AS WE CELEBRATE Thanksgiving, I’m reflecting on what I’ve learned over the past year or so from HumbleDollar—both as a reader and as one of the site’s writers. An article I wrote about claiming Social Security bounced back and forth a few times between me and HumbleDollar’s editor, Jonathan Clements. The breakthrough came when Jonathan referred me to a free online calculator built by financial blogger Mike Piper. I’d been trying to do my own calculation in Excel. Working through the calculator greatly reduced my anxiety about picking the right date to pull the Social Security trigger. I realized that a wide range of dates were pretty much equally good. Meanwhile, an article by Charley Ellis helped me rethink my asset allocation. The key insight: Predictable income such as a pension and Social Security can be considered part of your bond allocation. This gave me the comfort to increase my allocation to stocks. Luckily, this past year has been an good time to add to my stock holdings, thanks to the market decline. Other pieces on the site prompted me to rethink how I invest my cash. John Lim’s article was the first place I read about the handsome yield available from Series I savings bonds. His article led me to open a TreasuryDirect account, so I could purchase I bonds. That account came in handy when a reader, in response to one of my articles, suggested I consider Treasury bills as an attractive alternative for my cash investments. Not every insight is life-changing. Finding ways to tweak my personal finances can be just as satisfying. Jonathan had an article on check washing that opened my eyes. I’ve had my own frustrations with the post office, but I didn’t fully appreciate the risk of sending checks through the mail. Based on…

IN PROFESSIONAL sports, superlatives are often overdone. Even the GOAT designation—greatest of all time—is sometimes applied prematurely. But love him or hate him, Tom Brady is arguably the GOAT among NFL quarterbacks and perhaps among all NFL players. For proof, look no further than his collection of record-breaking statistics, Super Bowl rings and most valuable player awards. Could it be that he has added another GOAT designation with his epic fail at retirement? Brady reversed his retirement announcement from the Tampa Bay Buccaneers after just 40 days. What did he figure out in those 40 days that changed his plans? The Bureau of Labor Statistics says the median NFL player career is six years. Brady has played for 22. Didn’t he know that retirement was coming? Maybe it’s a matter of finances. Despite earning in a few years what most people earn in a lifetime, an unfortunate number of NFL players file bankruptcy after their football days are over. Tom and his wife Gisele reportedly have $26 million worth of homes in various states. Perhaps they neglected to factor the mortgage payments into their retirement plan. Maybe they miscalculated how much early retirees pay for health coverage. Perhaps they forgot to fund 529 plans for the kids’ college. Still, with a reported individual net worth of $250 million, coupled with his wife’s $400 million, I’m guessing Brady doesn’t need the paycheck. In a HumbleDollar article last October, Mike Drak described “failing” retirement because he didn’t recognize in advance what retirement would mean for his identity and sense of purpose. For Brady, maybe we shouldn’t discount the feeling that comes with having millions of fans scream his name at every snap. Brady’s stated reason for reversing his retirement decision was “unfinished business.” The fans take this to mean he wants another…

WANT A CONSERVATIVE strategy that can help you prepare for college costs? Consider prepaying your mortgage. In 1992, when my oldest was 10 years old, we moved to a new home. We opted for a 15-year mortgage at 7.625% with 33% down. With our son’s graduation set for 2000, we began to prepay the mortgage so the last payment would coincide with the month before he began his freshman year. Thereafter, the payments previously sent to the mortgage company were instead directed to the college. Our aggressive repayment plan was made possible by buying enough house for our needs but less than we could afford. On top of that, the large down payment ensured that the required monthly payments were relatively low. Financial planners might say a better strategy would be to take out a 30-year mortgage with, say, a 10% down payment and then pay only the minimum required. The notion: You could take the money that isn’t going to the mortgage company—the difference between the 30-year loan’s smaller down payment plus lower monthly payments and the 15-year mortgage’s larger down payment and higher monthly payments—and instead invest in the stock market. As it turns out, I was able to make a direct comparison of the two approaches. We had money provided by a grandparent for our son’s college, which was invested in a stock mutual fund. For most of the 1990s, it looked like a great strategy. Then the dot-com bubble burst and a big chunk of the fund gains were erased just as college was starting. Meanwhile, the money prepaid on the mortgage effectively earned 7.625% a year. What are the lessons here? With a long time horizon, mortgage prepayments aren’t that burdensome. Imagine a family buying a home with a 30-year mortgage when their first child…

MY CAR EMAILED ME to say its tire pressure was low. Perhaps it’s more accurate to say it this way: An email from Subaru was triggered by data uploaded from my 2020 Forester, all part of the automatic safety and maintenance technology built into the vehicle. The email confirmed the dashboard light indicating the same problem. My frugal friends and I have had friendly debates about car buying. Is it better to buy a used car and avoid the instant depreciation when you drive off the dealer’s lot? Or should we pay more to purchase a new car, with a plan to drive it for many years? This same debate was featured in the book The Millionaire Next Door by Thomas J. Stanley and William D. Danko. Their research for the 2010 edition found that the millionaires surveyed were split on the issue, just as my friends and I are. The book said 63.4% of millionaires were buying new, versus 36.6% choosing used. Historically, I’ve bought new vehicles. The Subaru replaced a 2008 Mercury. Our second car is a 2010 Honda. Like the Subaru, we purchased both the Mercury and Honda new. I dislike the car-buying experience, so I want our vehicles to last. I buy new and keep up with routine maintenance to delay the need to replace them. My push to shop for a new car in 2020 was because of the new safety technology now available. Many studies have shown that 80% to 90% of Americans feel they’re “above average” drivers—a statistical impossibility. Based on my wife’s reactions in the passenger seat, I’ve concluded that I must be average at best. When Consumer Reports began touting the many safety improvements available today, I couldn’t ignore the opportunity to improve our safety. After buying the Forester, I became…

As an AARP volunteer Tax Aide for a second tax season, I completed about 100 returns and reviewed many others prepared by other volunteers. I volunteer two days a week from February 1 to April 14 at two different senior centers and continue to make observations based my clients’ tax situations. The Tax Aide program is free and not limited to seniors or AARP members. Even though most clients are retired seniors, we can serve all ages and incomes. Only more complex returns are out of scope. It is not unusual to be helping someone whose spouse has recently passed away. I had a couple of situations where the death was in 2023 which had allowed them to continue to file “married filing jointly” last year. As I prepared the 2024 return, they were hit with the implications of now filing “single.” Their standard deduction is essentially cut in half. If their income and withholding stayed the same, this meant a big tax bill. This led to difficult conversations where I explained that: 1) they had to come up with the money to pay this year’s taxes; 2) they were potentially on the hook for penalties associated with under withholding because they owed more than $1000; and 3) they had to consider increasing withholding for the current year to avoid a penalty next year. As many of our clients have low incomes, these prospects were daunting. If I saw someone where the spouse died in 2024, I was able to counsel them to increase their withholding now so they did not get caught short next year. I saw a smattering of W-2G forms. These represent gambling winnings, usually from one of our local casinos. Not surprisingly, the state and city have taken their cut and this is disclosed on the…

OUR HIGH SCHOOL principal returned from a teacher recruitment fair and announced to the school board, “Tell your children or grandchildren: Do not get a degree in elementary education.” He went to the recruitment fair looking to hire some very specific specialty teachers for the high school. He mostly met new grads with credentials to teach elementary school—who were looking for jobs that simply don’t exist in our region. Our superintendent explained that our region had several large, well-known schools of education that turned out far more teachers than were needed locally. But he also noted that this was not a national issue. Ample signing bonuses were available for elementary school teachers in high-growth southern and western states. New college grads are living in Mom and Dad’s basement because the degrees they earned didn’t translate into jobs. Career planning, preferably conducted in high school, should include an understanding of in-demand jobs. There are certain jobs where the openings greatly exceed the supply and where future growth is expected. In many cases, these in-demand jobs don’t require a college degree—and yet they’re more lucrative than many jobs that do. In our heavy-manufacturing area, employers are begging for welders and machinists. Skilled trades are another in-demand route. As the elementary school teacher issue shows, “in demand” can vary geographically. As young people think about their career, they need to honestly assess where they’re willing to live. If they’re truly willing to move, it opens up more opportunities. For instance, there might be a huge need for aerospace engineers, but there are just a few specific areas of the country where those jobs will be plentiful. In Ohio, where I live, the state jobs agency, Ohio Means Jobs, points students and adults to in-demand jobs in our state. Web searches can yield similar…