How To Resell Clothes: Ebay, Poshmark and Mercari

How To Resell Clothes and Get Rid Of Clothes
How To Resell Clothes and Get Rid Of Clothes

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I’ve been going through a phase of cleaning out my closet to get rid of extra clothes. OBSESSIVELY. I literally wear maybe 10% of my clothes. And I think most of us are like that. We buy something maybe we wear it once, or there’s some feature that we just didn’t like about it and then we never wear it again. We hope we might but we never wear it again. I have so many things that I do this with it’s not even funny. Clothes, shoes, jewelry, random knickknacks, you name it. I’m also the type of personality that enjoys going to fleamarkets. I enjoyed sifting through racks for hours and then trying to get the best price. So of course I really enjoy the whole reselling used clothes/items thing that’s going on right now and wanted to learn how to resell clothes on eBay, Poshmark and Mercari.

And it seems like there’s more people buying used clothes. The public is more aware of how devastating the fast fashion industry has been on our environment as well as the wastefulness of constantly buying clothes. So in a way, buying used clothes, as long as they’re in good condition, is fine.

So here is my review on the three platforms (ebay, Mercari, Poshmark) and how to resell clothes on them. So far I’ve sold 3 items in 2 weeks!

eBay

eBay, oh eBay how I love you. Literally the OG of all reselling companies. I started dabbling with online selling in 2016, just selling a few things that were in my closet. Now here I am again, trying to learn how to resell the clothes out of my closet and maybe more if it works out.

The positive of selling on eBay is that it is a MASSIVE platform to sell to people. Since it’s older than both Mercari and Poshmark, it has more pull in terms of being the most familiar. The only issue I have with it is the auction feature. Of course eBay sold itself as being an online auction house first for basic things like electronics, games, clothes etc. And people are very used to getting REALLY good deals from this. In other words, the users are really cheap. Which is fine if you have the right product and can price it low enough.

For me, I’m selling clothes and some jewelry that I’ve already worn so I don’t need such a high markup. I’m pricing most of my clothes at $10-$40 depending on how worn they are or if it’s new with tags.

I didn’t use Ebay’s auction feature but did use it’s “buy now” feature. Here I can set the price, determine shipping costs and describe the item. They have this new option to “promote” where for an additional 10% fee you can get the listing promoted. They also take 10% fee when it sells. After 50 zero insertion fee listings, the insertion fee is $.35.
For the most part, this seems reasonable. I don’t opt to promote it because traffic on eBay is wonky. Sometimes an item will be priced well and sit, or sometimes priced high and move. If someone wants your product, they’ll buy it or at least send you an offer.

The one item I sold on eBay, someone submitted an offer. And since I wasn’t losing money, I took it. I just wanted to get rid of the clothes.

Shipping is probably their best feature. After you’re done selling, you just ship it off using their prepaid shipping label. Their vendor is USPS, it comes with tracking and I find their rates VERY competitive. So for the most part you don’t have to worry about shipping. I don’t include shipping in my listings but I never charge higher than $4.99. Pretty much the best place to start if you want to learn how to resell clothes.

Mercari

This is a very similar website to eBay. I mean, other than not having an auction feature, they’re almost identical. It’s basically the “Buy Now” feature only.

I did find that the traffic there is a little bit better for clothes whereas, EBay it was limited. Views kind of trickle in on eBay.

One main difference is in promoting your listing- just lower the price. The new listings show up on the top of the search but discounted ones get kind of a refresh button and show up on the top too with a down arrow indicating prices are dropped. This type of promoting definitely encourages people to kind of wait and see if prices lower. HOWEVER, there is a “like” feature similar to eBay’s “watching” feature that allows buyers to know if there are other interested buyers. This can create a sense of urgency that could help move a listing along and get rid of clothes that you’re selling.

I sold one item on Mercari and would rate the the shipping as fair, not too expensive but not as good as eBay. For some reason, I feel compelled to offer free shipping on products. That probably plays into why I get a little more views on Mercari than I do on eBay. Sales-wise they’re pretty equal. Fee-wise similar to eBay with 10% commission and no listing fees.

Payment processing is a bit different. eBay indicates the payment has been made immediately, and if there are any issues buyers can dispute after. Mercari only shows payment once the buyer has received the item. And then they have 3 days after delivery to confirm the product is as described and it was delivered. If they don’t, the funds get automatically deposited to the seller’s account.

Honestly not sure how I feel about this. Because I’m only selling small items and clothes, this doesn’t feel too risky. If I was selling electronics, I think it would cause issues to delay payment like that.

Overall a good platform that compliments eBay.

Poshmark

I have yet to get a sale here, but I’m giving it an honest chance because I really want to know how to resell clothes on this website.

Overall, it’s definitely a more social platform. Poshers (aka sellers) have to share each other’s listings as part of the platform’s structure. There’s also a follower and following section of your profile that is above your listings. I’ve been on Poshmark for less than 2 weeks and I have over 4K followers. It’s customary to follow back here. There are tons of sellers that have over 100K followers and following.

Because of this social aspect, it’s more time consuming.

But there’s definitely a hustle to this platform.
Like both eBay and Mercari, you can cover shipping, offer discounts, etc., but on Poshmark you can suggest an item if someone has something of yours in their bundle (shopping cart). This is how you can sweeten the deal. You can offer an addition item be taken with a 5% discount and also offer to cover part or all of the shipping. It’s a sweet deal for them and sweet for you.

However, Poshmark has to be the more expensive platform of the 3 with a 20% commission fee and a buyer shipping cost of $6.79. That $6.79 shipping cost the buyer has to pay will in turn make them more price conscious and the 20% cut that the seller has to pay makes the products more expensive.

I do believe that the clientele on Poshmark is willing to spend and, in a way, they’re more stylish. Unlike eBay and Mercari where you can sell anything, Poshmark is only clothes, shoes, accessories, makeup, and perfumes. It’s rare to see anything outside of that there. Since the clientele is more stylish, they’re going to appreciate good marketing and will likely pay more for it. At least you can get rid of clothes and make a pretty penny from it.

I don’t know much about their shipping because I haven’t sold anything yet.

I will definitely keep Poshmark in my pocket as a contending selling platform.

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Overall I think you can make a killing reselling and get rid of clothes in the process. The most important thing is to work all 3 of these platforms. The likelihood that an item will sell on 2 or all platforms at the same time is rare (as long as you price correctly), in which case you can cancel a sale on one of them, but using all 3 makes it easier to get your items to a buyer who will love it.

Hope you enjoyed this guide on how to get rid of clothes by reselling. Happy selling!

If you like “How To Resell Clothes: Ebay, Poshmark and Mercari” check out my other posts!

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The Rent vs Buy Argument

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Amazon’s “Subscribe And Save” Program Will Save You So Much Money

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Photo by Christian Wiediger on Unsplash

I’m a huge lover of Amazon. It’s probably the place I shop most. My bank account statements are literally lined with Amazon, Amazon, Amazon.

The Amazon Prime subscription is pretty awesome and I find myself relying on it more with every year that passes. I secretly hate trips to Target and if I know what I want to buy, why not just buy it online?

A bit of a caveat, not everything on Amazon is a worth buying. One of my most recent Amazon mistakes was buying food type items. No I haven’t tried Amazon Fresh, I think that’s a completely separate category, but I have tried buying in bulk Miss Vicky’s jalapeño chips from a 3rd party vender. I love them so much! I ended up buying like 40 in a box and tell me how they ended up with expiration dates that ended the following month? How am I supposed to eat 40 bags of jalapeño chips in a month? ??

I also made the mistake of buying 16 kinder eggs because my daughter loves them and I want to give them as a reward for doing homework. Tell me how their expiration date was for the following week? Why would I buy these from that seller again? I’m not going to give my daughter 16 Kinder Eggs in a week!

So you have to be careful with certain things because Amazon is still a place where people sell wholesale and sell leftover inventory when they can’t sell in their brick and mortar store. It’s just one caveat.

But I still opt for the Amazon “Subscribe and Save” purchases. These items are not going to expire as easily as food stuff so it makes sense for me to buy them in bulk or buy them on a regular schedule so I can get the discounts. When you do Amazon “Subscribe and Save” you can get either a 5% discount for subscribing to buy an item or you can get 15% off if you have five or more items subscribed for delivery that month.

For example, May I ordered five different household items so I was able to get the 15% discount that whole order. But in June, I had only three household items subscribed for delivery to so I was only able to get the 5% discount.

Any discount is better than no discount, but I usually try to arrange my purchases so that I can get 15% off my order every month. That means every month I’m getting five different items that I can subscribe to through Amazon. The nice thing is that you can move orders around so that you can meet your 15% discount with the five item minimum easier.

I would recommend going for items that are not going to expire easily, that you need on a regular basis and are easy to ship. Things like soap, diapers, baby wipes, shaving cream, lotion and shampoo are great examples.

So what am I ordering every month? On my subscription list are the following items:

Those are just some of the things that I like to buy from Amazon. Just know that they’re mostly household items that can fit in your closet for a few months and non-perishables. The subscribe featured items are also constantly being shipped to other people, so they’re less likely to be stale.

And of course this is all predicated on the fact that I have Amazon Prime, which I think I pay $13 a month to get free shipping on all Amazon Prime items. Totally worth it especially with the new Subscribe and Save feature. With a 5%-15% discount, these items are highly competitive with any other store pricing.

If you don’t have it already, definitely sign up for Amazon Prime, right now they’re offering a 30 day free trial for those just starting out! I would recommend giving it a try and mixing it with buying items through the Subscribe and Save program, it basically pays for itself! I hate making Target runs mainly because of how busy the store near me usually gets and how disorganized they are. Amazon is a deliver to your door type of service.

I used to worry that someone would steal my package but I honestly never had a bad experience with ordering through them. Their customer service centric policies are what make them an amazing business model. And they have no issues with refunding if you have a bad experience.

So would definitely recommend using Amazon as part of your grocery/household shopping arsenal. You can definitely work it so you’re saving on things you need and in bulk. At which point, the cost of Amazon Prime pretty much pays for itself.

Happy Shopping!

The Rent vs Buy Argument

With my whole mold dilemma going on it has me revisiting the idea of buying.

I’ve been in the real estate business for about seven years now doing mainly rentals and I’ve always thought that buying and renting are personal decisions. For the most part they are, but with everything happening in my life right now, I’m leaning towards buying.

I’d say it’s also heavily dependent on your financial situation. For some, renting is the only option.

Here Are The Benefits Of Renting.

1)It’s Flexible.

I like the idea of having a lease that’s short term. Either 6 months, 1 year or 2 years, it’s nice to know that you’re not fully committed to a property. I can leave at the end of my lease if I’m unhappy or if it becomes too expensive. You can usually leave mid-lease if you’re able to find a takeover tenant that qualifies. Overall, I believe that the flexibility is great for people who travel for their job, relocate or need something that offers financial flexibility. (Example: if you work on commission and earnings change year to year)

2)Initial Costs Are Low.

Most of the time you can find an apartment without a broker by contacting the property management directly. Websites like Apartments.com, Zillow and Trulia make this possible.

Even if you have to pay a brokers fee, it’s usually no more than 1 months rent. Up front fees include security deposit which could be as low as $500 to 2+ months of rent.

Compare that to your closing costs which are 2%-5% of a homes value plus a 20% down payment! Not everyone has that kind of money available.

3) Allows You To Stay Liquid.

And that brings me to my next point, if you’re you’re able to put together a down payment and closing costs, that means you have the financial opportunity to pursue other investments.

Generally it’s said that a home isn’t a good investment. The only value you really get is a roof over your head at a somewhat stable cost. It gains an average of 4-6% value each year depending on your location and that’s with inflation plus the updates you’ll need to put into it. Compare that to the stock market, the Dow Jones historically has gained 8-9% each year. So stock would be a better return but is more volatile than buying a home.

Pitfalls To Renting

1) Neighbors

Generally, you’re not in control of who your neighbors are and they are a lot closer to you when you’re renting. Renters usually are in apartment buildings where neighbors are sharing walls and tight living quarters. If you buy, you can choose the neighborhood and even a property that is more isolated with less risk of a nuisance neighbor.

2) Absentee Landlord.

The owner of a rental is obligated to make the apartment habitable and make reasonable repairs to the apartment. Somehow that doesn’t motivate some management companies to act correctly and do basic work like fixing leaky pipes or sealing drafty windows. I would say most landlords, even those with massive wealth, would rather wait for the attorney letter demanding repairs than make major repairs of their own free will. Repairs tend to cut into their profit and they hate that.

The Benefits To Buying

1) Tax Incentives

The tax incentives for buying a home and getting a mortgage are pretty nice. It’s almost like a rebate on part of your purchase, that’s how good of an incentive it is. You can write off your closing costs, mortgage interest, and any major repairs on your house. My dad once told me his housing tax incentive was equivalent to a $6000 tax credit.

It’s also a great way to shield your income from tax obligations if you’re in a higher tax bracket.

2) Control Over The Property

As I learned with my whole mold situation, I have no control over my environment as a renter. Mold is literally growing underneath my floorboards and I had no idea and no control. When issues arise, the landlord can choose how they want to fix problems and sometimes they go for the quick fix.

By owning a home, you have complete control over the property. And can choose the best and most efficient option to repair. You can do your own repairs, if you’re skilled enough, and you can make changes to the finishes as you wish.

3) Building Equity

Like I mentioned before, buying a home isn’t the best option for an investment when you’re looking for a high return but you’re still building equity and personal wealth by paying off the principle of your mortgage.

There is some flexibility if you want to increase your liquidity for investments or capital ventures but they involve more risk. Once you’ve paid a significant enough percentage of your principal balance, you can apply to refinance and get a personal loan, apply for a line of credit against your home or for a second mortgage. This is a bit more risk, since defaulting could result in foreclosure, but this allows banks to lend money to you at a better and lower interest rate.

Pitfalls To Buying.

1) Fluctuating Costs

The nice thing about renting is that you always know what your rent is going to be. It’s not a surprise and any repairs that need to be done, the landlord is supposed to be able to fix. Housing costs for a renter should remain stable.

Compare that to a home, which depending on the condition you bought it in, may have some major renovation costs down the road.

My parents have owned their house since 1991 and I’ve watched them pour money into it like it was a bottomless pit. Over the 30 years they’ve owned their home they’ve done a bathroom renovation, built a bathroom out, windows replacements, insulation installments, kitchen demolition and renovation, roof work, landscaping each summer, boiler replacement, basement refinishing, installed backyard and front yard pavers, tree removal, central air installation and bought new laundry appliances. This is an exhaustive list.

After all that work, I don’t feel like my parents came out with much of a profit. There were definitely months where they had to go into debt or take loans to make these payments. They bought their home in 1991 for $190K and it’s probably worth $450-500K at this point. But with 30 years of inflation and renovation costs, it’s not a particularly great deal.

2) Less Flexibility

Because the initial costs to buy and sell a home are so high, including closing costs and broker fees, buying a home is impractical if you plan to move within 5 years.

A home is more of a long term investment just to break even with the costs.

If you’re a person that’s constantly relocating or unsure of where you’ll be in 5 years, renting is a better option.

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Overall, for me the choice seems to be leaning towards buying. The uncertainty of renting is starting to wear on me.

Buying is one the biggest financial decisions of your life so take your time and weigh all the options.

Here’s a great buy versus rent calculator. You can find out which is a financially better option. I’ve always used it to consider whether my apartment was a good deal.

Happy real estate shopping! 🙂

Marriage, Finances And Money: The Benefits And Pitfalls

The bride counts the money. Wedding expenses. Bride with a piggy bank

When we think of marriage, we think of wedding bells and dresses, flower girls and ring bearers, and a couple expressing their everlasting love to one another.

No party is as fun as a wedding and very few life experiences can alter your life in such a meaningful way.

I’ve written a few posts on love and relationships but I don’t think I need to remind anyone that there is a financial consequence to marriage.   In fact, I think most of us consider FIRST the tangible benefits of being with a partner more than the intangible aspects like character, honesty, integrity etc.

A perfect relationship is a balance of the two. A perfect compromise of tangible and intangible benefits. I’m going to talk about the financial pitfalls and benefits that come from marriage.  In this post, I’ve discussed some of the more intangible benefits.  Sometimes money and relationships can mix like oil and water.

Benefits:

1. Sharing expenses in a relationship and couple finances:

Definitely something couples discuss when moving in together but when married, you need to take it to the next level. It goes beyond utilities, rent and groceries. It’s time to talk about retirement, spending habits, saving and buying a house.

Two people are better than one in this type of division.

To give you an example, imagine this scenario:

Jim lives on his own, he rents a $1400 one bedroom right outside of NYC. He has one car. He pays $300 between payments and insurance. Groceries cost him about $200 a month but he orders out a lot so it adds up to an additional $200. His utilities for electric and internet cable are $150. On the weekends, he likes going out to dinner/drinks with friends. His entertainment spends are around $300-$400 a month.

Jim works as a IT tech earning 75K annually or $6250 monthly. After taxes he brings home $4275.

Take home income

$4275

Minus

Expenses

-$1400 apartment

-$300 Car

-$400 Food

-$150 Utilities

-$400 entertainment

-$600 Misc.

Net savings to go toward personal savings, 401K and Medical savings accounts.

$1175

*This is a very simplified budget but you get the picture.

Now let’s look at Jane and Sam.

They are newly married. Jane works as a teacher and makes 40K. Sam works in construction and makes 60K between hourly and overtime. They live in the same apartment building as Jim and pay 1400 for rent. Actually their spending is almost identical. They spend 600 on food, share a car for $400, $150 on utilities and spend 600 on entertainment and $600 on misc.

Together they bring in $8333, after taxes it’s an estimated $5,833.

Take home pay

$5833

Expenses

-$1400 apartment

-$400 Car

-$600 Food

-$150 Utilities

-$600 entertainment

-$600 Misc.

Net Savings for personal savings, retirement and medical savings:

$2083 or $1041 per person.

The point of this example is that even though Jane and Sam both make less then Jim, their still able to save roughly at the same rate each because they are pooling together for their major expenses and budgeting as a couple.  This is one of the best financial things to consider when either moving in or marrying.  The couples budget is everything and couples who are able to leverage their joint spending will come out on top in the long run.

2. Sharing Manpower.

They say two people are better than one.  And I would say that when it comes to domestic tasks, couples find that they are able to get more free time by splitting it up.

I’m not sure this is the biggest financial benefit to being married but it can definitely pinch a few pennies and save a lot of hours.  Having an extra pair of hands  for 1) doing laundry, 2) cleaning, 4) grocery shopping, 5) cooking meals for the week, 6) bargain shopping can add up to a lot of savings.

A single person only has so many hours available them, they have to either do these tasks themselves and lose some free time or pay a 3rd party to handle these tasks like a housekeeper, or eating out/ordering in, wash/fold services, and food delivery like FreshDirect.  They can either keep their free time to themselves to do other endeavors or pay for these conveniences.

3. Spousal Employment Benefits.

One of the biggest is insurance.  You can’t really quantify how important insurance is until you don’t have a job that offers it to you.  Then you’re either paying hundreds out of pocket just to get simple blood work done or you’re paying $500+ premium for a private insurance for married couples that still has a large deductible or copay.

One benefit of being married is that health insurance for married couples is generally cheaper than paying health insurance for two single people.

Being able to add a spouse to your work insurance is amazing and something only allowed for immediate family members/dependents by most insurance carriers.

For my Husband and I, we’ve always had insurance that covered us through work.  But there was this one year that we had to go without and that was the sketchiest year I ever went through.  We never went to see the doctor because it was too expensive and we prayed neither of us were ever involved in an accident because how could we ever pay?

My job also has some married life insurance benefits that if I die, K get’s X amount and if K dies I can get X amount.  It’s comforting to know that we’ll have some fall back if (God Forbid) either of us ever pass away.

Pittfalls

1) Spending habits

Sometimes people can get so caught up in the love and the connection they have for the other person, that looking at habits like spending can seem like a non-issue.

You might look at someone who never seems to wear the same piece of clothing twice and never wonder how they can afford to such a large wardrobe.

You might see someone drive an Audi and not realize that their car payments are near $500 a month and it’s a squeeze with all their other expenses.

It’s not until YOUR money is commingled with your partner’s that you start to realize how small spending habits can add up to big expenditures.

For a long time my husband liked to play poker with his friends. He became so good his friends stopped playing with him. It was always, “maybe next time.” They were scared to lose money to him.  Eventually he joined some poker clubs in the city and played there once or twice a year. Then he found some casinos near us that offered poker comps and he would go occasionally there too. He loved the game of poker but it was bleeding us $500-$1000 every time he lost.

Thankfully he doesn’t play anymore, we had a pretty serious conversation about his gambling and now I have complete control over the cash. But it just goes to show how a small insignificant habit can turn into a ravenous expense.

The same story could be told with shopping addicts or forever entrepreneurs who can never seem to get their business off the ground.

The solution is to think long range about how your finances with your partner would work and weeding out financially incompatible partners out. In my case, I nipped out early what was potentially a serious gambling addiction.

I would recommend financial planning for couples before getting married.  Sometimes when things feel out of control, it’s great to consider a financial planner for financial help with married couples.

Expensive Wedding and Even More Expensive Divorces

“My husband and I, fight over money.”

People spend an average of $27,000 on a wedding.  Those are pretty expensive parties.  I don’t have anything against big fancy parties to celebrate the joining of a couple but when we start to look at divorce rates, those big weddings start to look like a waste.  It’s estimated that nearly 40%-50% of marriages end in divorce.  According to an article written by CNN, couples that spent more than $20K had a divorce rate of 1.6X more than those who spent only $5K-$10K.

In some ways marriage is a crapshoot, you can never know if some devastating skeleton is going to come out of your partner’s closet and change your whole relationship with them.

It’s when you consider that the average divorce costs $15K, marriages have a risk of being a financial hole once everything is said and done.

Then Add Children and Divorce

If your divorce included children, then there will likely be one party that pays child support.  There will still be an increase in housing costs because the divorced couple will need separate places for themselves and for their children.

It can be very costly and difficult to manage your time and finances when expenses increase and resources are nearly cut in half.

Unfortunately in some cases, divorce is the only option for two people who turn out to be incompatible to stay sane and happy.  But children can definitely make divorce messier and more expensive.

I’m not writing this section to make children sound like a burden but for the most part, nobody has children to make a profit.  They have children for the generational and personal wealth that it brings to a family.  We grow our family to keep tradition and create memories.

Nothing brings a family together like children, but nothing makes it harder to separate and divorce cheaply than children.


 

I would say marriage comes with a lot of different types of benefits but something we should never take our eye off of is the financial outcomes that can result from saying “I Do.”  Ignoring that important fact can lead to marriage troubles over money.

On the other hand, marriage can be a blessing that can pay itself back in ways that can’t even be accounted for.  For many, the risk is worth taking.

I hope you read this with hope in your heart and practicality in your mind.

Feel free to read my other relationship posts:

The Biggest Red Flags In A Relationship

Why Dating Culture Doesn’t Work Towards Marriage

Dear Single Friends, This Is Why You Are Still Single. Love, Your Married Friend.

I Can’t Afford To Retire: Essential Tips On Filling The Gap

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I was on Reddit r/PersonalFinance last week, I was just browsing when I came across this  quote:

“There’s no insurance, no loans for retirement.”

If you’re short on cash to retire, well then you’re just SOL.  Straight up, prepare to be homeless if you don’t have family to help you out or are unable to continue working through your 60s and 70s.  It’s a rude awakening for so many of our elderly population.  I see older homeless people all the time and I wonder, “Why???”

When I think of my own retirement, I think about living in Florida, poolside somewhere in some assisted living luxury community.  I don’t think about the reality of just trying to keep my food costs down so I can pay the taxes on my house and not end up homeless.

The truth is that so many American families are living hand to mouth, check to check, that they are forced to decide between eating and saving for the future.  Where is the extra disposable income they can put in their 401K or IRA?

Here are some things to consider when trying to build a retirement fund.

Social Security Will Not Be There:

There are still some people holding on to the idea that Social Security will be enough. STOP IT.  There is not enough social security.  It is a Ponzi scheme.  And to be honest, to be a real conspiracist, Social Security’s main role is no longer to provide financial support for the elderly and other people unable to provide for themselves.  I mean, maybe that was never the purpose.  Social Security and their designated numbers are a means to track you for tax collection purpose.

I work with many elderly people to get them apartments and when I see their social security statements, I can’t even consider that income for the purpose of qualifying them for the apartments.  It’s a pitiful amount.

The other day my client Jenn had 1.4M between annuities, 401K and other investments.  She was sharp, I could tell she had been working her whole life.  She was earning $819 dollars a month from Social Security!  Try living in NYC with $819 a month, you wouldn’t last a week!  This is someone who probably paid into Social Security $100K+ over her lifetime and now when its time to collect she’s getting $819 a month? Something isn’t adding up…

Start Early.

Everyone tells you this but OMG this is the best and greatest financial advice anyone can give you.  At 18, nobody’s really thinking about their retirement.  They’re thinking about the future, “what career path will I choose, what will I major in at school?” But even putting $100 a month towards your retirement is a HUGE jump start.

I played around with a retirement calculator and here’s what I found:

When I was 18, I was working a shit job selling pretzels at Auntie Annes, working minimum wage.  I was lucky if I earned as little as 600-700 a month in pocket money.  If I started putting $100 a month into an IRA or 401K from the age of 18- 67,  I would have roughly $500K saved by the time I’m ready to retire.  And that’s ASSUMING, I don’t increase my contributions as my earnings increase over the years.  Not enough to retire.  But not a bad figure to start with.

Now let’s consider someone a little older:

Life got me good and I had all these expenses, children, a mortgage, an expensive marriage, an even more expensive divorce.  I wasn’t able to get it together until I’m 40 to start saving for retirement.  I would have to contribute $500 a month at the age of 40-67 in order to have roughly $500K saved by the time I’m ready to retire.  But that’s still not enough to retire with and at 40, time is no longer on my side.  I’ll need to double down and make monthly payments of $1100.  That’s the only way I can save enough so I have at least 1M available when I want to retire at 67.  I still don’t think that’s enough to retire on but you can work with that.

Moral of the story: If you’re able to start young (most people can) and save a modicum amount, you are still in a much better position than someone who is older and needs to play catch up.  Compound interest is a bitch like that.

Get a Side Hustle:

Money doesn’t grow on trees.  If you don’t have the money now to set aside for retirement, when will you?

“If you always do what you did, you’ll always get what you got.”

In this type of scenario, somethings gotta give.  You’ll need an additional source of income.  A lot of people reading this now are going to start shaking their heads thinking, “I don’t have money and I don’t have time.”

Well, make time because old age don’t feel so good when you’re broke.  The time to make a move is when you’re young and capable.  It might be hard, it might be challenging but side money is the kind of money you can put ASIDE for retirement.

Here are some ideas on low cost ways to make money:

  • Uber- Drive and get paid.  You already have your own car so thats already taken care of.  Keep track to mileage, maintenance and gas costs.  Hustle for tips.
  • Work a 2nd job.  Any job.  Work at the McDonalds across the street.  Let your kids hang in the seating area quietly if there’s no one to watch them.  Don’t worry if you get fired, it’s only a side job, so speak up for what you need and hustle until it works  for you.
  • Blog and Youtube- this is actually a very long process to build income off of.  I would only recommend this if you have the time and the means to do this.

Mortgage vs Retirement vs Kids College

The truth that none of the other retirement gurus really are able to touch on is that  99% of us will only be able to makes so much money in our life time.  Most of us are on a fixed income of salary and paying off fixed expenses.

A lot of us are still paying off student loans, we have mortgages, car payments, insurance costs and the list goes on and on.  This is just a reality for most Americans.  There might be some left over to save, but is it enough?

Probably not.

In this case it’s important to prioritize the most important needs first.

Mortgage- when deciding to buy a house, there are so many factors to consider. I’m not going to go into buying vs renting, that’s for another post, but here are my top tips on how to make sure the mortgage burden does not overtake the other financial responsibilities.

  • Live in the cheapest, smallest apartment you can comfortably manage. Of course you wanted the nicer and bigger house in the better neighborhood but you need to really consider your reasons for wanting that home.  Is it ego?  Is it an expectation you had for yourself?  Is it maintaining the lifestyle you had as a child?  It’s time to reconsider and evaluate your expectations. Times have changed, money don’t flow like it used to.
  • Only consider a more expensive neighborhood if it means a better school district for your children.  And even then, consider a cheaper neighborhood with the option of a good private school.  Compare the costs.
  • Small is good.  You can dress up small.  Trust me, I’m a real estate agent in Manhattan.  There’s no such thing as too small.  I’ve actually seen some charming 400sqft studios!  But more importantly, small is cheap.  You don’t need the extra bathroom, it’s just more space to clean.

Retirement: As I discussed earlier in my post, retirement is the main priority.  Make it so. Focus on maintaining a retirement fund that will at least allow you to maintain the same quality of life you’re used to.

Kids College: As someone who had to spend 12+ years paying student loans, I don’t think I want my children burdened with that same issue.  At the same time, I don’t think it would be fair for me to burden my children with my living costs if I don’t have adequate retirement funds.  Paying for the kids colleges is the least important financial concern you should have. It’s nice if you can afford it but the kids can take out student loans or go to community colleges, there’s no loan for retirement.

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To cut to the chase retirement is something we need to think about NOW.  Pensions and social security are out the window. They can be considered supplements but not a fall back.  Make efforts to educate yourself on what you need to do to meet your financial goals.

Wishing you the best of luck!

Check out my other posts:

Flashpass to Retirement: FiRE and LeanFiRe Strategies

Why I Budget and How to Budget: Personal Finance In A Nutshell

Motivational Book Club: The Total Money Makeover by Dave Ramsey