The AICPA and its members continue to be at the forefront of the financial literacy movement with free programs, resources and thousands of CPAs across all 50 states volunteering to help Americans with their financial understanding.
Last month marked my fourth Financial Literacy Month at the AICPA. It’s amazing how much the landscape and messaging has changed in just a few years. While our outreach and exposure for the program has grown, our actual messages to individuals have become shorter. We have moved from lengthy articles on our websites, to a few sentences on Facebook and now to singular images on Tumblr. In a world where younger audiences are looking increasingly to online sources for financial advice, how do we accurately communicate financial literacy lessons with just one animated photo and a few words?
CPAs serve as trusted advisers and provide their clients with expert guidance on a variety of topics. It’s no surprise that they are frequently cited by the media for their expertise in areas such as tax, financial planning and even cyber security best practices. I’ve summarized a few recent examples of CPAs helping people make informed decisions about their financial lives.
As Financial Literacy Month draws to a close, it’s important to reflect on the essential role CPAs play in helping improve the financial knowledge of Americans. Educating consumers about their finances is the volunteer cause of the CPA profession. Through the AICPA’s 360 Degrees of Financial Literacy program (360), thousands of CPAs from all over the country volunteer their time to speak with consumers of all ages about their finances. Increasing our citizens’ financial education is critical to our country’s financial success, and the AICPA is leading the way for the CPA profession.
During my tenure as chair of the National CPA Financial Literacy Commission, CPAs across the country achieved much and celebrated many milestones in financial literacy. I have been involved with developing and releasing several rounds of creative from Feed the Pig, the AICPA’s PSA campaign with the Ad Council, and, along with the rest of the Commission, participated in releasing the AICPA’s first consumer publication, Save Wisely, Spend Happily, authored by Commission member Sharon Lechter, CPA. Commission members promote 360 and its related programs, and represent 360 before the media and national organizations. Our members are essential in promoting 360 with AICPA leadership, committees, state society leadership and key accounting organizations. I am proud of the work Commission members do and the leadership they provide.
CPAs in public service have also played an important role in the profession’s financial literacy efforts. On April 22, U.S. Representative and Congressional Caucus on CPAs and Accountants member Michael Conaway, CPA (TX-11) gave a speech on the House floor highlighting April as Financial Literacy Month. Representative Conaway noted the important role that CPAs across the country play in improving the financial literacy of Americans, and how, for over 10 years, the AICPA, members and state CPA societies have worked together through 360.
In a few short months, millions of new college graduates will enter the job market with an average of $30,000 in student loans. Student loan default rates are rising as recent graduates struggle to pay down their debt. The reason? New graduates will have degrees that have prepared them for careers or graduate school, but most will not have the knowledge to make sound financial decisions. That is why financial literacy is so important.
April is Financial Literacy Month and this year the AICPA marks the occasion with a renewed sense of purpose. With CPAs as our champions, the AICPA has advanced the financial literacy cause for over a decade, and we will continue to provide leadership in improving the financial understanding of future generations. It is critical not only for their individual success, but for the financial success of our country. For more than 10 years, the AICPA, its members and state CPA societies have been leaders in financial literacy by providing free programs, tools and resources for consumers, educators and more. The AICPA’s flagship 360 Degrees of Financial Literacy program is the national volunteer effort of CPAs to help all Americans understand their personal finances through every life stage. The program combines grassroots advocacy with free public resources and tools for CPAs to educate Americans of all ages. In addition, Feed the Pig, the AICPA’s award-winning public service campaign with the Ad Council, provides tools and resources aimed specifically at Americans aged 25-34, an age group that is making major life decisions, often with little financial experience or guidance.
The Reinventing Mi Retirement initiative was introduced by Governor Snyder in June 2014, and it focuses on providing financial education to help Michiganders better prepare for retirement. The initiative officially kicked off in October 2014 with eight locations in Michigan offering free informational sessions for community members. CPA members participated at locations across the state to provide free financial checkups, helping attendees gain a better understanding of budgeting and financial preparedness. Attendees also received an incredibly thorough financial toolkit, which our members contributed to as well. The event came together in just a few months due to the strong partnership we have with the State of Michigan and the incredible commitment of our member volunteers. We look forward to new initiatives planned in 2015, including events targeting younger people who maybe aren’t thinking about retirement yet, but need to be!
Today, April 1, kicks off Financial Literacy Month. In addition to our year-round efforts, the AICPA, and CPAs across the country, participate in this annual event centered on improving Americans understanding of financial principles and practices. As part of this year’s festivities, 360 Degrees of Financial Literacy has launched a newly redesigned website with an updated set of tools and resources to better help Americans understand their personal finances and develop money management skills at every stage of life.
Here are some of the other great, free events and resources to help your friends, family and clients improve their financial knowledge.
There is an abundance of terms and phrases that American’s use to make the act of savings feel less painful, like evaluating, bargaining, or prioritizing. But no matter how you phrase it, saving can be difficult for even the most responsible person, especially with matters that have a strong emotional component. For instance, when it comes to once in a lifetime events, like a wedding, people are much quicker to concede on their financial plan. In fact, according to The Knot's annual Real Weddings Study, the average cost of a wedding (excluding the honeymoon) reached an all-time high of $31,213 in 2014, up 4.5 percent from 2013. This is the fourth consecutive year of gains.
While many argue that increased spending may reflect the improving economy, The Knot’s study showed that the increase in spending goes beyond inflation and was represented across all income levels and regions. Additionally, 45 percent of couples said they strayed from their wedding budget, and 23 percent said they didn't even have a budget to begin with. From a financial planning standpoint, it may seem unreasonable to spend outside your budget, but is it any more reasonable to ask someone to concede on such an important, emotional event? Where do you draw the line?
Do you have a secret bank account or credit card that your spouse doesn't know about? Do you lie to your partner about how much you really spend? The topic of financial infidelity, whereby spouses lie to one another about money, emerged as one of the surprising topics of discussion at a recent meeting of the AICPA National CPA Financial Literacy Commission in Washington, DC.
Commission members discussed a recent creditcards.com financial infidelity report that showed that about 20 percent of people admit to spending $500 or more without telling their significant other. According to the study, men are more likely to both spend more than $500 and have a secret account.
One way to prevent this is by setting aside some time with your partner (away from busy or stressful times) and having an open discussion about your spending and financial goals. Another solution offered was to have a joint account, but open separate accounts to make individual purchases. The key is having a trusting partner with whom you can have an honest and open dialogue about your finances.
No matter how many times you may have reminded yourself, it’s a fair guess that you most likely did not completely eliminate the urge to splurge during the recent holiday season. Even though your family may have said no gifts are necessary, it can be hard to swallow the idea of showing up empty handed—my immediate family says year after year that “our presence is our present,” and yet we all show up with armloads of gifts, every year. The last thing we want is to cause our loved ones financial distress at our expense, so how do we fight the urge to splurge in the year ahead?
September is underway and that means it’s back to school for students. As teachers finalize their lesson plans, a growing number may be incorporating financial literacy education. In fact, many schools around the country have already begun integrating financial literacy into their curriculums. And it makes perfect sense.
Helping young people understand financial issues is a matter of great importance. Younger generations are facing an increasingly complex financial field, compared to their parents, and they are more likely to shoulder more financial risks in adulthood, especially when it comes to saving, planning for retirement and covering healthcare needs. On July 9, the Global Financial Literacy Excellence Center in collaboration with the U.S. Department of Education, the U.S. Department of the Treasury, and the Consumer Financial Protection Bureau hosted the U.S. release of the 2012 Programme for International Student Assessment financial literacy data. The assessment tested 15 year-olds on their knowledge of personal finances and ability to apply it to their financial problems. This is the first large-scale international study to assess the financial literacy of young people.
Summer was always thought of as the time for sunny days at the beach, BBQs and bonfires. But these days most American adults equate summer with financial anxiety, according to a recent telephone survey conducted for the AICPA by Harris Poll.
According to the survey, about 6 in 10 U.S. adults (59 percent) said their financial tension during the summer matches or exceeds the stress they feel during the year-end holiday season. The AICPA’s National CPA Financial Literacy Commission has been reaching consumers with tips to help them alleviate the stress of summer by making smart financial decisions.
This Sunday is Mother’s Day. While many mothers may be treated to flowers and breakfast in bed, it’s also a day to celebrate the strength that comes with being a mother. But sometimes, that strength can waiver when it comes to finances.
"Be Prepared, Not Scared" is what I have been telling my clients for years. This is especially important for female clients. According to a 2012-13 Prudential Research Study on the financial experience and behaviors among women, only 22 percent of women feel “very well equipped” to make wise financial decisions. A likely reason for this is that, in male-female relationships, most often the “chore” of planning is handled by the husband. My goal is to change that. While most of my married clients are men, we push to get wives involved at the earliest point in their personal financial planning engagement.
In our last blog post on crowdfunding, Charles Landes, CPA took a deep look at equity crowdfunding, specifically how the Securities and Exchange Commission rules are shaping up as required by the Jumpstart Our Business Startups Act of 2012. However, equity crowdfunding is not typically one’s first introduction to this new funding approach. Many are first introduced to crowdfunding through one of the various crowdfunding platforms that exist, such as Kickstarter. If you are not familiar with crowdfunding through a platform like Kickstarter, the concept is relatively simple. A person or company comes up with an idea, determines the cost to create this idea and sets a funding due date. Projects also feature rewards based on the contribution, for instance, backers may receive a T-shirt or the actual product they are supporting. If the project fails to meet its finance goal by the set date, then the project is not funded.
April is National Financial Capability Month, an annual event designed to help Americans improve their understanding of finances. As a CPA, you can significantly increase its value and impact, and help ensure the month is more than just a reminder to consumers to save and spend wisely. When you get involved, you can:
Help Americans build their financial understanding and capabilities
Strengthen and advance the CPA profession
Give young CPAs an opportunity to develop leadership skills
While many CPAs are in the depths of tax season right now, sports fans are entering the height of the college basketball season: March Madness. Even the most lackadaisical college basketball fan can’t help but get into the spirit. It also can be a prime time for overspending, whether buying rounds of drinks while watching the game at the bar or participating in the office pool. Although the NCAA tournament may be a one-and-done system, CPAs know all too well that this is not the case with personal finances.
The commonsense financial approach to events like March Madness are usually your typical stick to a budget, think before you spend, etc. But often no matter how many “tips to save money” you put out there, consumers are still drawn in by the pressures of friends, family and the media. While the individual consumer may know all the tips and tricks and understand the impact their decisions will make, that doesn’t mean it’s easy, and it doesn’t mean they’ll do it. So how do we, as professionals in the finance community, combat this? How do we change the thinking of Americans to one be focused on financial wellbeing?
Whether we like it or not, emotion plays a part in almost everything we do; from making a move at the end of a date to hitting the snooze in the morning before work. Emotion is that little bug in your ear that can sway your decision making, no matter how logical you may try to be. That’s why strong emotions, such as love, can make you feel so crazy.
I’ve worked on the Feed the Pig campaign for several years, and as a member of its target audience I know firsthand that emotional spending is a common struggle for my peers. This is especially true when it comes to holidays, like today, Valentine’s Day, when Americans feel compelled to spend that extra dollar to show someone that we care, no matter how unnecessary and unrealistic it may be.
A few weeks ago, we sat down with National Financial Literacy Commission members Kelley Long, CPA/PFS, and Clare Levison, CPA, for a Facebook chat with consumers about finances and the role that emotions often play in our decisions. Here are a few of the top Q&As from the event:
“Life's most persistent and urgent question is, 'What are you doing for others?'” – Martin Luther King, Jr.
Today we celebrate Martin Luther King, Jr. Day, a day commemorating the extraordinary work and sacrifice of an incredible man; a day when people across the country strive to answer King’s question by coming together to serve their neighbors and communities. King is best known for his dedication to the advancement of civil rights, and, in his later years, poverty eradication and economic justice.
The MLK Day of Service is part of United We Serve, the President's national call to service initiative, asking Americans from all walks of life to work together to provide solutions to our most pressing national problems.
In a recent post I detailed a number of articles highlighting tax tips provided by AICPA staff and members that individuals can use to save themselves money when they file their 2013 returns.
As the calendar flips to 2014 (the year of the polar vortex), AICPA members and staff have been providing guidance on how to ‘recover’ from holiday spending, save more in 2014, and outlining tax changes that may impact consumers.
“When she said ‘I just paid off my student loans,’ I thought, WOW how did she do that. It makes you think what’s important and what’s not.”
“I like the positive role model thing. I want to be this guy.”
These quotes are just a small sampling of feedback from the Feed the Pig’s target audience (25-34 year olds) after viewing the campaign’s newest PSAs during focus groups held earlier this year. Each TV spot highlights both the positive financial behavior—buying a home, saving in a 401(k) and paying off student loans—of one young adult or couple paralleled with the spending habits of their peers, who simply cannot believe there’s any money left over at the end of the month to save. (View all the new PSAs on the new Feed the Pig website.)
The AICPA is gearing up
for our Fall Meeting of Council, which begins Oct. 20 in Los
Angeles. Be sure to follow @AICPA_JofA and @AICPANews on Twitter and subscribe to the AICPA’s
Press Center RSS feed to keep up with all the
news and information coming out of the meeting.
In the meantime, I’ve
highlighted a few recent accounting articles in the news that you may missed
over the last week.
Today covered the recent written
testimony that the AICPA submitted for the record
of the House Small Business Committee’s hearing on retirement savings for small
employers. In the testimony Jeffrey A. Porter, AICPA Tax Executive
Committee chairman, suggested several ways to simplify the complexity of the
retirement planning universe.
“When a small business grows and begins to explore options
for establishing a retirement plan, the alternatives, and the various rules,
can become overwhelming,” he wrote in his testimony.
More than sixty-five million Americans are serving as volunteer
caregivers for vulnerable loved ones – and as baby-boomers step into senior
status, that number will rise. Caregiving for someone with a disability,
lengthy illness or aging issues is challenging enough, but adding money concerns
to the mix can create a massive strain on individuals and families. Caregivers
find themselves thrust into roles they are poorly suited to maintain. Juggling
medical, relationship and job-related matters can often pale in the face of the
financial pressures of caring for someone who is chronically ill or
The key is sustainability – and in order to manage the massive
bills, extra costs and nuances of the tax code, I have found that I require the
help of a trained professional, specifically a CPA.
Throughout history, our returning veterans have always faced
challenges. However, recent reports have troubled
me, showing that returning vets are facing more challenges than ever before.
to a March 2013 study published by the Institutes of Medicine at the request of Congress, almost
half of the 2.2 million troops deployed in Iraq and Afghanistan report difficulties
on their return home.
After recently being reintroduced to the reality of my student loans and how slowly I was chipping away at them—oy, the interest—I came to the conclusion that it was time for a budget revamp. I sat down, mapped everything out and determined the only solution was to relive my college days and go on the all Ramen noodle diet. While I usually pride myself on being a “frugal foodie,” the thought of hot noodles during the hot summer was not appealing, no matter how many variations I could make. Luckily, I travelled down to Philadelphia the following weekend and was reintroduced to the beauty of fresh farmers’ stand produce through a visit to the Italian market.
When I graduated from college I thought I had all my finances under control. Sure I had some student loan debt, but I had been able to get through four years with only the equivalent of one year’s worth of expenses and tuition in debt; compared to those with hundreds of thousands of dollars in student loans, I felt pretty good. Then I entered the “real world” and everything changed. I’ve been out of school four years now, paying the optimal monthly payment on my loans every month, and I’ve barely made a dent.
As a student applying for loans, I assumed that as long as I made my monthly payments I would see the number go down, plain and simple. I figured that those high school teachers I had that were still paying down their loans in their 40s must have put off payments or took out enormous loans; why else would it take that long? As the reality of the situation sunk in, and I realized the impact of this magical “interest rate,” my student loan debt suddenly felt much heavier. And I’m not alone. According to a recent survey conducted on behalf of the AICPA by Harris Interactive, only 39% of respondents fully understood the burden student loan debt would have on the future, and a whopping 75% have made a personal or financial sacrifice because of monthly student loan payments, like postponing getting married, having children, buying a house and saving for retirement.
This spring I proudly watched my little brother graduate from college, but as I looked out at the sea of graduates, my mind couldn’t help but think of the immense amount of student debt that lay before many of them. Lucky for my brother, working at the AICPA and with our members has given me access to a treasure-trove of tips and information for managing and paying down student loan debt. Here are a few basics that I passed along to him from 360 Degrees of Financial Literacy.
read so many great quotes from CPAs every day and have such a limited space to
summarize them on the blog– it can get to be a bit frustrating. As I began drafting my bi-weekly ‘In the
News’ post, I decided to switch things up this week.
present to you four helpful quotes from CPAs. Hey – everyone can use a little
help now and then.
As Kelli Grant reports in MarketWatch, going to summer camp
may be a rite of passage for children, but for parents, it seems more like an
initiation into the woes of tuition payments.
What parents might not know is
that camp expenses can translate into a tax break.
According to a new survey
conducted for the AICPA by Harris Interactive, only 39% fully understood the
burden student loan debt would place on the future and 60% have at least
some regret over the choice of education financing. Furthermore, 75% have
made a personal or financial sacrifice--such as delaying a home purchase and
postponing marriage and children--because of monthly student loan payments. The
press release includes
tips for parents and students on both saving for college and managing loan
payments. The below 360 Degrees of Financial Literacy infographic, Realities & Regrets of Student Debt, highlights the
Americans money stress brought on
by lighter paychecks this year is affecting more than their wallets — it’s
taking a toll on their waistlines, friendships and the amount of sleep they get.
That’s according to results of a new survey fielded for the American Institute of CPAs by Harris Interactive in recognition of National
Financial Capability Month.
The telephone survey, conducted between March 14 and March 17,
asked 1,011 U.S. adults to name all the ways financial stress is affecting
their lives. Of those who rate their financial stress “very” or “somewhat
high,” almost half, 47 percent, said they are sleeping less; 43 percent said
they have less patience with friends or are seeing them less often and 31
percent are eating more junk food or gaining weight.
financial literacy continues to be one of the most gratifying activities of my
career. Although it requires a portion
of my already limited time, the rewards (tangible and intangible) are
tremendous. Following are the reasons I think public
service via financial education is important to us as individual CPAs as well
as to our profession.
The Need is Great
education is not taught in our public schools and our economic/financial
environment continues to become increasingly complex. Many people do not have
the basic information they need to make financial decisions and they don’t know
whom to trust. There are large segments of our population who need the
professional, objective advice that CPAs can give, but who cannot afford the
fees: teenagers and college students, the elderly and middle/low income adults,
to name a few.
April is Financial Literacy Month! This annual event is centered on improving Americans’ understanding of financial principles and practices. During this time every year, the AICPA and state CPA societies bolster financial literacy efforts with added events and resources.
Even with the craziness of tax season, it is amazing to see the dedication of CPAs across the country. Here is just a sampling of the various financial literacy events taking place this month.
The Texas Society of CPAs is encouraging families to participate in their 30 Days of Personal Finance. They’ve posted 30 tips for each day of the month, ranging from creative savings ideas to budgeting tips.
The New Mexico Society of CPAs will speak on financial literacy at an Albuquerque middle school on April 22. Three CPA volunteers and a NMSCPA staff member presented at the event last year, and it was so successful for the school that they have decided to make it an annual event! You can see pictures from last year’s event on their Facebook page. This year they will be giving away Feed the Pig and 360 promotional materials to kids and parents, in addition to raffling off copies of Save Wisely, Spend Happily; a copy of the book is also being donated to the school’s library.
wilted flowers and almost empty boxes
of chocolates can only mean one thing: Valentine’s Day was last week. According
to some estimates, as many as 200,000 couples across the United
States choose this date to become engaged. Congrats to all the lovebirds out
before these happy couples tie the knot, they’ll need to make sure they’re on
the same page when it comes to their finances – otherwise, problems will likely
It seems like every time I turn on the TV or open a magazine, there’s some new fitness miracle, whether it’s equipment, classes, cleanses or clothing. And, of course, they all come with a price, usually not within the typical young adult budget. While fitness is important for people in all age groups, it seems to be taking on a whole new import with Generations X and Y. Gym memberships or fitness classes are now a staple in the standard budget, and eating organic seems like a no-brainer trade-off for the higher cost. All of this is well and good from a health standpoint, and in the long run will ideally lead to fewer health care costs down the road, but there’s something big missing from the average American’s budget: saving.
I’ve been saving since before I knew what the term saving meant; I had some wonderful relatives who knew how much I would appreciate savings bonds down the road. When I started working at
the age of 16, the saving continued, with me socking away every paycheck apart from the money I needed for gas. Even when I started my first job out of college, I still found saving easy, and didn’t understand why people just didn’t “get it.”
It seems you can’t turn on the news without hearing at least one story about money. Saving, spending, debt, budgeting…the topic of finances is everywhere, except, however, in the homes of consumers. According to a recent Harris Interactive survey conducted on behalf of the AICPA to promote the new consumer book Save Wisely, Spend Happily, only 14% of Americans identify financial problems as something they would feel comfortable discussing. What’s more, 28% say they have no one to ask for financial advice. When it comes to family and finances, shouldn’t loved ones be allies?
In my professional travels I meet individuals from all over who know about the AICPA’s financial literacy programs and use our resources in many creative ways. While some are CPAs, the majority is not, and yet each is equally committed to improving the financial well-being of their loved ones, friends and communities. If I had a dollar for every time someone sang “Feeeeed the PIG!” to me after seeing our campaign promotional items on a conference display table, I just might have enough money to pay off my student loans. (I never get tired of this serenade!)
Here are some of the many ways these free resources are being used:
The first day of the fall meeting of the AICPA governing Council kicked off on Sunday. Follow the "read more" link for a look at the day through the eyes of social media. (If you're viewing this post through our email subscription, depending on your email client, you may need to click through to read the story.)
Over the past few weeks, kids across the country packed their backpacks and headed off to start the new school year. I still remember the mix of excitement and apprehension I felt as I laced up my new sneakers for the first day—they were the “special” annual back-to-school purchase in our family. The preparation for school may vary between households, but it can be agreed that every parent wants to set their children up to succeed. While there are many factors that may be out of a parent’s control, teaching kids good financial habits, like saving, can give them the best opportunity for a financially stable future.
To help kick off the school year, Feed the Pig hosted a live Q&A on Kids and Money, with National CPA Financial Literacy Commission members Kelley Long, CPA and Clare Levison, CPA. Here are a few of the top questions and answers.
When I reflect upon my childhood, I fondly recall my elementary school days at P.S. 116 in Manhattan. Despite enjoying school, my favorite time of the year was when I would proudly present my parents with my final report card of the school year. The reasons for this were two-fold: like most kids, I always looked forward to my summer vacation, and I knew that if I got good grades my parents would reward me with a gift of my choice (usually a Nintendo game).
As I turns out, I wasn’t the only kid being compensated for doing well in school. According to a recently released AICPA survey on how parents treat the subject of money with their children, 48 percent of parents say that they pay their kids for getting good grades. As CNN Money noted, the survey showed that the going rate for an ‘A’ is $16.60, which makes me think my parents were getting off easy back in the day.
A Bankrate.com article titled “Four Ways to Avoid Dipping Into Your Savings Account” quoted Kelley Long, a Chicago CPA, personal finance coach, and member of the AICPA’s National CPA Financial Literacy Commission. In the article, Long provides prudent advice on how to keep the money currently in your savings account right where it is. She suggests savers don't get an ATM card or sign-up for Internet account access - because it provides the user with hassle free access to their savings. For more savings tips, please visit 360 Degrees of Financial Literacy, a free program of the nation’s CPAs to help American’s understand their personal finances through every life stage.
Heading off to college can be one of the most exciting times in a person’s life, especially if it’s your first time living away from home. I still remember the thrill of living with no parents for the first time. That thrill soon wore off when it was time to pay the bills—between books, groceries and my tuition, I didn’t understand how I was supposed to handle it all on my own. Fortunately, student loans showed up to save the day, sort of.
Although student loans made school financially possible, the reality of the debt I was accruing was completely off my radar while I was in school, as it is for many college students. Even with the post-graduation repayment grace period it was still difficult to pull together my loan payments the first few years; I was even one of the lucky ones who found a job the summer after graduation. In today’s economy, and with today’s unemployment rates, it’s a stretch to think that all graduates will find jobs within six months, let alone be on their feet enough to begin repaying their debt. Now, millions of college graduates may see their payments jump.
Every year, politicians, economists, tax practitioners and others talk about making changes to our federal and state tax systems. Some of the proposed changes are more fundamental – the adoption of a consumption tax, for example. Other proposals, on the other hand, call for varying degrees of modification to the existing system, such as adding or expanding tax incentives to encourage savings, modernizing the international tax rules, or making procedural changes to improve compliance.
In a presidential election year, and at a time when our country faces unprecedented levels of debt and extraordinary amounts of governmental-operating deficits, taxes will continue to be one of the most pressing issues for public discourse. Have you heard any of the candidates mention the “T” word lately? We all know, however, that talking about taxes in this environment takes a lot of political courage.
Relationships and finances can be very tricky; whether between parents and children, roommates or spouses. In fact, financial matters are the most common source of discord among American couples, prompting an average of three arguments per month, according to a survey conducted for the AICPA by Harris Interactive.
More than half of adults, 55 percent, who are married or living with a partner said they do not set aside time on a regular basis to talk about financial issues. This leaves them at a huge disadvantage. It’s important for all parties involved to be aware and understand where their money is going.
I recently read a blog post that talked about ‘the loop,’ which is essentially the browsing cycle we go through on the internet. This caused me to reflect upon my own habits on the web when I’m home relaxing in front of the computer. I found out that I have a regular routine of scanning the news, checking for any new sports information, seeing what my friends had for breakfast on social media and ensuring any emails are responded to promptly. I do this two or three times on an average night and as many as a dozen times on the weekends (please don’t judge me).
However, I’ve recently made it a point to expand the loop at least once daily to include checking my bank account and recent credit card spending, as well as my 401(k) and investment portfolio. Because as Jordan Amin, CPA, chair of the National CPA Financial Literacy Commission puts it, “the first rule of personal finance is be informed.”
As in past years and with previous presidents, President Obama proclaimed this April as National Financial Capability Month. Financial capability, referred more frequently to financial literacy, means possessing the financial skills and knowledge required to confidently make smart decisions on a variety of financial matters. One can fairly assume that CPAs possess these necessary skills, but what about your non-CPA colleagues and co-workers? This month, the findings of several annual surveys are released which highlight the current state of American’s finances, and based on some of this year’s results the financial capability of the average American worker is unfortunately low.
The end of tax season is fast approaching, and CPAs everywhere are no doubt looking forward to the end of their busiest time of the year. Although I bashfully admit that my returns still have yet to be filed, I see this time of year as a prime opportunity for me to take a good look at my finances. Sure I keep the typical year-round budget, and do my best keep my finances in check, but there are always places for improvement. Since joining team AICPA, I have realized, more than ever, that year-round tax planning can truly help prepare you for life changes, while staying on track to achieve financial goals.
The National Association of Colleges and Employers recently released the findings of their latest Job Outlook survey, which contained good news for current accounting students as well as recent accounting graduates. According to the survey, accounting majors who graduated in 2011 earned an average starting salary of $50,500, up 3.7 percent from the previous year and roughly 20 percent more than the average starting salary of all graduates. This increase isn’t an anomaly, according to Andrea Koncz of NACE, who told FINS.com that "entry-level accounting and finance jobs tend to see steady growth from year to year."
The AICPA, in partnership with the Ad Council, launched the next phase of its award-winning Feed the Pig campaign with the release of new public service advertisements. The new PSAs promote the key message: “Put away a few bucks. Feel like a million bucks.” In connection with the new PSAs, they also created this excellent infographic highlighting tips on saving money. DailyInfographic.com even picked it up. Click on the image to enlarge.
Do you happen to be one of the many people who has resolved to make saving money a priority this year? Do you also find yourself in the category of those who feel they cannot even save $25 a week? If so, Mackey McNeill, CPA/PFS, a former member of the AICPA’s National Financial Literacy Commission, has offered some actionable tips to help you painlessly save $1,000 this year in an article appearing on depositaccounts.com.
McNeill suggests finding your largest discretionary expense and challenging yourself to spend 5% less. For example, if you spend $400 a month at the grocery store, make it your goal to reduce that figure to $380. The 5% challenge works because it doesn’t feel like a huge sacrifice, but $20 over the course of a month translates to a cool $240 a year (full disclosure: I was a math minor).
If you’ve watched the news, picked up a paper (or read one on your electronic device) or listened to the radio in the past year, you’ve probably heard about America’s debt, its bond rating and political gridlock.
Instead of telling you what fiscal challenges our country is facing, I think it’s better if you understand them for yourself. Today, I’m encouraging each of you to spend a few minutes taking a short quiz that will test how well you understand the financial matters being discussed in Washington, D.C.