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May 10, 2012

12:01
P.M.

Color of Money Live

Total Responses: 34

About the hosts

About the host

Host: Michelle Singletary

Michelle Singletary

Singletary writes the nationally syndicated personal finance column, "The Color of Money," which appears in The Post on Thursday and Sunday. Her award-winning column is also carried in more than 120 newspapers. In her spare time, Singletary is the director of a ministry she founded at her church, in which women and men volunteer to mentor others who are having financial challenges.

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Host: Erin Duffy

Erin Duffy

About the topic

Join The Washington Post nationally syndicated personal finance columnist Michelle Singletary Thurs. May 10 at noon ET. Singletary will be discussing her April Color of Money Book Club selection, "Bond Girl" by Erin Duffy, a former Wall Street worker who has written an engaging novel about a young woman's entry into what's still largely a man's world. Duffy will be Singletary's guest and available to take your questions about her book and her time on Wall Street during the height of the financial crisis. During the chat, Singletary will also be available to answer your personal finance questions.
Q.

Michelle Singletary :

Thank you for joining me today. In addition to taking your personal finance questions, my guest will be taking your questions. I'm joined by Erin Duffy, who has written a novel about a new college graduate, Alex Garrett, who takes a job at a high-powered fake Wall Street Company. It's a sort of coming of age in the age of Wall Street excess. Quite an interesting read. It was my Color of Money Book Club pick for April (scheduling issues pushed the discussion to today).

Anyway, Erin is here and read to take your questions about her book and her time on Wall Street especially during the peak of the recession bust.

So let's get started.

Q.

Duffy

How much sexual misconduct did you encounter working on Wall Street?
A.
Erin Duffy :

Hi!

I didn't start on Wall Street until 2000 and attitudes had changed dramatically since, say the 80's. To be honest, I had it luckier than some other women I know. Aside from the occassional questionable comment, I didn't experience anything as major as what Alex did. 

– May 10, 2012 12:02 PM
Q.

Credit Car Roulette

On the back of you book you list the top ten things people probably don't know about working on Wall Street. No. 1 is Credit Card Roulette. What is that? Did it happen to you?
A.
Erin Duffy :

ahhh! Credit Card Roulette is a time honored tradition to determine who will pick up restaurant checks. Everyone at hte table throws their credit card into a hat, (and if one isn't present, they are shuffled like cards under the table), and one by one each card is pulled from the pile. The owner of the last card pulled pays for the dinner. Yes, that has happened to me! I only lost once or twice, thankfully!

– May 10, 2012 12:03 PM
Q.

Roth TSP

Hi Michelle, Have you written or will you be writing a column on the upcoming Roth TSP option for federal employees? Thanks!
A.
Michelle Singletary :

I haven't but I'll look into it and add it to my list of column ideas. Thanks.

– May 10, 2012 12:04 PM
Q.

Government job

Michelle, I'm pretty sure what you're going to say, but I need to hear youy say it. I'm in a stultifying mid-level government job, spend most of my time surfing the internet, and am just bored silly. I've tried to get more interesting assignments, or any assignments at all, to no avail. However, I'm a 48 year old high school graduate making high five figures with five weeks vacation, 11 paid holidays and terrific health benefits. If I last another seven years, I can reetire with a high five figure pension, $200,000+ in my TSP plan and continue my health benefits. Even with possible freezes or cuts to federal pay or benefits, that's still a pretty good deal, right? I'm trying to broaden my interests outside the office but still dread heading out each day to eight hours of total boredom. I do check available goverment openings almost daily so maybe I'll find something soon, however most at my level now require some college, which I don't have.

A.
Michelle Singletary :

Yup. Going to say it. You are blessed. Keep working. Now there are probably some people reading this who will fume that you are so highly paid with "our" money for doing not much work. And they would be right. The government should be using you better. Certainly it's maddening that you make so much when others working so much harder get paid so little (teachers come to mind).

But I understand where you are coming from. I understand your clinging on to financial security. 

So how about taking some of your savings and get a degree? If you don't have all the money save (outside your retirement plan) save up to get a degree or certificate or training in a field that will help you get another government job or a another job period that's more challenging, worthwhile, etc. 

– May 10, 2012 12:10 PM
Q.

Bond Girl

Why did you write this book? Was it a way to get back at some of your treatment when you worked on Wall Street?
A.
Erin Duffy :

To be honest, it was quite the opposite. I wrote this book originally to try to humanize some of the people who work in the industry. There is so much venom right now for the financial sector as a whole, and that's hard to argue with. I thought people would be surprised to learn a little bit about the psychology of the people who work on Wall Street, but I didn't write it to exact revenge on anyone. I hoped to make people laugh more than anything.

– May 10, 2012 12:11 PM
Q.

Bond Girl

Can you list the things a young woman could take from your book that will help her on her job, especially those women about to graduate? What helped you when you got your job on Wall Street?
A.
Erin Duffy :

It really is hard to prepare for life on Wall Street until you get there, it's a career that requires you to learn as you go. If you're a woman considering a career in finance, there are a few things that you need to know before you start. You need to be tough. It's not an industry that coddles the new kids, (male or female, it's the same for everyone). You are held to high expectations and there's not a lot of room for error, so it's important to stay tough, and stay focused. It's a stressful environment, but also a fun one. Young women need to be comfortable working in close quarters with a lot of aggressive men. It's not an environment for everyone, but if you have the personality to handle it, and are prepared to work hard and sacrifice a lot of your personal time in the early years, it's a great career. 

– May 10, 2012 12:15 PM
Q.

Bond Girl

How much of the book is based on real events?
A.
Erin Duffy :

This is one of the questions I've been asked most frequently. The book is a work of fiction, but of course I drew on some of my own experiences when writing it. I took some license to exaggerate and twist events in the book that may have had some basis in reality. I will tell you that the role of food on the trading floor as depicted in the book is very real! 

– May 10, 2012 12:16 PM
Q.

Sympathy

My sincere condolences for the lost of your brother. I understand your heartfelt column about parents making custody decisions about their children. We made arrangements in our child in our will. Ironically, she would ask about once every few years, "if something happened to you or Dad, what happens to me?". Knowing what would happen gave HER a piece of mind. We told our decisions to our parents, siblings and the future guardians got a copy of the will. If folks don't think it won't get ugly about who has custody of your child or children, think about it. Every child's guardian will have total access to your child's Social Security check. How many of your relatives would fight over access to a Social Security check of $500 to $1,000 a month for 8-10 years?
A.
Tia Lewis :
– May 10, 2012 12:19 PM
A.
Michelle Singletary :

Thank you for your kind words. And you make great points.

I also loved that you have not just gotten a will but talked to your child about it and the people around you. That's the other thing. People don't want to share what their wishes are because they don't want to hurt people's feelings. But guess what? They will get hurt and probably more by not knowing until you pass away. 

– May 10, 2012 12:19 PM
Q.

Creating a Budget

I have a few questions about creating the budget. I get paid bi-monthly. I entered all my income and expenses in the spreadsheet. However, my calculations are incorrect. How do we calculate pre-tax deduction? In addition, what if our water, sewer, trash and taxes are included in our monthly rent and mortgage but it is making one exceed the target rate?

A.
Michelle Singletary :

I budget based on "net spending amount." That's what I have to spend after taxes and tithes. For you it might just be taxes. But the point is you have to look at what you really bring home AND then adjust your spending, expenses to meet this net amount. As for expenses that aren't monthly -- car insurance or water bill -- take the total cost and divide by 12 (12 months) then set asid that amount every month in a savings account so that when that bill comes you have the money. If an expense -- trash, water, sewer -- is included in your mortgage you can back it out to get to the target rate of what is reasonable for your housing expense. Typically about a third of your net pay. However if you are already set at a certain housing expense and it's over the target rate (30 to 6 percent) you'll have to cut other expenses to make the larger housing expense work in your budget.

– May 10, 2012 12:23 PM
Q.

Student loan debt

Hi Michelle, I make a good income and so does my husband. However, I have a large amount of student loan debt. I have moved past the stage of deep regret because it is too late now, and I am concentrated on paying it off as quickly as possible. I have paid off a considerable amount considering all of my other financial obligations and helping out my family. My husband and I are very frugal, but we do enjoy certain things because life would be rather unbearable. My question is - we want to have kids. But I don't feel comfortable raising kids with this large amount of debt. I would rather pay off all my loans first. But that would take years, even at the accelerated rate we are paying it off. What would you advise? My husband understands my concerns, but he says we don't have to 100 percent debt-free to have kids - that there is a middle ground.....but what would that be?

A.
Michelle Singletary :

Of course I can't tell you what the middle ground is for having kids.

If you want kids and age is a factor in having them and you don't think you can get rid of this large amount of debt, then you'll have to do a lot of calculating to see if the expense of having the children will work in your budget. What can you do to cut other expenses and I mean really cut. Perhaps the added cost of daycare (if neither of you are going to quit work) and all the other child care expenses can be handled in your budget while you still aggressive pay off the loans. But you won't know until you factor in the expenses and see where it leaves you. 

So do the math. Be realistic. Then decide.

– May 10, 2012 12:26 PM
Q.

Michelle Singletary :

Erin, you just said that "there is so much venom right now for the financial sector as a whole" to support your writing the book to point out that there are good people working on Wall Street. But there are a lot of money grabbing people who threw us under the bus. What do you say to people who can't trust Wall Street folks.

A.
Erin Duffy :

Sure there are. Unfortunately like in every industry, a few bad people ruined the reputation for hundreds of thousands of others. The system failed due to poor checks and balances and yes, some people in positions of power who were careless with their responsibilities. No one can really argue that. I was laid off myself as a direct result of that, so I understand it. I think for me, the main point I had hoped to make was that the rank and file guys (and gals) who were on the trading floors every day, doing their jobs, working hard, weren't the ones making decisions that resulted in the crisis. Unfortunately, the ones who made the headlines became the poster children for all of us. I understand the skepticism, and if nothing else, there have been reforms made to industry regulations that may well have been overdue. Hopefully some trust can be restored going forward.

– May 10, 2012 12:27 PM
Q.

government job

It's not just tough to read about "government job's" problem when my spouse has lost two jobs in three years and would dearly love to work. It's even tougher to read that they get a pension and long-term financial security. I hope this person can see beyond their own dissatisfaction and personal fulfillement needs and ask themselves how to use their time to give back, rather than just surf the Internet. Certainly after retiring and continuing to collect money. And when you do leave the job you might suggest that the position be eliminated.
A.
Michelle Singletary :

First, not all gov't workers get such a generious pension. Many are on the new system where they have to save for thei own retirment. But you do make a good point about suggestiong the position be eliminated if it's not needed.

– May 10, 2012 12:28 PM
Q.

For the fed worker

Look into details. You can find short details (anything from 2 months to 12 months) where you can do work on a high priority project that needs people for a short while and then go back to your regular job. Details can give you variety and often interesting work because it is high priority. Also, start to look into volunteer organizations outside of work that appeal to you. You may find that you can find an avocation that will consume your time and interest after you retire. Think about what you like to do and then try to find volunteer organizations that support it. For example, if you like to see theater, volunteer as an usher at theaters. If you like to support charities, try to be a kitchen volunteer at a food kitchen or one of the key volunteers for the various "races/walks" around town. If you like books, check into the volunteer opportunities at your local library. There are thousands of volunteer opportunities in this area. There is likely one that will match up with one of your interests.
A.
Michelle Singletary :

Thanks. Good advice.

– May 10, 2012 12:29 PM
Q.

Patience

Michelle, I'm doing the hard work and paying down my debt. But now I feel...bored. Not because I can't spend money but more like...when I was making the plans to do this I felt like I was doing something useful and now I'm just playing the waiting game and twiddling my thumbs. How do I deal with my impatience in this?
A.
Michelle Singletary :

When you feel bored with paying down you debt look at the statements when the debt was higher. Look at how the debt is going down. Remind yourself how horrible you felt being so burden by the debt. Replace the feeling of twiddling your thumbs with the fist pumping you will do when it's all over. And trust me, you will. And all this waiting will have not been in vain.

– May 10, 2012 12:30 PM
Q.

Career Change

You obviously made a career change... and a career change that probably set you back financially. How did you make that decision? I'm struggling with that decision myself - I currently have a high-responsibility job but make lots of money. I'm considering taking a lower-responsibility/higher fulfillment type job but would probably be a 20 percent pay cut.

A.
Erin Duffy :

I still struggle with it, sure. It's hard when your identity is kind of wrapped up in what you do, and it was the only job I knew so it was very hard to walk away for something completely different! For me, I just felt like if I didn't try it at that point in time then I was never going to do it. It was a risk for sure, but I really didn't think I wanted to be sitting in the same chair ten years from now working like a crazy person anymore. Twelve years was enough. There are trade-offs to be sure, but when I weighed my options I thought it was worth it. Not having that alarm go off at 5:30 every day is worth a lot to me!

– May 10, 2012 12:31 PM
Q.

Bond Girl

In your bio, it says you got downsized out of your job on Wall Street. How did that make you feel?
A.
Erin Duffy :

I did. And I wasn't alone by a longshot. To be very honest, it made me sad for a few reasons. One, it's never nice to be unemployed. Two, I felt a lot of pride for the place that I worked and to see what happened to it in such a short period of time depressed all of us. One thing about Wall Street though is that there really is no job security. Everyone knows that, so it's just an unfortunate aspect you need to embrace if you want to work there. At that time, especially, everyone knew that their jobs were on the line. I was one of I think five people let go from my team alone on one day. It was a bad time for everyone.

– May 10, 2012 12:31 PM
Q.

Credit Cards

For years, I have had only one credit card. It was all I needed. But, then while I was at a convention in Kansas City someone started using a cloned copy of my credit card. I don't know if my card was skimmed there or sometime weeks or months earlier. The credit card left a message on my home answering machine so I didn't find out until I tried to use my card to pay for the checked bag fee. Suddenly, having only one credit card was a problem. The credit card company was able to allow that transaction, but I was without a credit card for a week waiting for a new card to be issued and mailed to my home address. I didn't enjoy being on a cash only diet. I tried to apply for a second credit card with another company, but was declined... I am still waiting for the official response, but I think it is likely related to the fact that almost two years ago someone had opened a credit card under my name but using my parent's home address. I had put a freeze on my credit at the time. What do I need to do to actually get the second credit card?
A.
Michelle Singletary :

I know it was a pain. But it worked out in the end. Yes, a little trouble but it worked out. You don't "need" a second card.

Just keep an eye on the card you have, checking the statement, etc. 

You might also call the credit issuer for your one card and give them your cell phone number in case this ever happens again. Or sign up for electronic notices. So in the future if your card is misused you can be contacted by other means.

 

– May 10, 2012 12:35 PM
Q.

Bond Girl

Erin, Is it true that the wall street firms in most instances just care more about pulling in the money than doing what is best for the client? Or is that just media and Hollywood hype?
A.
Erin Duffy :

The media and Hollywood have not helped that perception any, that is for sure. I know where I worked, our mottos were "the client is always right," and "care for your clients." There are people who have been doing this job for 25 or 30 years, they wouldn't be able to have relationships that endured that length of time if they weren't looking out for their clients. Are there some people who probably don't value client's interests above their own? I would bet there are. Again, they are outliers. The vast majority of people I encountered knew that client happiness ensured their own livlihood. Messing with that didn't make a whole lot of sense!

– May 10, 2012 12:36 PM
Q.

Government Job

I am more turned off by the people responding with venom towards this man. It's not really easy to "give back" during the work hours. Well that is unless he wants to get himself fired for leaving the office to go volunteer. He wants to be more productive and he is not the correct person to be taking your anger out on. I am sure you wouldn't shoot yourself in the foot financially like you are asking him to do.
A.
Michelle Singletary :

Hey, hold on.

I didnt' get venom from people. And I assumed the advice about voluneer was meant for after or before work hours. I'm sure that's what they meant.

I understand both sides. I wouldn't leave a good-paying job in this economy. But I would as some have suggested try to continue figuring out a way to be more productive on the job. Perhaps help another co-worker who is swamped if possible. 

At any rate things are tough for a lot of people and it's hard hearing someone is making good money with little effort. I think that's all folks meant.

– May 10, 2012 12:39 PM
Q.

Your great advice pays off - literally!

Just wanted to let you know that your "Life happens" fund is fantastic!!! We set aside a couple hundred a month in a combination "life happens/gift/small house-projects" fund. well, this month, it ALL happened! We had saved up to get some projects done, so a couple thousand for that. Then my son and godson's birthdays are this week. Oh, and my niece graduates next week! And now we have to buy a new motor for our 1999 car (cheaper than a new car!). It's going to hurt to see the account balance drop several grand in a month's time, but at least we know we have it covered! I just hope we get a couple months break before the next "life happens"...!! Thanks again for your sound advice!
A.
Michelle Singletary :

I love it when people testify and especialy about the concept of the "life happens fund," which is separate from having an emergency fund.

So thanks for the testimony!

– May 10, 2012 12:40 PM
Q.

What to do next?

I feel guilty asking this but I think it's a valid question. I'm early 30s, single, no kids. I make a good income (about $130,000), paid off my mortgage in 2011, no student loans (wonderful parents), no car loan (although I may need a new one in a few years), basically no debt and maxed out 401(k). Since I've paid off my mortgage I have just been building up cash in the bank and have about $55,000. I'm not sure what my next goal should be and I feel that I'm an idiot just letting the bank account grow. I am so frugal and spending little each month (groceries, utilities, insurance, etc) that the balance is growing quickly and I'm not sure what to do. I've thought of buying another home but I've heard horror stories about being a landlord. I feel untrusting of financial advisors. What should I do? I am in a serious relationship and think we may marry so maybe I should just keep saving and likely buy another home after we are married? I don't think we plan to have children to save for.

A.
Michelle Singletary :

Why should you feel guilty for being a good money manager? Good for you.

But don't spend because you think you have to. Why don't you do a long-term plan and see down the road what you might need. Perhaps you want to hang on to your current home and have a retirement home in some great warm place. If so, then save up to pay CASH for the second home. You say you might get married. Save up for the wedding or the costs to move. 

Or maybe you haven't considered charitable giving? Or are there relatives who could use some financial assistance? A relative in college piling on debt? Maybe you can pay for a semester or two.

Look at your future and beyond your needs (and wants) and you can find ways to spend the money in a responsible way. 

If not, did I mention I have three kids to put through college :)

– May 10, 2012 12:45 PM
Q.

Working

So what general advice would you give to new college graduates about to start working full-time in the real world?
A.
Erin Duffy :

Be professional! One of the most common things I always noticed about the new kids when they started was which ones really wanted to be taken seriously. They came in early, they dressed professionally, they asked smart questions. I think sometimes it's easier to worry about being accepted above doing the job well, in any industry. I always found the kids who cared more about impressing their boss with their work ethic and not with how late they could party with him fared better.

– May 10, 2012 12:45 PM
Q.

Bond Girl

So is your new writing career paying off? You are doing what a lot of people wish they could, write and get a book published. Making any money? What about long-term? Can you be honest for those people wanting to be where you are?
A.
Erin Duffy :

I will be honest, but I think you'll be surprised by the answer! I have sold the option for the move rights, so that is encouraging, and I have sold a second book that I am working on now, but the way that payment works in this industry is very differnet than what I am used to. If Bond Girl sells above a certain threshold I will receive some money for it in July, but the days of reliable paychecks are gone, so it's important to budget my money and prepare for disappointment. Long term, I'm honestly not sure. What's crazy about being a new writer with no name recognition is that you have no idea if people are going to like your books or not. I have no control over any of it, which has also been hard to accept. I am cautiously optimistic but I have not completely ruled out the possibility that I may be looking for a job back on the Street at some point down the road. Even if that happens, I'm glad I gave it a shot. One thing I will say that made this a little bit of an easier decision for me is that I am single and don't have kids. I rent in NYC, so I don't have a mortgage. I didn't have anyone relying on me except me, so I was able to take the risk. If I had a family I don't know that I would have done it.

– May 10, 2012 12:46 PM
Q.

RE: Government worker

I sympathize with the government worker. But he/she does need to count their lucky stars, and it sounds like he/she is on the old retirement system. The new one is nothing like that. But reading other people's responses, can I just say please do not think this represents a large percentage of government workers. And, in every field, there is inefficiency, etc. like this. I am tired of government workers being a scapegoat for a much larger, complex problem.

A.
Michelle Singletary :

Amen. 

Productive and nonproductive workers in every field.

And frankly I thought the person who wrote was brave to talk about his or her situation. Clearly it bothers the person.

So thank you whomever you are for sharing.

 

– May 10, 2012 12:48 PM
Q.

Regarding graduation gifts

Our nephew is graduating this month, but has not invited us or sent an announcement. Over the past four years, he has ignored every overature for dinner and any communication we sent him. We are sending him a nice card for graduation.

A.
Michelle Singletary :

Based on your experience send the card. 

You've tried to have a relationship. That's all you can do.

But also recognize he's young. And sometimes young people don't that such actions can hurt them in the long run. 

Me, I would have loved to have had someone offer to take me to dinner when I was in college. Heck, I had to send money home to help with a disabled brother.

– May 10, 2012 12:50 PM
Q.

Big Mama

What do think motivated Big Mama to become the wise saver that she was? I imagine that her persistent saving (and future mentoring of you!) was not all that common among her peers ~ or maybe I'm wrong?
A.
Michelle Singletary :

My grandmother came from a family land owners, who remembered deeply what it was like to be slaves. Once they were freed they never wanted to be put in a slave-like position, which is why they hated debt. And they passed that on to my grandmother. Big Mama was also a big time worrier. She wanted to try and cover all bases or the chance she would get fired or laid off or that my grandfather's pay wouldn't make it pass his trips to the bars on payday.

But mostly she didnt' like owing anyone anything. So that helped motivate her to save and pay her bills on time.

It was her hatred of debt that she passed on to me and thus I pass on to you. I, too, don't want to be a slave.

– May 10, 2012 12:54 PM
Q.

Dissatisfaction with Wall Street

The sad thing is that main street is most dissatisfied with the top earners on Wall Street who are earning huge paychecks while the accounts they manage for the rest of us lose money. We are upset that the large account managers and management earn huge bonuses while our 401(k)s and IRAs hold steady with the annual loss eating up all of the new contributions that we put in out of paycheck. It's sad that the top guilty earners are a relatively small portion of Wall Street compared to the many who earn more pedestrian salaries and bonuses, but it's hard to shake the image. To improve the main street perspective on Wall Street, our earnings need to be better before anyone gets bonuses. I'm sorry that the rank and file of Wall Street gets thrown under the bus along with the big bucks, but that's life on the street.

A.
Erin Duffy :

I don't disagree with this, one thing I will add though, is that again, I think the media has run a little wild with the payment stories as well. I know of entire groups this year who received zero, and people last year who received zero and had their salaries reduced at the same time. Those weren't the stories the newspaper ran with, so a lot of people don't believe it's happening. You're right though, that's life on the Street

– May 10, 2012 12:54 PM
Q.

Mean-Spirited Responses to the Government Worker

That awful reply just burned me up. I get that your spouse would LOVE to work but so would this man! He stated that he has tried endlessly to get more assignments. I highly doubt that you would have your spouse leave a paying job that was boring. You really have a nasty attitude and a disproportionate sense that because you are struggling that everyone else should voluntarily force themselves into unemployment as well.
A.
Michelle Singletary :

Okay. Has everyone had a chance to vent?

Because folks its hard out there and I get both sides.

So we all good?

– May 10, 2012 12:55 PM
Q.

Erin

Earlier you wrote:, "Unfortunately like in every industry, a few bad people ruined the reputation for hundreds of thousands of others. " If it helps you understand middle America's outrage, these folks got $787 in TARP bailout money, and another $7.77 of cash infusions from the Fed. All the while paying themselves record bonuses, forcing folks out of their homes and cutting credit to small businesses that we needed to expand the recovery. I am waiting to see the first banking exec frog-marched to court for an arraignment for this behavior that ground the global economy to a halt.
A.
Erin Duffy :

Oh I understand it, I do! And for what it's worth, I have a few names I'd like to see top that list.

– May 10, 2012 12:56 PM
Q.

Re: What to do next?

For the poster who has done well financially but doesn't trust financial advisors, look for a financial advisor who is not tied to an end product like a mutual fund or stock broker. There are some financial advisors who do only that, advise you on your financial situation without trying to get you to purchase their end product. Pay a flat fee for financial advice, with no strings tied to it. Then you'll get someone whose goal is to actually review your financial situation and not to sell you their product or service. You really should have someone with good experience guide you in how best to plan for the future. You have the luxury of getting your ducks in a row before you need it. Take advantage of this so that you don't end up 20 years from now regretting that you didn't do any planning because you didn't know what to do.
A.
Michelle Singletary :

Good advice. Thanks.

– May 10, 2012 12:57 PM
Q.

Credit cards and College students

I know the importance of starting and maintaining a good credit history and have taught my 18 year old daughter about credit. I know there are new rules regarding the age a credit card can be issued, but my daughter has received two offers. I read the fine print and one looks promising. However, my daughter does not have a job where she receives a paycheck (she babysits) and I know if a credit card company checks her report it is considered a 'hard hit.' Do you have some advice as to how to start a credit card for her? Should we add her as an authorized user on our account and then remove her later, try a prepaid card - not sure that adds to her credit history, or something else? Any thoughts you have would be greatly appreciated. Thank you
A.
Michelle Singletary :

Let's see.

Your daugther doesn't have a steady job.

She's 18.

She does not need a credit card.

No, you don't need to add her to your card. 

Just get her a debit card.

In time, much, much later when she may need to borrow to get a house then she can start building credit starting with a regular credit card or a secured credit card if she can at first get a regular card. 

 

– May 10, 2012 1:02 PM
Q.

What We Can Learn

Erin, What can regular folks learn from your time on Wall Street. Can we trust financial advisers? It seems from your book, which I know is fiction, that most of the people were just focused on making money.
A.
Erin Duffy :

Well, the book doesn't deal with the Private Client side of the business. It dealt with Institutional Investors so it's a very different world. I think if you take the time to do some research on different Financial Advisers, their track records, how long they've been at a certain firm, how their fee structure works, and most importantly what kind of vibe you get from them personally, you can absolutely trust them. These people are well trained and well versed in how to handle the needs of different clients. They are an invaluable resource, but you should absolutey do some checking before you decide on one.

– May 10, 2012 1:02 PM
Q.

In Defense of Wall Street

Erin, I am so glad to hear you talk about all of the folks on Wall Street (the 99%, if you will) who go to work every day in a pressure-cooker atmosphere and work exceptionally hard so that the guys we see on the news can live their extravagant, 5-star lifestyles. My dad was one of those - he was a bond trader in a small brokerage house and while he made an exceptional living by most people's standards, he never made close to what those top-level decisionmakers made, even though he did the work that got them their supersize incomes. He paid every dime he ever owed in taxes, put two kids through school with no loans, and was one of the most scrupulously honest people I've ever known. Not everyone who works/worked on Wall Street is or ever was a crook -- and wanting to make enough money to take good care of your family is NOT greed - it's being a good husband and father and putting your family first.

A.
Erin Duffy :

I agree. And those are the guys who I know and love. It's an occupational hazard I guess of being in the business that you rise and fall as a group, but that was one of the most important points I was trying to get across in the book. That everyone is not equal, financially, morally, or otherwise. 

– May 10, 2012 1:05 PM
Q.

college costs

My son is graduating high school with a low GPA and high SAT scores. He has an anxiety disorder and ADD, which had made high school difficult for him. He got into a good state school, and wants to go. My husband and I would like him to work for a year (he was accepted to a highly regarded, structured gap year service program). We know that another year of brain development can only help in his case! My husband wants to leave the final decision to him, but I think we should have a frank conversation with our son about finances, such as what happens if he drops out, do we pay for 5 years tuition instead of 4, etc.  We have saved the money and are in good financial condition, but we still think we need to set some ground rules if he is expecting us to pay his way.

A.
Michelle Singletary :

I don't think you should leave the decision to go to school completely with your son. All of you should sit down and talk to him. See how he feels. I have a son with autism and I'm so worried about him handling college.

He's an honor student now in middle school, plays band and is a wonderful actor (he's in the school play right now playing Daddy Warbucks. His performance made me cry).

But his progress in everything has not been without a lot of work.

Maybe you take it one step at a time. Talk it out and if he thinks he can handle it, try letting him go for a semester. See how that goes. He may surprise you and himself. 

If he needs more maturing or time, he can take time off.

If you have the money, help him. Pay for college how and when it makes sense for him. That's what I'm going to do.

 

– May 10, 2012 1:11 PM
Q.

Bond Girl

What's the next book about? Can you say?
A.
Erin Duffy :

It's not a sequel. It's a whole new group of people in their 30s and it's taking place in Boston and Rhode Island. Fingers crossed!

– May 10, 2012 1:11 PM
Q.

Michelle Singletary :

Looked up and realized our time is up. Thanks so much to Erin. And thank you for your questions and comments.

Good chat. And it's because of you.

Til next time, stay financially safe.

Q.

 

A.
Host: