When thinking about retirement, should I be selfish with my money?

If you are saving monthly, have cash in the bank, no or minimal debt, and plan accordingly for your retirement, then this article may not interest you.

But, if you spend money freely, have high credit balances, and never place much thought on your future. It may be time to change your behavior, learning that it is okay to say “no” to spending money and placing your interests first.

According to a November 2023 survey by Bankrate, 49 percent of credit card holders carried debt from month to month, and in 2022, 23 percent of Americans had no emergency savings.

Unfortunately, we live in a world of consumerism. If you do not live in a lovely home, drive a nice car, or dine at first class restaurants, you may feel like a failure. But often, there is not a direct correlation between wealth and the image we present to our friends and family. Just because someone is perceived as successful, it does not mean they have acquired wealth or are prepared for retirement.

Are you:

—Always stressed about money

—Struggling to pay your bills

—Relying on credit to carry you through the month

—Wondering why you do not have any money

—Giving money away to adult children, family members, or friends

—Shopping in secret and hiding your purchases

—Dining at expensive restaurants that you cannot afford

If you do not understand how and where you are spending your money, it may be time for you to evaluate your finances and begin to plan for your future.

Are you saving for your retirement?

People can live 10, 20, or even 30 years in retirement. If you have a pension, it may not be much of a concern because you will have an income stream. But most people do not have a pension and need to rely on their savings and social security benefits for income.

Understand how much you will need to save before you retire so you can transition into retirement without reducing your standard of living. If you do not know where to start, a Certified Financial Plannercan help you by running projections to estimate how much you will need to have saved prior to retirement to align with your current living standards.

Conventional wisdom dictates that you should plan to withdraw 4% (adjusted annually for inflation) for about 30 years from a portfolio that is invested 60% in stocks and 40 percent in fixed income. This is a basic rule, and the distribution amount is often much lower than people anticipate.

For an individual who has $1,000,000 saved, under this rule, $40,000 year one is a safe withdrawal rate. The amount you should withdraw will depend on many factors, such as age, net worth, portfolio allocation, and the current economic circumstances. Depending on your situation, the annual withdrawal rate could be lower than 4 percent.

Are you budgeting?

A budget is a personal plan to manage your money. It provides the opportunity to identify and monitor your spending. Simple as it may be, it is the foundation for sound money management.

Budgeting begins with monitoring a specific period, such as a month. It requires that your income and all of your spending is tracked during this period. It records fixed expenses, as well as the simple purchases we often forget, such as a quick bite to eat.

At the end of a period, your budget provides a transparent snapshot of your income and where you spend your money.

The key to budgeting is to understand if you have a monthly shortfall or surplus to determine what changes you can make to improve your financial outlook now that will positively impact your retirement.

Do you have credit card debt?

If you are using credit because you are living beyond your means, this is a red flag with the potential of having a detrimental outcome in your future. Evaluate what you can do now to make paying off your debt a priority. Find a payment strategy that works for you, such as the snowball or avalanche method.

This also means that you will need to change your behavior and spending habits. Find areas in your lifestyle where you can easily eliminate the expense by changing your actions, such as eating out less, not shopping online when you are bored, or finding inexpensive activities to engage in when spending time with family and friends.

Review your credit statements monthly to know what the interest rate and balance is on the outstanding debt. And if you do not think you will have the willpower to stop using your credit cards, take them out of your wallet and place them in a safe place. Then delete the credit cards from on-line sources you may be tempted to use. So, in a weak moment, they are not readily available.

When you apply for a credit card, a loan, or insurance, a file is created on you. This file is managed by credit reporting companies, and the information is called your credit report.

Your payment history and the amount of credit that you have are tracked over your lifetime. Credit history is important; without a credit score above 720, it is difficult to finance the purchase of a home. Credit card reporting agencies know that when a consumer carries high credit card balances, their default risk increases, and the agency will penalize the consumer by lowering their credit score.

What are you short and long-term goals?

Identifying your short-, mid-, and long-term goals and objectives, as well as the impact obtaining them will have on your finances is key to a successful future, and eventually retirement.

Short-term goals could include budgeting, reducing debt, and establishing an emergency fund.

Mid-term goals may be to buy a new car or save for a down payment for a new home, while long-term may be planning for your retirement. When you do not plan for your goals, you may find yourself in a financial position that is not ideal.

Planning prepares you for the future and eliminates the stress and additional expense from poor impulsive financial decisions.

If you are not currently preparing for your retirement, then it may be time to learn to say “no” to yourself, children, family, and friends when it comes to spending money that is not in your best interest. You do not need to elaborate as to why and can easily defer to your budget. The simple answer could be, “It is not in my budget this month.”  Then take a deep breath and exhale because you have taken the first step to financial freedom.

Teri Parker CFP® is a vice president for the Riverside office of CAPTRUST Financial Advisors and has practiced in the field of financial planning and investment management since 2000. Contact her at Teri.parker@captrust.com.

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Fix your fixer-upper pre-sale, this company says, and quit leaving money on the table

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Fixed-up homes tend to sell faster and for more money than fixer-uppers.

But some owners would rather sell their home as-is than face the hassle of getting it into turnkey condition.

“People don’t do it, mostly because they’ve had bad experiences with renovations. There’s lots of anxiety,” said Michael Alladawi, chief executive and founder of Revive Real Estate, an Irvine company that helps homeowners refurbish their properties. “It’s not uncommon to hear horror stories, or to hear (it took) double the time and double the cost.”

But those sellers, Alladawi said, “are leaving money on the table.”

Revive, founded four years ago, claims its business takes the hassle out “presale renovations.”

Revive helps homeowners evaluate the cost and potential value of revamping kitchens and bathrooms and renovating floors. If refurbishing boosts the home’s value enough to make it worthwhile, Revive hooks clients up with contractors and oversees the construction. They even pay for the work, getting reimbursed from sale proceeds.

If the homeowner needs cash fast, Revive will buy the home at 80% of its value, using the remaining equity to cover renovation costs. After the home sells, Revive gives the owner a second check, handing over all the profits minus renovation costs, closing costs and a 6% fee.

Since its founding in 2020, Revive has expanded to Texas, Florida, Washington and Tennessee. It has renovated about 2,000 homes, most of them in the Bay Area and Southern California.

We sat down with Alladawi recently to learn more about his company and the benefits of giving homes a facelift. The interview was edited for space.

Q: What inspired you to create this company?

A: The mission is to automate home flipping for the consumer. And by flipping, I mean strategically update your home to bring it to market in a way that maximizes its sales value.

Consumers usually leave about 15-20% of the money on the table by not maximizing the value of their homes when they sell them.

And in California, that’s a lot of money. If we’re talking about a million-dollar, entry-level home, that’s $200,000. Or for a $2 million home, that’s $400,000 that people are leaving on the table, simply because we have an aging inventory.

Everything is built in the ‘70s, ‘80s or the ‘90s. Even the 2000s is dated.

They have homes that are dated that would greatly benefit from some strategic upgrades.

Q: Why don’t more sellers renovate their homes?

A: The renovation space has had literally no innovation ever. The contractors still put contracts together on a paper napkin. Their wives are coordinating material procurement.

The types of contractors that people hire, they’re good guys, but they need support. And they don’t have it.

Essentially, we can be the consumer-facing entity that takes care of all the front- and back-office tasks of a contractor, letting the contractor focus on one thing, which is man-powering that job.

Q: How exactly does your service work?

A: (We help with) the evaluating, planning and execution.

First of all, (we assess) what the after-renovated value of a home could be and what the as-is value of the home is today.

Is there a delta between after-renovation value and as-is value?

Sometimes there isn’t. Maybe you already have a really nice house. And sometimes that delta is very big.

The second step is planning. Once you understand there is an opportunity to increase the value, you have to decide what is your scope and what is your budget.

Are you going to paint the kitchen or replace the kitchen? Are you going to remodel all the bathrooms or one bathroom? Are you going to refurbish the floors or change the floors?

And then the third part of the equation is the execution.

Revive helps homeowners figure out those things out, and then Revive matches you with a contractor that is supported, that can execute predictably on your project. And Revive pays that contractor upfront, so you don’t have to until your home sells.

Q: How do you make money?

A: We’re doing (support) work for the contractor, and for that we charge the contractor a fee. And Revive purchases that contract. For giving them money up front, they give us a discount of 3-5%.

And Revive only takes on projects in a market where homes move in 60-90 days or less, and we only take on renovations that can be completed in a maximum of 60-90 days.

We keep it simple. Cosmetic renovations (where permitting) can be done over the counter (at city hall). And these are the biggest value-add items. Kitchens. Bathrooms.

Q: Does Revive build ADUs (accessory dwelling units)?

A: Not today because we haven’t figured out how to do it in 90 days or less.

Q: What does a typical job cost?

A: Our average budget for renovation is $80,000 to $160,000. And the average scope is a new kitchen, a couple bathrooms, floors, baseboards and paint.

Q: How much can remodeling add to the sale price of a home?

A: Typically, 15 to 20%. Of the homes we’ve remodeled, that’s how much value we’re adding.

And a good rule of thumb for consumers is if you can put $1 in and get $2 out, it’s a good deal.

Q: What are the most common pitfalls when remodeling your home?

A: Finding and vetting a contractor is a very difficult thing for the general consumer.

They all use different contracts. They all write their bids differently. Sometimes it’s really hard to understand what you’re getting when you’re looking at a bid. What’s included, what’s not included.

Sometimes what looks to be the lowest bidder ends up costing the most because it excludes so many things that you may not even know are necessary.

The only guy that gets hired is the cheapest guy. So, contractors have figured out how to manipulate their bids to appear cheaper by excluding things that they know will need to be added in later.

That’s why it’s common to hear people say their budget doubled. Well, yeah, because they went with the cheapest bidder that excluded things that they knew needed to be included.

Michael Alladawi Profile

Job Title: CEO and founder

Organization: Revive Real Estate

City of Residence: Irvine

Education: Bachelor’s degree in biology

Previous jobs: Manager for One Legacy, president of Umbrella Capital Group, broker at The Plaza Group Realty.

By Gregory Korte, Hadriana Lowenkron and Jennifer Jacobs, Bloomberg News

WASHINGTON — No Labels, the centrist political group that sought to shake up the 2024 presidential campaign with a third-party candidate to rival Joe Biden and Donald Trump, said Thursday it wouldn’t field a candidate after all.

“Americans remain more open to an independent presidential run and hungrier for unifying national leadership than ever before,” No Labels founder Nancy Jacobson said in a statement. “But No Labels has always said we would only offer our ballot line to a ticket if we could identify candidates with a credible path to winning the White House. No such candidates emerged, so the responsible course of action is for us to stand down.”

The decision not to field a presidential ticket is a boon for Democrats who had complained that a centrist candidate would play spoiler to Biden’s chances of winning.

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The abandoned presidential bid comes after weeks of speculation over who would be on the ticket, including former New Jersey Gov. Chris Christie, former U.N. Ambassador Nikki Haley and former Maryland Gov. Larry Hogan, who stepped down from the No Labels board and has since launched a U.S. Senate candidacy.

It also follows the death of the organization’s co-founder, former Sen. Joe Lieberman, last week.

No Labels had seriously considered a handful of candidates in recent weeks, including billionaire Bill Haslam, the former Tennessee governor, and Geoff Duncan, the former lieutenant governor of Georgia, said one person familiar with the conversations.

The group, which was largely focused on fostering bipartisan policy in Congress during its 14-year history, had spent months laying the groundwork for a third-party presidential bid. No Labels called its plan an “insurance policy” in case of a Biden-Trump rematch that would pit two historically unpopular candidates against each other.

Voters could still have other third-party alternatives to choose from, including Robert F. Kennedy Jr., Jill Stein and Cornel West. But a No Labels-backed candidate would have inherited advantages that most such efforts lack — including access to the ballot in 19 states.

A political action committee called New Leaders ’24 launched in the hopes of raising $300 million to support a candidate backed by No Labels, while another super PAC allied with the group, No Labels 2024, was raising money to fund a potential nominating convention. Federal Election Commission filings show No Labels 2024 had $1.9 million cash on hand at the end of 2023.

A Bloomberg News/Morning Consult poll released late last year found that appeal for an independent candidate in seven swing states was strongest among key Democratic constituencies such as young people and urban residents, demographics that are critical to Biden reassembling his electoral coalition.

Sixteen percent of Biden’s 2020 voters say they are drawn to third-party alternatives, compared to 11% of Trump’s supporters, according to the poll.

©2024 Bloomberg L.P. Visit bloomberg.com. Distributed by Tribune Content Agency, LLC.