Life & Love

Money Management in 20s and 30s


Dear E. Jean: I spend my days managing other people’s careers in the fashion industry. I look after their money and oversee enormous project budgets, but I’m 29 and spend zero time on my own finances.

Beyond contributing to the 401(k) provided by my employer, I’m clueless about managing my own portfolio intelligently and fear I’ll have no money when I’m old. I try to save a little each month for emergencies. But after SoHo rent, dinners out, doggy day care, a quick trip with girlfriends to Reykjavík, clothes, shoes, bachelorette parties, hopping over to Prague with my boyfriend for a long weekend, etc., I’m lucky to have anything left to give to charity, let alone a few bucks for emergencies.

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I earn a decent salary. But do I earn enough to warrant a financial adviser? (And where do I find a reputable one?) Is advice from my friend’s investment-banker boyfriend enough? —Bag Lady of 2052

Bags, Old Girl: Ahhh, you and I have more in common than you know. I don’t suppose there’s a woman alive more equipped to advise you—I’m a specialist in not saving money. But first let me tell you a little story about my friend.

People send me many questions about cads. I also answer queries about chumps, heels, half-wits (see the first question), scoundrels, jerks, degenerates, dingbats, creeps with 19 guns in their basements, and so on. But in the whole quarter century I’ve been romping along at the Ask E. Jean desk, one of the lowest chaps I ever ran across was Mr. Bunco.

Mr. Bunco is my friend’s own personal cad and financial adviser.

She says I may go public with their affair because although I’ve warned people against twits, pimps, lechers, and fiends, I haven’t warned them nearly enough against pinstriped polecats like Mr. Bunco.

So listen, Bags: My friend broke up with Bunco because he lied and cheated and boy, did Mr. Bunco neglect her! While the man was peppering her inbox with newsletters about “14-year highs,” her retirement account (IRA)—which Mr. Bunco promised on his website to “tailor to her individual financial objectives,” and which was supposed to be increasing, so my friend could retire one day and embark on a glamorous spree—was leaking (believe me, leaking!) money.

Indeed, after 22 years, her IRA had less money in it than at its inception. Had she e-mailed her Social Security and bank routing numbers to the Nigerian prince whose brother, the astronaut, is stranded in space, she’d be sitting prettier.

Oh, I know what you’re thinking, Miss Bags: E. Jean, come on! Your friend should never have given her hard-earned money to a sweet-talking con man who preys on pitiful ignoramuses like her.

But noooo. Mr. Bunco is worshiped with unceasing delight in the financial press. He occupies the 41st floor of a Wall Street tower with marble floors so expensively shiny that when my friend stepped off the elevator to meet him, she could look up her own skirt.

My friend: I’m unhappy.

Mr. Bunco: I’m sorry you’re unhappy.

My friend: The market has tripled since 2009. How can I have less money in my IRA than I started with 22 years ago?

Mr. Bunco: Let me explain….

They were in his conference room, which looked like one of the larger bathrooms in Hearst Castle, and my friend said it took Mr. Bunco 41 minutes to tell her why her having less money in her IRA than she started with 22 years ago was all her fault. She thought about giving him a running kick out his 41st-floor plate-glass window, but instead she took the elevator to the lobby, called me, and confessed the whole story, including how much she had remaining in her IRA.

And what was that amount? Twice the money I had in my IRA! It turns out I’m a bigger idiot than she is. So I will now endeavor to pound three pieces of advice into your head, Miss Bags:

1. Contribute the full amount your company matches to your 401(k). This is the most painless way to put away money for when you are, as you so poetically put it, “old.” And then watch your portfolio like a hawk! (The defects of my character are endless, but this defect is the most asinine: I never even opened my monthly statements.)

2. Ask the richest women you know who their financial advisers are. Pick the one who’ll help you set smart, doable financial goals and oblige you to stick to them. I recommend Ellevest (no relation to ELLE magazine), a brilliant, low-fee, easy-to-grok investment platform for women. Using the Ellevest projections, I saw that a 29-year-old who earns $50,000 a year and invests 20 percent of her income will have $1,040,230 or more according to the majority of market scenarios at age 66. More than a million! So, yes. Whatever your salary, you do need a financial adviser or a service like Ellevest. And I suppose at this point I should tell you to check if the adviser is a fiduciary, but, frankly, it means diddly-squat. Mr. Bunco was a fiduciary. If you don’t keep your eye on him or her, a fiduciary (a person who supposedly puts your financial interests ahead of his or her own) can lose your money as fast as a nonfiduciary.

3. Don’t shun your fund. I’m pretty good at making money, but terrible at saving it. Check yourself out: has a calculator for figuring how much you should be putting up for a rainy day. Warning: The numbers will shock you so badly that you’ll exchange Prague for a ride around Coney Island on roller skates. Which actually sounds quite fun.

As for me? I’ve transferred my “wealth” to Betterment, an automated investing service, and now robots are working for me.

Who needs a pricey financial consultant when the Betterment algorithms are eliminating human judgment, following the market as a whole, rebalancing my portfolio of index funds and ETFs, harvesting my tax losses (a tax-saving investment strategy), and machine learning and improving as they trade. As the Betterment robots get smarter, I get richer. How rich, Miss Bags? I made more money in one month with Betterment than my friend made in a decade with that chump Bunco.


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