A senior financial advisor at Ameriprise says you should fund retirement accounts first
By Emily Brandon
Posted May 18, 2009

Choosing how much of your savings to spend on a child's education while also planning your own financial future is a challenge every parent faces. Evelyn Dinkins, a senior financial advisor for Ameriprise Financial, has a daughter in college, but is also saving for her own retirement. Dinkins recently spoke with U.S. News about why you should fund retirement accounts before paying the bursar. Excerpts:

How should you prioritize saving for your children's college education and funding your own retirement?
The prioritization is a very personal thing. Typically retirement comes first and education is a close second. There is only one way to save for retirement and that's for you to do it. There aren't many pensions left out there. Never leave 401(k) matching money on the table. That's free money. Fully save for retirement and if there is money left over, then save for education. There are a lot of ways to pay for education. There are loans. There are scholarships. There are grants. There are also so many ways students can keep costs down. Students can go in state and live at home. Too often we see people who haven't saved for education and use their retirement accounts. If you do that you may end up having to delay your retirement.

Are many parents able to completely fund their children's education while still keeping retirement plans on track?
A lot of times they can't fund the whole college experience and pay for retirement. They can only fund some amount of the college education. A lot of times their own experience has helped them decide how much college they want to fund. Sometimes parents come in with a very definite idea like, "I had to pay for college or my parents paid for me." We always start planning with the end in mind. Tell me what retirement is going to look like. Tell me what you want your child's college experience to be like.

Should you level with your child about the family's finances?
Have a discussion with the student when they are about 16 or 17. They should start looking at various schools and get a feel for all these costs. You don't want the student to have unrealistic expectations. At the age of 16 or 17 they are capable of understanding what it's going to cost and where it's going to come from and what the family's finances are. Even if you could afford to pay for everything, it's important for the student to understand how much college costs. My daughter looked at one particular school and I just had to say that can't be on your list unless you want to come out with a massive student loan. Unless the kid can get a scholarship, they often don't go to the expensive schools. Expensive schools do have large endowments and the average student doesn't even pay the full amount because they have so much money to give. You need to check with the school. Typically you can find out on their website what the average student is actually paying.

How does saving for college and retirement affect how much financial aid a student is eligible for?
Money that is set aside in retirement accounts is not considered money that is even available to go to a college education. 100 percent of that money is going towards your retirement. Don't put all of your savings into a 529 plan. The 529 plan is all for college and it can skew your financial aid. If you're counting on financial aid it may not be the best route.

How much do you need to save to finance four years of college and retirement?
You need to be saving probably 20 percent of your income for retirement if you are going to be saving well for retirement. Most people are saving 5 or 6 percent for retirement. College always costs more than you think it's going to cost. If it says the university costs $10,000 a year, assume it costs more than that because you are going to be spending more money. You're going to need to have auto insurance, additional food, and what if they don't want to live in the dorm? It's going to end up costing more. You can find out what it costs and then I think you should add another 10 to 20 percent over what you think it is going to cost.

source: US News

Karen Burns

You can’t pick up a paper, thumb through a magazine, listen to the radio, watch TV, or log on these days without being pummeled by the relentless news: Unemployment is up. The economy is down. The sky is falling and it's aimed right for your head.

As if looking for a job wasn’t hard enough.

You’re tempted to just stop consuming news. You’re tempted to just give up the job hunt. But you need to keep up with the world, and you need to find a job.

What to do? Consider these words of wisdom from Dr. Cox on ABC's Scrubs: “Statistics mean nothing to the individual.” Cox was talking about appendicitis (in an episode called “My Hard Labor” ) but he could just as easily have been talking about joblessness and the current economy.

Dr. Cox knows, and you should know, that statistics are useful when describing large populations. But you are only one person. You need only one job. Using statistics as an indicator of your individual chance of success is not only discouraging, it’s downright unrealistic.

Here’s an idea: Get used to thinking of yourself as an exception. And then position yourself, in the eyes of potential employers, as an exception. (You do this by clearly describing yourself and what you do in terms of profit generation. That’s what employers care about—the old bottom line!)

Yes, 13 million of people are out of work. But that’s them. You’re you. Show yourself as capable, independent, motivated, and knowledgeable—the exception—and you have just greatly increased the odds of landing the job you need.

source: US News

It isn't easy to face down a job interview, particularly in this environment. Prepare for it
By Liz Wolgemuth
Posted May 8, 2009

At an interview last month for an associate position at a major consulting firm, one candidate reports whipping through a marathon afternoon session and being asked about a business case with "very little time to organize a response." A different candidate reports having interviewed in January for an associate position at the same consulting firm and being questioned largely on experience. Both candidates said they got, and accepted, offers from the company—and the latter offered a bit of advice to others interviewing for the position: "If you are friendly, warm, and knowledgeable, then things ought to go well."

These firsthand accounts of interviewing experiences from Glassdoor.com may offer job seekers some of the more useful insights into the abyss of the interview process. The website launched last year with give-and-get salary info and employer reviews (offer up your own salary or your review and you'll get entry to the others), but these days job seekers are hunting for work in a much more competitive environment and may be less interested in the insider details that would help them negotiate a higher bonus than in the kind of details that will help them get an offer. The appeal of Glassdoor's interviewing offerings has much to do with the seeming total opacity of the process. In this economy, nerves are running particularly high. That's why preparation is key.

Here are key steps to preparing for a job interview:

Know the company: Ferreting out basic details on the company you're applying to seems like one of the most obvious efforts candidates would undertake, but it's not a given that they will. Ellen Gordon Reeves, author of the recently released Can I Wear My Nose Ring to the Interview?, recalls working at a book publishing company and interviewing candidates who thought they were there for a magazine job. It's not just young people who underprepare, Reeves says. Job seekers should be doing rather ambitious research—reading annual reports, learning company business plans, and setting up Google Alerts so they're up to date on company news. Some career coaches teach job candidates to learn the issues or problems a company is facing and to prepare some thoughts on tackling those issues.

Research the people: It's important to know what the company does, but it may be even more important to know who you'll be talking to once you get there. Reeves suggests asking who you'll be interviewing with—name and title. Then get familiar with his or her staff biography and LinkedIn profile. "You need to know as much as possible about the people you're interviewing with," Reeves says. It's not a fail-safe, however. Company plans could change, and you might end up interviewing with someone entirely different.

Find an insider: Find someone who knows this company and can provide valuable insights into the work you'll be doing, Reeves suggests. He may be able to provide some details on the people you'll be interviewing with and their style. He may also be able to tell you about the person who's leaving the job you're interviewing for and about his or her skills and the issues he or she dealt with.

Know what's coming: Check out the Glassdoor data, even if your company isn't among those listed. If you're lucky enough to be applying for a software engineering job at Microsoft, you'll have four interview reviews to check out. But if you're applying for a software engineering job at a small company in Indiana, just reading through the 215 sample software engineer interview questions can still be useful preparation. Job seekers tend to fear the interview experience because it's filled with unknowns. "The only thing that can ease the anxiety is information," says Robert Hohman, founder and chief executive of Glassdoor. Arming yourself with potential questions and reading what others suggest as good answers can prepare you for the often hypothetical level of conversation in job interviews. It's easy to get stymied and stunned by a seemingly impossible question—i.e., How many blades of grass are there in Michigan?—but the interviewer is generally looking to see how a candidate thinks and processes, not to test her level of knowledge on Midwest horticulture.

Study your résumé: Your résumé should be well tailored to the job that you're applying to, so much that it should serve as a kind of outline and study manual for your interview preparation, Reeves says. Use the requirements for the job as spelled out in the job posting to tailor your résumé. Then, you'll be automatically speaking to your relevant work experience and qualifications. In preparing for the interview, you should recruit friends and family to "test you on your résumé the way you'd test yourself before an exam," Reeves says.

source: US News