates so you don’t have to think about it, and set your security software to run regular scans

Protect yourself from online fraud

Stay Protected While Connected: The bottom line is that whenever you’re online, you’re vulnerable. If devices on your network are compromised for any reason, or if hackers break through an encrypted firewall, someone could be eavesdropping on you—even in your own home on encrypted Wi-Fi.

  • Practice safe web surfing wherever you are by checking for the “green lock” or padlock icon in your browser bar— this signifies a secure connection.
  • When you find yourself out in the great “wild Wi-Fi West,” avoid free Internet access with no encryption.
  • If you do use an unsecured public access point, practice good Internet hygiene by avoiding sensitive activities (e.g., banking) that require passwords or credit cards. Your personal hotspot is often a safer alternative to free Wi-Fi.
  • Don’t reveal personally identifiable information such as your bank account number, SSN, or date of birth to unknown sources.
  • Type website URLs directly into the address bar instead of clicking on links or cutting and pasting from the email.

If you discover that you have become a victim of cybercrime, immediately notify the business and authorities to file a complaint. Keep and record all evidence of the incident and its suspected source.

For more information about how you can Do Your Part. #BeCyberSmart, visit www.cisa.gov/ncsam

References:

  1. https://www.cisa.gov/sites/default/files/publications/NCSAM_TheftScams_2020.pdf
  2. https://www.ey.com/en_us/consulting/covid-19-steps-to-defend-against-opportunistic-cyber-attackers?WT.mc_id=10642922&AA.tsrc=paidsearch
  3. https://cybersecurityventures.com/hackerpocalypse-cybercrime-report-2016/
  4. https://www.cisa.gov/shop-safely

Healthy Aging and Lifestyle: Achieving Happiness and Purpose

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“If there’s one thing I’ve learned in my years on this planet, it’s that the happiest and most fulfilled people are those who devoted themselves to something bigger and more profound than merely their own self-interest.” John Glenn

Healthy Aging with purpose is about embracing opportunities to reshape your lives, connect with and help one another, and change the world for the better —all while learning, growing, getting better and having fun!

Work at your relationships all the time. Take care of friendships, hold people you love close to you, take advantage of birthdays and celebrate fiercely.
Patti LaBelle

References:

  1. https://seniorplanet.org/14-of-the-best-quotes-about-aging/
  2. https://www.zyto.com/5-inspirational-quotes-for-healthy-aging

The Economic Cost of Black Inequality in the U.S. | Citigroup

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Racism stymies national economic growth and is bad financially for business

“We’re in the midst of a national reckoning on race, and words are not enough.  We need awareness, education and action that drive results.”  Mark Mason, Chief Financial Officer of Citigroup

Citigroup research found that if the U.S. could instantly end the most severe forms of economic discrimination against African Americans, it could give the economy a $5 trillion boost to gross domestic product (GDP) over the next five years.

Racial inequalities shaved about $16 trillion from U.S. GDP

During the past 20 years, race-based inequalities shaved about $16 trillion from GDP, Citigroup estimated in a CLOSING THE RACIAL INEQUALITY GAPS: The Economic Cost of Black Inequality in the U.S. study. Citigroup said it “studied the costs of lost wages, fewer opportunities for higher education and less access to home and small-business loans” for African Americans.

“What this report underscores is that this tariff is levied on us all and, particularly in the U.S., that cost has a real and tangible impact on our country’s economic output,” Citigroup Vice Chairman Raymond J. McGuire said in the report. “We have a responsibility and an opportunity to confront this longstanding societal ill.”

Furthermore, today in the midst of the COVID-19 pandemic, Black, Latin, and Native Americans have been hospitalized for COVID-19 at a disproportionately high rate, a direct result of what the Centers for Disease Control and Prevention has identified as “long-standing systemic health and social inequities.” Blacks and People of Color are also bearing a disproportionate share of the pandemic’s economic devastation.

Citigroup believes that they, as a major U.S. financial institution, “have a responsibility to address complex societal questions” and “to address current events and to frame them with an economic lens in order to highlight the real costs of longstanding discrimination against minority groups, especially against Black people and particularly in the U.S.”

Four key racial gaps for Blacks

The analysis in the report shows that if four key racial gaps for Blacks —wages, education, housing, and investment — were closed 20 years ago, $16 trillion
could have been added to the U.S. economy. And if the gaps are closed today, $5 trillion can be added to U.S. GDP over the next five years.  The Citi study assessed that:

  • Closing the Black racial wage gap 20 years ago might have provided an additional $2.7 trillion in income available for consumption and investment.
  • Improving access to housing credit might have added an additional 770,000 Black homeowners over the last 20 years, with combined sales and expenditures adding another $218 billion to GDP over that time.
  • Facilitating increased access to higher education (college, graduate, and vocational schools) for Black students might have bolstered lifetime incomes that in aggregate sums to $90 to $113 billion.
  • Providing fair and equitable lending to Black entrepreneurs might have resulted in the creation of an additional $13 trillion in business revenue over the last 20 years. This could have been used for investments in labor, technology, capital equipment, and structures and 6.1 million jobs might have been created per year.

Closing the wage, housing, education, and business investment racial gaps can help narrow the wealth gap, which is significant for facilitating homeownership, business, and job creation, plus establishing a pipeline for intergenerational wealth accumulation.

It’s hoped that Citigroup’s study brings perspective that collectively Americans can find substantive and sustainable opportunities to address the racial inequality gaps identified in the research.

References:

  1. https://www.americanbanker.com/articles/citigroup-vows-to-become-antiracist-review-internal-policies‘
  2. https://ir.citi.com/NvIUklHPilz14Hwd3oxqZBLMn1_XPqo5FrxsZD0x6hhil84ZxaxEuJUWmak51UHvYk75VKeHCMI%3D

Cyber Attacks Becoming Faster and More Sophisticated

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“One thing is clear…with cyber attacks becoming faster and more sophisticated, education about prevention is necessary for everyone.”

More and more Americans are using cyber technologies and spending more time online during COVID-19 than ever before. Our growing dependence on technology, coupled with the increasing threat of cyber attacks, demands greater security in our online world.

Consequently, the FBI has seen a significant spike in cyber crimes reported to its Internet Crime Complaint Center (IC3) since the beginning of the COVID-19 pandemic, as hackers take advantage of Americans’ daily activities moving increasingly online. IC3 has been receiving between 3,000 and 4,000 cybersecurity complaints each day, a major jump from prior to the COVID-19 pandemic when about 1,000 complaints were received daily.

Additionally, Microsoft reports that COVID-19 themed attacks, where cybercriminals get access to a system through the use of phishing or social engineering attacks, have jumped to 20,000 to 30,00 a day in the U.S. alone. And, researchers for the cyber group Barracuda Networks found a 667 percent increase in phishing emails using the coronavirus to trick individuals into clicking links or downloading attachments that included computer viruses, such as ransomware that lock up computers and demands a ransom to unencrypt them, according to The Hill.

Both the FBI and the Department of Homeland Security’s Cybersecurity and Infrastructure Security Agency (CISA) have put out alerts warning Americans to watch out for these phishing emails while working from home.

To protect yourself and your money from cyber threats, it is important to understand how hackers think and act. Today’s hackers are using “social engineering” to take information they glean from social media and publicly available information, such as speaking engagements and media profiles. Armed with that data, they target people using personal details that make them feel comfortable sharing pertinent information.

Hackers can spoof phone numbers or email addresses to look like they’re coming from a legitimate financial or mobile service provider. They ask questions or send links that mine for personal data, such as credit card numbers and identifying information.

“Defend Today, Secure Tomorrow”—Protect Yourself from Cyberattacks

It’s imperative to understand the nature of cybercrime and to get educated about avoiding it. While nothing is foolproof, there are tangible steps you can take to ensure you are not an easy target for hackers.

Five Ways to Keep Your Information and Systems Secure:

  1. Use two-factor authentication everywhere you can. Yes, it can make logging in more time-consuming, but it’s much more difficult for a hacker to breach your password and access your PC or phone.
  2. Make your passwords more complicated and use different ones for different sites or a password vault. Use phrases that are longer, rather than generic word and number combinations that fall into a pattern (e.g., Fall2019, Winter2019). A phrase such as ILoveBuckeyes! is more difficult to hack. If remembering multiple passwords is an issue, try a recommended password vault provider, an online service designed to help keep your password information secure and consolidated into one location, such as 1Password, KeePass, LastPass, or Dashlane.
  3. Make sure you keep your computer software up to date. Security updates are designed to fix known attacks or vulnerabilities that software developers are monitoring and addressing.
  4. Be careful of how much information you share on social media. Social engineers can track your spending habits, location, busy times on your schedule, travel plans, and more and strike when you’re preoccupied, attending functions, at work, or traveling. That catchy Facebook quiz? Watch out if it asks for too much personal data like your birthdate or address.
  5. Do not give out personal information without verification. Hackers can impersonate financial services providers. If you receive an email or phone call that looks official, do not respond directly. Use the phone number on your financial services provider’s statements to call and confirm whether the call/email was genuine. Never give out your Social Security number or credit card information to an unverified person on the phone, and avoid clicking on any links in emails you receive.
STOP. THINK. CONNECT. ™
The STOP.THINK.CONNECT.™ Campaign is a national public awareness campaign aimed at increasing the understanding of cyber threats and empowering the American public to be safer and more secure online. Cybersecurity is a shared responsibility. We each have to do our part to keep the Internet safe. When we all take simple steps to be safer online, it makes using the Internet a more secure experience for everyone.

References:

  1. https://thehill.com/policy/cybersecurity/490232-cyber-threats-spike-during-coronavirus-pandemic
  2. https://www.microsoft.com/security/blog/2020/06/16/exploiting-a-crisis-how-cybercrimincybersecurity-in-the-hacking-age.jspals-behaved-during-the-outbreak/
  3. https://www.key.com/businesses-institutions/business-expertise/articles/
  4. https://www.cisa.gov/cybersummit2020
  5. https://www.stopthinkconnect.org

Digital Pirates Are Hacking Brokerage Accounts | Bloomberg

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“Cyber hacking has now become the biggest threat to investors’ financial well-being.”

Cybersecurity experts say the exponential rise in online stock trading on apps such as Robinhood has created a parallel opportunity for hackers. And even the most diligent traders can fall prey to the increasingly sophisticated tactics of today’s digital pirates.

According to the Financial Industry Regulatory Authority (FINRA), a government-authorized not-for-profit organization that oversees U.S. broker-dealers, cyber threats to brokerage firms are increasing and with these threats comes the increase risk of potential harm to investors. Dangers to accounts include email hack attacks, improper transfer or theft of customer assets, and misuse or even theft of customer data.

“Cyber hacking has now become the biggest threat to investors’ financial well-being,” said Andrew Stoltmann, a Chicago-based lawyer and former president of the Public Investors Advocate Bar Association. “Unfortunately, brokerage firms haven’t invested the money needed in order to keep cyber hacking of brokerage accounts from happening.”

The cyber threat

More believable “phishing” emails, said Jonathan Care, a research director who specializes in cybersecurity and fraud at Gartner, has aided in the hacking of accounts. Such missives might use personal information gathered from publicly visible social-media accounts. They may use the logos of financial institutions to look official to even the most discerning eye enticing unwitting investors may be baited into forking over their log-in information.

Other tactics take place in the background and make legitimate-seeming web activity risky. Some hackers set up WiFi networks in public places with monikers that sound credible — such as the name of a nearby business — which can in fact be used to take control of a system.

Malicious software installed on some machines can detect when users log into financial accounts and even make additional transactions they did not intended to authorize, Care said.

How to protect your brokerage accounts

Digital traders should change their passwords frequently, experts say, and avoid unfamiliar WiFi networks. They should be sure to have two-factor authentication enabled, which requires a secondary code to sign in.

But more than anything else, even savvy users could benefit from simply paying more attention to the flurry of emails, texts and other messages that flood their devices.

Recourse if hacked

Investors who think their accounts are compromised should immediately notify their brokers, who may be able to track down where funds were wired and reverse the transfer. After alerting their brokers, investors may also find it helpful to file a complaint with law enforcement. The most direct way to do that in the U.S. is with the FBI’s Internet Crime Complaint Center.

A common industry practice is to promise to cover 100% of losses as a result of unauthorized activity in a brokerage account. The sticking point, of course, is whether the company will rule the breach was indeed unauthorized or lay the blame on you. Since brokerage firms have a strong incentive to compensate consumers for losses.

“With most of these firms, the judgments are really reputational,” said Adam Fee, a former federal prosecutor in the Southern District of New York who is now a partner at Milbank, a law firm. “When something bad happens, they are asking, ‘Do we want a bunch of articles about how people are out money because we messed up and didn’t react?’”

Practice Cyber Safety

Your online security can be enhanced by doing your part to safeguard your brokerage accounts and personal financial information.

Sound cyber safety tips include using up to date firewall and anti-virus programs on your personal computer, as well as formally logging out of all online sessions related to your account once you are finished. If you use apps on mobile devices to access your financial accounts, be sure to password-protect your device—and make sure you select the highest security setting that the app offers (such as disabling quick access or keeping your account open even if you close the app).

Email awareness is essential. Cybercriminals use a variety of phishing techniques—scams that use spam email or a fake website to lure you into revealing your bank or brokerage account information, passwords or PINs, Social Security number or other types of confidential information.

Beware of emails that request personal information. And, don’t reply to, or click on a link in, an unsolicited email that asks for your personal information. When in doubt, log onto the main website of your bank, credit card company or brokerage firm using the website address that appears on your account statements or credit card—or call your firm using a telephone number you know is legitimate.

Stay Protected While Connected

The bottom line is that whenever you’re online, you’re vulnerable. If devices on your network are compromised for any reason, or if hackers break through an encrypted firewall, someone could be eavesdropping on you even in your own home on encrypted Wi-Fi.

You can protect yourself from online fraud:

  • Practice safe web surfing wherever you are by checking for the “green lock” or padlock icon in your browser bar— this signifies a secure connection.
  • When you find yourself out in the great “wild Wi-Fi West,” avoid free Internet access with no encryption.
  • If you do use an unsecured public access point, practice good Internet hygiene by avoiding sensitive activities (e.g., banking) that require passwords or credit cards. Your personal hotspot is often a safer alternative to free Wi-Fi.
  • Don’t reveal personally identifiable information such as your bank account number, SSN, or date of birth to unknown sources.
  • Type website URLs directly into the address bar instead of clicking on links or cutting and pasting from the email.

Read more: https://www.bloomberg.com/news/articles/2020-10-13/brokerage-account-hack-what-to-do-if-money-in-robinhood-other-apps-is-stolen?utm_campaign=news&utm_medium=bd&utm_source=applenews

STOP. THINK. CONNECT. ™

The STOP.THINK.CONNECT.™ Campaign is a national public awareness campaign aimed at increasing the understanding of cyber threats and empowering the American public to be safer and more secure online. Cybersecurity is a shared responsibility. We each have to do our part to keep the Internet safe. When we all take simple steps to be safer online, it makes using the Internet a more secure experience for everyone.

References:

  1. https://www.finra.org/investors/alerts/cybersecurity-and-your-brokerage-firm
  2. https://www.bloomberg.com/news/articles/2020-10-13/brokerage-account-hack-what-to-do-if-money-in-robinhood-other-apps-is-stolen?utm_campaign=news&utm_medium=bd&utm_source=applenews
  3. https://www.cisa.gov/stopthinkconnect
  4. https://www.cisa.gov/sites/default/files/publications/NCSAM_TheftScams_2020.pdf

Healthy Aging and Lifestyle: Avoid Muscle Loss as You Age

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Declining muscle mass is part of aging, but that does not mean you are helpless to stop it.

“Older men can indeed increase muscle mass lost as a consequence of aging,” says Dr. Thomas W. Storer, director of the exercise physiology and physical function lab at Harvard-affiliated Brigham and Women’s Hospital. “It takes work, dedication, and a plan, but it is never too late to rebuild muscle and maintain it.”

The best means to build muscle mass, no matter your age, is progressive resistance training (PRT), says Dr. Storer. With PRT, you gradually amp up your workout volume—weight, reps, and sets—as your strength and endurance improve.

This constant challenging builds muscle and keeps you away from plateaus where you stop making gains. (See “Working on a PRT program.”) In fact, a recent meta-analysis published in Medicine & Science in Sports & Exercise reviewed 49 studies of men ages 50 to 83 who did PRT and found that subjects averaged a 2.4-pound increase in lean body mass.

if you want to burn more calories and lose weight, the answer is simple: build muscle, according to the Cleveland Clinic.  

Muscle burns more calories at rest than fat

Ten pounds of muscle burns 50 calories at rest, whereas 10 pounds of fat burns 20 calories. This means, long after you’ve stopped working out, your body is still burning over twice as many calories when you’re toned than when you’re not. 

Strength training

When you lift weights and build muscle, you’re actually creating tiny tears in the muscle fibers within your body. This is why you’re sore after a tough workout.

Strength training comes when your muscles build against those tears. athletic trainer Tom Iannetta, ATC, CSCS explains that strength training is beneficial at any age. “As we age, we lose muscle mass, which decreases metabolism, so establishing a strength program will not only increase muscles, it will boost metabolism,” he says. 

Get moving a little every day.

Work out every morning and some evenings. Some moves take just minutes to do. Here’s a few ways to do it right:

  • Start slow—incorporate regular walks or body weight exercises to feel the burn.
  • Workout when you’re working—like with a stressball or a hand grip strengthener
  • Incorporate a complete exercise plan for building muscle. Use it and you’ll avoid back pain and get injured less

A general guideline for improving strength is to exercise each major muscle group at least twice a week. This could be performed as a full-body workout or by doing a split routine performing upper body exercises twice a week, then lower body exercises twice a week.”

Helpful strength training tips:

  • Warm up. Always begin with a light warm-up such as riding a stationary bike or an elliptical machine. Five to 10 minutes should be sufficient.
  • Sets are key. Three sets of an exercise with eight to 12 repetitions has been the gold standard for an effective strength program. However, finding time to exercise may be a challenge.  Recent research shows that many people see results with one or two sets of eight to 15 repetitions of a particular exercise.
  • Push it. Pushing the muscle to fatigue is a key factor. Choose a weight that is heavy enough to fatigue your muscles in eight to 15 repetitions. As exercise becomes easier, you can progressively increase the amount of resistance.
  • Variety is the spice of life … and muscle building. As you get stronger, try varying the exercises you perform. Different exercises or varying the weight training equipment in your routine should keep your program challenging.

The important thing is to find an activity that you enjoy. With consistency, you’ll shed that quarantine weight in no time. 

References:

  1. https://health.clevelandclinic.org/build-muscles-lose-weight-by-adding-strength-training-to-your-workout/?_ga=2.29316282.743021087.1601167027-783556893.1601167027
  2. https://health.clevelandclinic.org/how-can-you-avoid-muscle-loss-as-you-age/
  3. https://www.health.harvard.edu/staying-healthy/preserve-your-muscle-mass

Why so many Americans in the middle class have no savings

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“Millions of  Americans, and not just the working class and poorest among us, struggle to make ends meet.”  Neal Gabler

Middle class families in America are in rough shape. The typical middle class family, according to the Federal Reserve, have enough financial cash reserve to keep themselves afloat for about 3 weeks if they lose their primary source of income.  The biggest reason cited for this predicament is several decades of wage stagnation in the U.S. as worker productivity has increased, wages remained constant and corporate C-suite executives’ compensation have increase a thousand-fold in that same timeframe.

The Federal Reserve conducted a survey to “monitor the financial and economic status of American consumers.” The Fed asked respondents how they would pay for a $400 emergency. The answer: 47 percent of respondents said that either they would cover the expense by borrowing or selling something, or they would not be able to come up with the $400 at all.


(As part of a collaboration between The Atlantic and the PBS NewsHour, Judy Woodruff looks at why Gabler and so many other Americans are struggling with savings.)

Additionally, the Federal Reserve asked Americans if they could come up with $2,000 in 30 days if they had to in case of an emergency. As many as 40 percent of American families can’t, despite the once pre-COVID improving economy.

Owning Stocks, Bonds and Mutual Funds essential to accumulating wealth

In 2020, a Gallup poll finds 55% of Americans reporting that they own stocks, based on polls conducted in March and April. However, a closer look into the numbers reveal that the top 1% of wealthiest Americans own 50% of household equities (stocks, bonds, and mutual funds).  And, the top 10% own a staggering 80% of household equities.

Stock ownership is strongly correlated with household income, formal education, age and race.  In 2020, the percentages owning stock range from highs of 85% of adults with postgraduate education and 84% of those in households earning $100,000 or more to lows of 22% of those in households earning less than $40,000 and 28% of Hispanics.

When you own stock, you own a piece of the company. This means you own a share of the company’s profits and assets. When you own stock, you can grow your money and wealth! There are two ways you can make money with a stock. First, the value of your ownership stake can go up or appreciate in value. Second, some stocks pay dividends too. Dividends are company profits that some companies distribute to their shareholders.

Why Own stocks

Stocks are one possible way to invest and grow your hard-earned money. And, according to Morning Star, savvy investors invest in stocks because they provide the highest potential returns. And over the long term, no other type of investment tends to perform better.

On the downside, stocks tend to be the most volatile investments. This means that the value of stocks can drop in the short term. But you can minimize this by taking a long-term investing approach.  Yet, there’s also no guarantee you will actually realize any sort of positive return.

By educating yourself and increasing your investing knowledge, you can make the risk acceptable relative to your expected reward. And, investing in stocks is well worth it, because over the long haul, your money can work harder for you in equities than in just about any other investment.

Financially Unstable

“Gold is the money of kings, silver is the money of gentlemen, barter is the money of peasants and debt is the money of slaves.”  Unknown

Financial illiterate pay a hefty price for not having basic financial knowledge.

  1. https://www.theatlantic.com/magazine/archive/2016/05/my-secret-shame/476415/
  2. https://ritholtz.com/2020/01/stock-ownership/
  3. https://news.gallup.com/poll/266807/percentage-americans-owns-stock.aspx

Healthy Aging and Lifestyle: Whole Foods, Plant Based Diet | Consumers Report

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“It’s never too early or too late to embrace a healthier lifestyle.” Robert Ostfeld, M.D., director of Preventive Cardiology and founder and director of the Cardiac Wellness Program at Montefiore Medical Center in New York

A strong body of research supports the idea that a whole foods, plant-based diet can boost your health, decreasing the risk of heart disease, type 2 diabetes, and certain cancers, and helping you stay at a healthy weight. It can even lengthen your life, according to a recent study in JAMA Internal Medicine that tracked more than 70,000 people.

Scientific research highlighted in the landmark book The China Study shows that a whole food, plant-based diet can reduce the risk of type 2 diabetes, heart disease, certain types of cancer, and other major illnesses. Many people also reported bigger fitness payoffs, more energy, reduced inflammation, and better health outcomes after making the switch.

You can eat to be younger

Whole Foods, plant-based diets are also full of phytochemicals, compounds that help keep many of your body’s systems running smoothly, Rachel Meltzer Warren, M.S., R.D., a frequent contributor to Consumers Report, wrote. For instance, the anthocyanins in berries help protect vision; carotenoids in carrots and cantaloupe, and the isothiocyanates in brussels sprouts neutralize the free radicals that cause cell damage; and flavonoids in apples help control inflammation.

A whole-food, plant-based diet is based on the following principles, according to ForksOverKnives:

  • Whole food describes natural foods that are not heavily processed. That means whole, unrefined, or minimally refined ingredients.
  • Plant-based means food that comes from plants and doesn’t include animal ingredients such as meat, milk, eggs, or honey.

A “less meat, more plants” style of eating can also help improve the quality of your life

Research shows in one recent preliminary study of more than 450,000 adults, those who followed a whole food, plant-based diet that was 70 percent plants had a 20 percent lower risk of dying from heart disease or stroke than those whose diets centered on meat and dairy. A Harvard study that tracked more than 120,000 people for 30 years found that those who ate the most red meat tended to die younger during the study period but that swapping just one daily serving of beef for nuts could cut the risk of dying early by as much as 19 percent.

One possible reason for those benefits is that a whole food, plant-based diet can improve blood lipid levels. Making the change from a standard American diet to a whole food, plant based (including some meat) or vegetarian one was associated with a 10 to 15 percent decrease in total and LDL “bad” cholesterol, according to a review of 27 studies in the American Journal of Cardiology. Shifting to a vegan diet led to even more dramatic change.

A “less meat, more plants” style of eating can also help improve the quality of your life. In addition, it’s associated with higher levels of short-chain fatty acids in the gut, and research suggests that it lowers the risk of heart disease, inflammatory diseases, and type 2 diabetes.

Wake up and go to work on yourself before you go to work for anyone else

Changing your diet after age 50 can make a difference, according to experts. “It’s never too early or too late to embrace a healthier lifestyle,” Robert Ostfeld, M.D., director of Preventive Cardiology and founder and director of the Cardiac Wellness Program at Montefiore Medical Center in New York says, which includes a healthy whole food, plant based diet, aerobic and resistance exercises and good nights sleep. “The benefits come quickly and continue to accrue with time.” In one study, women in that age group who ate a mostly plant diet were 34 percent more likely to be free of chronic diseases, like type 2 diabetes and heart disease, 15 years later than women whose diets included more meat.

Essentially, a whole-food, plant-based diet is good for your heart, your body, and it may even be good for your soul.

References:

  1. https://www.consumerreports.org/diet-plans/plant-based-diet/
  2. https://www.forksoverknives.com/how-tos/plant-based-primer-beginners-guide-starting-plant-based-diet/
  3. https://www.forksoverknives.com/wellness/patient-lost-75-pounds-reduced-nineteen-meds-three/

Healthy Plant Based Diet, Aerobic and Resistance Exercises and Restful Sleep