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$1 Million: Does It Still Mean You're Rich?

by Douglas Rice

Becoming a millionaire used to mean you were on top of the world. Nowadays, it means you are climbing up the ladder. While a million dollars is completely out of reach for many people, it's just a step along the way for many others. Why? Because it doesn't go as far as it used to.

The term millionaire has been synonymous with being rich ever since we became a country. The person most often credited to be the first American millionaire, Elias Hasket Derby, made his fortune as a privateer during the American revolution. Back then a millionaire did really mean rich.

Also, we all love round numbers. We love to see 1999 become 2000, and our odometer roll over to 100,000 miles. So it's only natural we would fixate on $1,000,000. It's a milestone with a lot of zeros. It's even got an additional comma. Now that's rich -- having two commas in your net worth!  But what does that get you? Not as much as you would think.

Housing

Housing is where most people hold their largest chunk of wealth and with real estate falling considerably in many areas, some might think that the lifestyle a million dollars would provide would be luxurious. But that depends on where you live.

There are plenty of nice places to live that don't cost very much, but according to the California Association of Realtors, the median house price in Palo Alto, Los Altos, Manhattan Beach and Cupertino is over $1 million. The median price for the entire San Francisco Bay Area tops $500,000 and Orange County is right behind at just under that. And those are just averages, not even something special. While other areas of the country aren't nearly this expensive, being a millionaire in some areas just means you paid off the mortgage.

Retirement

Another aspect of becoming a millionaire is not working. If you had a $1 million right now, could you retire and would your money last? This is a simple calculation. If you want to try to live off the interest and you invest the money in tax exempt municipal bonds that pay 4 percent, then you would have $40,000 a year to live on.

But that doesn't account for inflation going forward. If $1 million today doesn't feel like much, imagine what it will feel like in 30 years. At 3 percent inflation compounding for the next 30 years, $1 million dollars will have the purchasing power of $412,000 today and your $40,000 income will feel like $16,500. So retiring when you have $1 million may sound nice, but it's likely that it won't be what many people have in mind when they think of retiring a millionaire.

Instead of living on the interest, you could tap into the principal as well. Those are slightly more difficult calculations. For example, if you were 50 years old right now and wanted to plan for your money to last until you were 95, then you need money for 45 years in retirement. If you stick with the 4 percent return, then you could withdraw about $48,000 a year. Again this doesn't account for inflation going forward. Each year if prices rise, your standard of living would fall. In this example, you have 45 years of prices going up at 3 percent. So that last year will feel like $12,600 does today.

Combining Retirement and Real Estate

If we factor in a house, this gets even worse. If we take the price for a house out of the $1 million, even in a reasonable area and not San Francisco, it's going to be a big piece of your net worth and cut into your funds for retirement. For example, if you bought a nice $250,000 home, you would only have $750,000 left to live on. At 4 percent that would be $30,000 a year or $2,500 a month. That's before inflation takes a bit every year.

These retirement calculations show that even if your house is paid off, that living off a million dollars isn't what it's cracked up to be. And if your house isn't paid off, it's probably not even close to what you want to do.

Bottom Line

So the bad news is that even if you fall into a million dollars, you probably aren't set for life, especially if you are young. But the good news is, you'll still be a millionaire, and that's better than the alternative.

Make $30 an Hour Without a Four-Year Degree

by Thea Nyberg, PayScale.com

For job seekers without a four-year degree, breaking the $25-an-hour barrier can be a challenge. But with more technical certification and associate's degree programs than ever, many well-paying career options are accessible in a broad range of industries.

The following is a list of lucrative careers for those without a four-year degree, presented with median annual salary data from PayScale.com. That figure is then broken down to an hourly rate by dividing by 2080, the typical number of working hours in a year, according to PayScale.

1. Sales director
"If you are interested in a career change, but do not want to commit to further education, consider a sales career," says Sharon Reed Abboud, the author of "All Moms Work, Short-Term Career Strategies for Long-Range Success." Sales directors oversee sales staff to help meet objectives, plan and implement sales programs, and work to maintain budgets, among many other duties. While formal training is not a requirement for this position, sales experience and an outgoing personality are vital, according to Abboud. "Successful sales persons can often have the opportunity to climb the career ladder to increasingly lucrative management positions," she explains.

Sales director: $91,900/ $44 per hour

2. Security administrators, computer network
"As technology increases its reach, cyber crime is becoming a major concern for companies," says Debra Yergen, author of the "Creating Job Security Resource Guide." Security administrators work to prevent, troubleshoot, and repair security breaches while educating network users on cyber safety. Certification or relevant experience is essential to entry to this field, especially in absence of a four-year degree.

Security administrators, computer network: $72,000/ $35 per hour

3. Elevator installer/repairer
Elevator assembly, installation and maintenance are the main responsibilities of this position. Participating in an apprenticeship program coupled with paid on-the-job training is the standard, and workers must pass a licensing exam. Union membership is typically required by employers, and unions can help to ensure "an excellent salary, benefits, and pension," says Marky Stein, author of "Get a Great Job When You Don't Have a Job."

Elevator installer/repairer: $67,100/ $32 per hour

4. Real estate broker
Usually commission-based, real estate brokers' salaries are sensitive to shifts in the economy. Despite the current real estate market, Yergen predicts "resurgence in salary in 2010 with the extension of the housing tax credit." Brokers are tasked with understanding real estate markets, performing transactions, and advising buyers on their financing options. Additionally, real estate brokers must pass a written exam and maintain a license.

Real estate broker: $65,400/ $31 per hour

5. Nuclear medicine technologist
"Nuclear medicine technologists administer a type of drug called radiopharmaceuticals to patients and create diagnostic images that ultimately determine the presence of a disease," explains Yergen. With an increasingly large middle-aged and elderly population and advances in technology, job growth for nuclear medicine technologists is likely to remain steady. A certificate or an associate's degree is needed, and a license is a requirement for many employers and states.

Nuclear medicine technologist: $64,100/ $31 per hour

6. Radiation therapist
Administering radiation treatment to cancer patients is the main role of a radiation therapist. "As radiation therapists continue to be a critical part of the medical radiation oncology team, it will translate into an uptick of jobs," predicts Yergen. There is also room for personal advancement in this field, with opportunities that include teaching and research. Training through an associate's degree or certification program is necessary, and a license is required in many states.

Radiation therapist: $63,500 / $31 per hour

7. Construction manager
Construction managers oversee the construction of structures, facilities, and systems, and are often on call around the clock. On-the-job construction experience and/or completing a construction management certification program provide entry to this position.

Construction manager: $63,400/ $30 per hour

8. Air traffic controller
"As an air traffic controller, your job will be dedicated to keeping the skies safe. It is a very demanding and rewarding occupation." says Abboud. Providing an essential role in aviation, air traffic controllers ensure that planes maintain a safe distance between each other and help to coordinate efficient scheduling.

With most positions employed by the Federal Aviation Administration (FAA), air traffic controllers must complete a FAA-approved education program and pass a pre-employment test.

Air traffic controller: $63,000/ $30 per hour

9. Video game designer
Video game designers create the storyline and structure of a video game and determine the rules of play. They typically need to possess an understanding of software design and computer programming, and a degree or certification from a technical school can provide an advantage. Although currently at a point of high popularity, video games tend to go through phases of increased and decreased popularity, cautions Yergen.

Video game designer: $62,300/ $30 per hour

10. MRI technologist
MRI technologists train in programs available through hospitals, colleges and universities to earn a certificate or associate's degree. With more doctors' offices and clinics providing diagnostic services, demand is higher than ever, says Yergen. According to the Bureau of Labor Statistics (BLS), "Health care will generate 3 million new wage and salary jobs between 2006 and 2016, more than any other industry."

MRI technologist: $61,000/ $29 per hour

10 Job-Search Rules to Break This Minute

by: Liz Ryan

Old-school job-search advice is the worst. We read and hear it everywhere, yet no one can trace its source. Who made up the rule that we can't use "I" in a resume, for instance? What's worse is that most traditional job-seeking advice doesn't work.

Here are my top 10 most useless job-search rules to break as soon as you get a chance:

1. Never use "I" in your resume.

We've been taught to write a resume like a stiff government document. No one wants to read something like that. "I" is a perfectly wonderful word to use when you're talking about yourself. An HR person who writes in his resume summary, "I'm passionate about helping employees succeed on the job" is stepping out of the formal protocol to tell an employer, "Here's what kind of HR person I am." That's a big plus, not a minus.

2. Never make it obvious (on LinkedIn, for instance) that you're job-seeking.

Poppycock! If you don't include something in your LinkedIn "headline" (the line just under your name) to tell employers and others that you're looking, they'll assume you're employed and they won't reach out to you. A headline like "Start-up Marketing Manager Seeking Next Challenge" gives people a reason to contact you if they've got a job opening. That's free marketing for you. Grab it!

3. Your cover letter should be conversational, while your resume should be formal.

Who says it has to be this way? Lots of hiring managers skip the cover letter entirely. Your resume has to make it clear what you're about, so it has to brim with as much of the brand You as it possibly can. Ditch the "results-oriented professional" for weightier bullets like, "I got our X-25 product out the door six months early to add $10M in quarterly sales." Write a conversational resume summary statement that's free of boring boilerplate like "strong work ethic."

If you're not stuffy yourself, why portray yourself that way in your resume?

4. If you can reach an HR person inside the company, you're ahead of the game.

I wish this were true, but as a 20-year HR leader I must tell you that most HR people are not focused on screening people in -- their role is to screen job-seekers out. You're better off forgetting about HR and finding the hiring manager in the company, either through your network, your LinkedIn connections, or by researching this person and contacting him or her directly.

5. When you're asked for salary requirements, quote the lowest number you can.

Here is more horrible advice that will get you a low-ball job offer, if you get one at all. When you're asked for a salary requirement, give a realistic figure that takes into account what other companies are paying people (right now, not three years ago) with your skills. If you don't have that information, use Payscale.com and Glassdoor.com to get a bead on it.

6. In a job interview, talk as much of the time as you can.

Here's why you don't want to do this. When you're talking, you're not learning. Your goal on a job interview is to learn as much as possible about the business pain behind the job ad. The more you learn, the smarter and more targeted your interview responses can be. When you have a chance to ask the interviewer a question, take it!

7. On a job interview, make sure the interviewer knows you're perfect for the job.

You won't know what "perfect for the job" means to a job interviewer unless you ask thoughtful questions and get the interviewer talking. Saying "I'm perfect for the job" is pointless until you understand what problem this new hire is intended to solve. Save the self-praise ("I'm smart and strategic") and use your interview airtime minutes sharing concrete, relevant stories about your accomplishments instead.

8. Ask the interviewer, "Can I have the job?"

This is an old-school sales closing technique that typically doesn't work, but does annoy and even repel job interviewers who have heard this pitch a few million times before. If you're going after a sales job, this approach might work, but the rest of you want to leave with a smile and the confidence that you put your best foot forward. If you're really perfect for the job, then you'll hear from them. Groveling is beneath you.

9. Wait until the job offer is extended before discussing salary.

Don't do this. If you wait this long, you're likely to get a lowball offer that will be difficult to change, and you'll have only yourself to blame. Broach the salary topic at the second interview or in the phone call or email that invites you for a second interview. Make sure you and the employer are in the same ballpark before people start getting the idea that you'd work for peanuts.

10. Only go after jobs that look perfect for you, on paper.

It is nearly impossible to put down everything important about a job in a job requisition. You can't get a job unless you go after it. If you have the background to do a job, apply for it.

A job search is a volume affair. The more interviewing experience you have, the more confident you'll be and the more contacts you'll accumulate. Now get out there!

What's Eating Away Your Money?

by Katie Adams; Friday, December 18, 2009

Recessionary times create cautious consumers. According to the credit reporting agency TransUnion, more of us are doing a better job at managing our credit these days, but how are you doing at counting pennies - not just paying off your credit cards? These money-eaters may be slowly picking away at your bank accounts without you even noticing.

Investment Service Fees
Do you know how much money it costs you to invest your money each year? While investing in the markets is a critical step toward building a more secure financial future, it's also important to be aware of — and try to lower - all those fees associated with your accounts. Take a look at your most recent bank account and investment account statements to see what you're paying in account maintenance fees, investment advisory fees, sales charges, in-service transfer fees, performance fees, 12b-1 fees (with mutual funds), withdrawal/surrender fees (with a variable annuity) etc. Talk with your investment adviser or broker about lowering those fees, and reinvest the money you're wasting instead.

Automatic Renewal Fees
In our digital age, signing contracts has never been easier. Unfortunately it's also become much easier to forget the terms of those contracts. You may not realize that the default setting for that movie home delivery service or online greeting card site automatically renews at the end of each year. If you're not checking your credit card statements closely, you could easily continue paying for services of which you never take advantage.

Credit Card Fees
With Congress clamping down on credit card issuers, the industry is getting creative when it comes to finding new ways to generate revenue. Even if you already have a card, check the terms and conditions, because an increasing number of companies are charging existing cardholders new fees, including annual fees, account inactivity fees (if you fail to regularly use the card) and heftier late payment fees. If you're paying an annual fee, consider switching to a card that doesn't charge you for the privilege of charging or, if you have a long history with the card company, ask for the fee to be reduced or waived.

Cancellation Fees
Many companies and services offer incredible signing bonuses - like "free" movie channels offered with a cable company or "free" services added on when installing a new phone line - for a limited time. But even if you discontinue those perks before the promotional period is up, cancellation may come at a cost. Check the terms of every promotional offer as carefully as you would if you were signing up for a paid service - or you will end up paying for it in the end.

Checking Accounts
Who pays for checking anymore? If you are, your bank should send you a thank you for the free money you're simply giving them. Banks and credit unions nationwide are offering just about everything free to checking account customers, including free access to ATMs or debit cards, free online banking services, free direct deposit transactions and unlimited check writing. If you're paying for checking account privileges either ask your bank to switch you to a free service or take your business elsewhere.

Packaged Snacks
When the mid-afternoon munchies hit, you're more focused on crunchy chips than crunching numbers. But if you were to add up the money you spend on prepackaged snacks (candy bars, protein bars, ice cream novelties etc.) you'd realize you could easily spend $25-$50 or more a month. Buy larger sizes and create smaller packages to bring to school or work, and pocket the difference.

Paying for the Name
For many purchases, generic or store brand items provide the same quality at a much lower price. For example, generic drugs, which have the same active ingredients as their brand-name counterparts, regularly cost two-thirds less. In fact, store brands tied or beat out brand names 23 out of 29 times in a Consumer Reports test. Consider what you're really getting compared to the price for that big brand name, opt for generic and keep those dollars in your own pocket instead.

Digital Diddies
You think, "well it's just $2.95 for that iPhone app, only $2 to download a song to your iPod and throw in a few ringtones for $5." None of it sounds like a lot, but it adds up quickly. Make a budget for your digital shopping before you start wildly downloading.

It all Adds Up
Become a more discerning shopper, demand more for your business and read those statements carefully. As Benjamin Franklin said "watch the pennies and the dollars take care of themselves."