Color of Money Live (January 25)

Jan 25, 2018

Join Washington Post nationally syndicated personal finance columnist Michelle Singletary for an online discussion.

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Thanks so much for joining me today. It's just you and me. 

And as always, love those testimonies!

So let's get started. 

I should like to give one more solution to high food prices. Dollar General and Dollar stores stock a lot of foods that are much cheaper than in grocery stores. I shop then a lot and save a great deal of money. Perhaps you could mention that in one of your articles. I loved hearing about your grandmother and tried to follow her advice.


Read Michelle's column: Want to save more money? Try these three financial fasts

Been hearing a lot from folks about their overspending on food. 

And on occasion, I do get some food items from the dollar stores. But you have to scout them often since you never know what they will have for sure. You also have to be careful not to overspend on other stuff. There is always things I see and say, "Oh, that's nice, I could use another sponge, etc." Then blow my dollar store budget. 

We are all doing the best that we can to evaluate when to begin Soc Sec payments with the available information that we have now. We can make plans, but a sudden illness, or working longer, may alter the start date for these payments. Plans change. Do your best, and have no regrets over your decision.

Read Michelle's columns regarding Social Security: 

The great Social Security benefits debate: Take it early or wait?

Early or late: One senior says ignore the conventional wisdom of waiting to take Social Security. Take it at 62.

I can't recall a topic that has such staying power. See the links.

My husband and I are still debating. He says early. I say wait at least until full retirement age. 

But as you point out there are so many factors to consider. Honestly, once you review all the information make the best decision for yourself and then don't look back. No regrets because frankly none of us will know if we were right until the end.


I found the comments from the writer who was going to cut their giving because of the tax change interesting. This is another example of someone who puts the paying (or not paying of taxes) at the top of their priority list. And no one really knows what the effect of the tax change will be till they actually have a chance to run some numbers. My husband started a budget when he started graduate school in 1976. There has always been a section devoted to charitable giving. The budget is and always has been based on the net household income from wages only and we have never taken taxes into consideration. We give what we can afford and make adjustments annually based upon increase in salary and costs from the year before. Any tax return we get is a bonus that we save.


We give from our abundance. Tax break great but we would give even if there wasn't one.

But you know this money stuff is very personal. And people get very offended when you comment on how they view their finances. And while I certainly give my opinion, because well I'm paid to, I get that people have a right to give or not give as they see fit. 

I just like to challenge everyone. If you can afford to give, make it a priority and not an afterthought. Giving is first in our budget. And because it is, we spend less because we're working off 85%/90%. 

Michelle, in your newsletter this week, you asked readers how they're faring, after a year of Trump. For me, it's a strange split: our stock funds are booming, but in other ways, things are terrible (we just gave friends money to pay first month's rent after losing their house due to unemployment and family medical situations -- channeling your advice, we made it a gift and not a loan, since loans can destroy relationships if misused or not paid back). Yet at the same time, even if our stock funds are up, it all seems very bubble-y and unsustainable. Bottom line: my predominant feeling with Trump in charge is anxiety.

Read Michelle's newsletter this week here.

I love your balanced look. If you read the newsletter, you'll see a lot of folks feel the same way. Also, some experts say Trump is giving himself WAY more credit than he should for the stock market highs. 

My portfolio increased 2-3% per month over the last year while enduring a kick in the gut every day since the November, 2016 election. Is there enough money in the world to make torture enjoyable?

Investing is scary. In my case, my investments are up an average of 20%. But I know that can change. 

The torture is really concern that we'll have the savings we need to make ends meet now and in retirement.

Just do the best you can. Hate debt so that you don't take so much on. Keep your expenses in check and well hope for the best. That's all any of can really do. 


Loved your article about 1/6 millennials having savings of over $100,000. This is me and my spouse! It always rubs me the wrong way hearing how my generation is irresponsible when my husband and I work hard to manage our money carefully. Thank you for your article!!!

I like the survey too. It dispelled a lot of myths about young adults. Shoot my kid (22) has more money saved them a lot of  "adults" working with six-figure incomes. 

However, there is still a large percentage of millennials who aren't saving because well they are trying to live -- rent, student loans, car payments, etc. 

But they are no different than a lot of older folks. And you all know who you are. 

So get to saving. :)

What is the best amount of money to save if you are relocating to a new city

Hard to answer without more details. 

But here are some tips

-- Do a lot of research about housing costs. If you're renting see what the norm is in the area for security deposit, first month's rent, etc.

-- Be very, very, VERY careful about the moving company you select if you aren't moving your stuff yourself. There are a lot of scam companies out there. Take precautions. I've known folks who had their stuff held hostage when the moving company wanted to add on a lot of fees above the quoted price.

-- Think about shared housing until you can get a financial feel of the area. 

-- Talk to people living where you're moving. Ask about avg. cost of food, entertainment, etc. 

Hi Michelle, Last month, I helped my dad lease a car. When we were settling the financing at the dealership, they informed me that my credit score was 815. Awesome. Fast forward one month: My husband and I are house hunting and working with a lender to get a mortgage. They pull my credit score and it's only 716!!!! There have been no changes since last month. (The car lease is not in my name, so my credit report isn't impacted.) If anything, I've paid down my credit cards! The lender told me that the FICO score for mortgages can be different than for other consumer financing. But even he was surprised at the 716 score after looking at my credit history. Have you heard of this? I was shocked and really disappointed. I've worked hard to maintain good credit precisely because I want the best mortgage rates. What gives?!

Credit scoring can leave a lot of people scratching their head.

So it's possible that the lender pulling your score is using a credit scoring model that is very different than the model used but he car dealership. 

Have a good look in your file and make sure everything is correct. 

But honestly even with a 716 you're going to get a great rate. Find out what the credit scoring tiers of for the lender you are using. For example, when I refinanced last year the best tier was people with credit scores of 750 and above. But some lenders may say if you've got a score of 700 or 710 or 716 and above you're golden. 

Also, as you look to buy a home, shop around for lenders, always asking what do they consider the best credit score tier. 

Financially, our retirement accounts are booming, up 25-30%. However, I'd trade it all for some stability and safety for my friends and family who are suffering greatly under this administration.

Thanks for sharing this point!

And don't assume that the difference in cost of living is consistent across categories! When we moved out of DC, the cost of housing, gas, and restaurants/entertainment went down...but the cost of groceries went up. I can't figure this one out, but we definitely had to re-work our budget to reflect that fact that groceries cost more even though we're buying the same amount of the same products.

Good point. Thanks.

The thing that struck me about two of last week's commentators was that they phrased it "since we can't itemize". There's nothing saying that you _can't_ itemize. It may not be worth the trouble or financially beneficial to itemize, but you can. The standard deduction doesn't give you an out either, it's a simplification; it assumes you're doing the things you'd itemize for up to some average level. You can choose to not spend on deductible things to that level if you choose. But realize you're just gaming the system for your own financial benefit. Not that it is necessarily a bad thing, but people keep saying "can't" when it's just not true.

I see your point. But keep in mind, there are itemization thresholds you have to meet. So that may be what the poster meant. 

It wasn't clear in the article, but how was the Millennial savings number calculated? Is it just liquid & invested funds? Did 401Ks get included? Did home value? car value?

It included money in savings, IRA, 401ks and other investment accounts. Not home or car equity. 


If you're moving for a job, see if the HR department at the new place has some resources or if they can let you tap in to your new co-workers about where they live and what commutes are like. Check out the local public transit website for maps and fares. Local community colleges or universities might have info on housing costs. Good luck!

Also good tips. Thanks.

One tip is to switch roles of who normally goes to the grocery store. For example, I am the meal planner/shopper/cook in our house. I LOVE the grocery store! Let's say I had enough ingredients to make dinner if I just had milk, eggs, and a few fresh vegetables. Well if I step foot in the store I'll see other veggies and can't help myself! If I send in my husband with a list of just those 3 items, that's all he'll get. So assign the person who hates the grocery store to do it and they'll get in and out as soon as they can manage !

Love, love this idea.

Also, you hear this all the time but it's so true. Do not go to the grocery store when you are hungry. NEVER!

I totally overspend when my stomach is making noise.

I find the discussion of the tax benefits of giving dispiriting. I give for need--in the last couple of years some of my contributions budget has gone to such areas as supporting a cousin dying of cancer (I funded massages for her, meal delivery for the family) and buying college books and fees for another niece. You should give to causes you believe in, not for the tax benefit.

You are right. But I suspect many charities would take the money no matter the underlying reason. The need is so great.

If people want to give just because of the tax break, need still there. 

Also, just to be clear and I know you know this, the giving you describe for family wouldn't be deductible anyway. 

People seem not to understand that if they take the new standard deduction because it exceeds their itemized deductions, they won't be paying more tax than last year. So they have just as much money available for donations. And if they do still itemize, then they're still getting the deduction. There is no fiscal excuse for cutting back on your charity.


Read the chat from last week here.

Actually, whether folks will save with the higher deduction depends on their individual situation. Some folks will still pay more. Some less. 

Hi Michelle - could use your opinion about a credit score issue. I use the free Credit Sesame website, plus a credit card that offers the free service, to keep an eye on my credit score. I have a very good score according to the CS site, but it tells me I could improve my credit by having additional, more varied types of debt/loan accounts. It recognizes my credit cards, but does not show any record of my mortgage. I am a co-borrower on the mortgage (signed with my then-fiance who is now my spouse); the house deed was filed as a joint ownership type. I suspect the mortgage account shows up on my spouse's credit report but not mine. Should I be telling the credit agencies that my mortgage exists under my name too for accuracy's sake, or would you advise just leaving things alone since my credit score is otherwise good? Thanks!

I would definitely check to make sure the lender is reporting the mortgage under your name as well. Could be an oversight but I would want to get credit on my own credit report. You never know when your financial situation may change and you'll need those on-time payments to help your score.

Hi Michelle, Do you think the home warranty's (American Home Shield and Choice Home Warranty, etc) are worth the cost? Trying to save money and just wondering. I do use mine often.

I need to write a column on this.

So I'm personally all over the place on this.

I had a service and then cancelled because the fee for the visit was still $100+ and despite a reoccurring problem with my AC/heater the company wouldn't replace. Just kept wanting to do patches. AND I could never get a repair person within a week or 2. 

But I recently signed up again because at 14 years in current house stuff is breaking. Just had to fix a dryer, although I've had it for 14 years. But replaced washer two times (This after many, many days of research for the best most reliable washer). Anyway, trying again with Sears. Will give it a year and see what happens.  

Hi Michelle, I can’t make up my mind about whether to start a doctorate program. It’s a short version, about 4 years and $70k. I can do it while I’m still working full time. I don’t think we would have to take on debt to fund it - I don’t want to have any loans. We have retirement, emergency savings, own our home etc. The issue is that we also want to start a family soon and that $70k will likely be very needed in the next few years as our expenses increase. Do I do the program anyway?? I’m really excited about it. I’m doing reasonably well right now in my career but I think the doctorate will open career doors for me, hopefully resulting in additional income beyond $70k over my career. So I see it as an investment, but it’s not entirely *necessary*. How do you decide, financially, if something like another degree is worth it in the long run?

First, know for sure you won't have to take on debt. That's step one. Any debt, don't do it.

Second, talk to folks in the career path you want to go and see if the Phd really, truly made a difference. Some careers it's pretty much a must (Dean of a department at a university for example). But often I find people "think" the advanced degree is a must and it's not really. 

So talk to folks in the field. Also talk to managers and the hiring HR people. Ask how much it weighs in the decision for promotion. 

I toyed with the idea of a Phd too. But with three kids to put to college that $70,000+ was tuition, room and board for one. 

I recently pulled a credit report to check everything out. Everything seems to be in order, except a record that a volkswagon dealer pulled my credit 2 years ago in 2 separate locations. I wasn't car shopping 2 years ago, and the dealers are both out of state. When I had the option to flag something for review, these credit inquiries weren't eligible to flag in the report. Is there anything else I can do?

Definitely something funky there. Try calling the dealership to see if anyone there can check to see who or how your report was pulled. Could be the dealer paid to have a look at possible car buyers (although them being out of state still raises a flag for me).

If you don't get anywhere with the dealer, just keep checking your reports.

I'm so ashamed to not be in the number of millennials saving at all, outside of my 401k. Unfortunately, I made some horrible decisions after graduating college and while I thought I had learned my lesson... I didn't. I was such in a bind that I sought out a pay day loan because I blew my budget. I'm still in the process of paying it off. But I was thinking about taking a loan from my 401k to just pay off the pay day loan. Would this be smart or should I just continue throwing any extra money I have to pay off the pay day loan? I want to get to the point where I can save and not dip into savings when my budget is blown by either stupid indulgences or emergencies.

Please stop beating yourself up. But I do want you to learn from your mistakes. If you are local, come out to my financial class. (email me at for more details).

Or find some financial class. Or go to and make an appointment with a budget counselor, someone who can help you put in place some things to avoid any other pay day loan.

Finally, do not pull money out of your 401k. It's another loan. You are just trying one debt for another. Still got to pay it. And frankly, I want you to suffer a little so the lesson really sinks in. So yes, hustle, cut back to get that pay day loan paid off and quickly.

Also read the column about the 3 financial fast. I want you to try the 21 day financial fast, which will shut down all unnecessary for 21 days. It's amazing how that can help you see how much money you have to save if you stop the indulgences. 

My credit card company says my score it 811 (woot!). My bank says 765 (hey!!). It think it's a much an art as a science.

Yup. And 811 and 765 is pretty much the same. Once you hit a certain threshold you're in the best tier anyway. 


Good morning Michelle! I know that you've provided links in these chats before about a good guide to when to throw out old bills and financial papers (such as old taxes). I am in the midst of a project of cleaning out boxes of papers from my parents' home after they passed away several years ago. Is the general "you may throw out taxes after 7 years" rule also the same for those who are deceased? Would there be any reason why the IRS would want to look at papers of people who have passed away? I have a box of taxes of not only my parents' last return in 2011, but my grandmother's last return from 1992, and my great-aunt's last return from 1986. Can I throw out my parents' last property-tax bill on a house I sold in 2013? I will admit that my parents were Depression-era born, and had that classic behavior of not being able to throw things away, especially bills -- and I seem to have inherited some of this behavior too unfortunately. I trust you and your advice has never let me down: can I shred these? Or can you point me to a link about papers of deceased people? Also -- I have all of the Social Security cards of these deceased people, in a safe in my house. Do I shred these too? Thanks for helping me clean up! has a great article on when to shred financial documents.

But how about this. 

-- For family history sake, scan the very old tax documents and financial papers. I've actually had the occasion when I wanted to see what my grandmother paid in taxes, her income, etc. (I was writing a book). And I had a copy of junk mail my grandmother used to do her budget on. I just like seeing her handwriting. 

-- But if the estate is closed no need to keep a lot of the paperwork. 

-- Same thing with property taxes. Just scan the bill. 

-- I would definitely keep the old Social Security cards. You just never know when you might need to know what their numbers were and I like the idea of having the actual card. 

Hi Michele, I love your chats and wanted to get your gut check on my approach and next steps. I'm 35, single, and am debt-free after a long period of student loan repayment and a modest car loan. I've been saving for a house down payment but I like my current rental and I'm so discouraged by what's on the market that I've decided to not pursue that in the next few years unless my circumstances change. I'm a gov't employee and contribute the max to the TSP and have close to a six-month saving cushion and my house down payment in a money market account. I just opened a roth IRA and plan to hit that max every year. So what do I do with all the money in savings, including the down payment stash? Just let it sit there? Also, is my overall approach correct? Once I reach my goals for the saving cushion, where should I direct my savings? I think I'd like to do some non-retirement investing in index funds - does that make sense? I'd love your advice. My general approach is to keep it simple and not be too conservative. Thanks!

I think you have a great plan. Clearly you are a great saver.

Just FYI, if you think you'll use the house money in 5 years of less keep it liquid, don't invest that. 

As for extra savings, keep some in a life happens fund for the things in life that happen (major car repair) or to pay cash for the next car.

And should you purchase a home you could make a larger downpayment so that you can take maybe a 115-year mortgage. Or you can take a 30 if you want the breathing room and make extra principal payments. 


Or donate to the old-age fund for your favorite columnist (just kidding!)


If you also plan to have kids soon, the combo of full-time work, part-time school, and adding a baby can be really, really exhausting. You may want to do them sequentially rather than concurrently...

Oh, so agree!

Need a fast. The majority of my wardrobe and my child's are secondhand. I rarely go to the mall. But last month I realized I was still overspending at the thrift store on things I didn't need. So I'm trying my best to do a full fast - no clothes at all instead of just no new clothes.

Yup. I fussed at someone recently for overspending in the thrift store when she needed to be paying off some debt.

Her: "But I didn't spend that much on the xxx."

Me: "But you spend $200 last month on stuff at the thrift store that you didn't need."

She was looking at the per item expenditure instead of the total amount she spent. 

Consumer Reports is generally advises against extended warranties. However, many appliances today are loaded with very costly electronic components. Changing a mechanical timer that has failed in an older appliance was a rather easy DIY task with an inexpensive replacement part. Not so today. We have extended warranties on many of our appliances and and besides peace of mind, found them to be a good value.

Yup, that's why I got one too!!

In the store the electronic stuff on the frig looks so cool. Until it fails and the repair person tells you the cost to get it fixed. Blood pressure medicine time. 

Not to beat a dead horse, but one thing that we did when reaching the end of the year was evaluate the amount we were tithing and because we are blessed with the amount of liquid assets we have saved, we decided to pay our 2017 and 2018 tithing all in 2017, which I've read of other people doing. We did wrestle with the feeling of "am I giving for the right reason or for the tax benefit", and felt that our giving level was what mattered to us, whether it was 12/31 or 1/1 was just administrative. We figured we'll see how it works out and maybe stick to a larger amount every two years and alternate between standardized/itemized or go back to what we were doing before. Unlike SS, you can change your mind if you realize you should've done something differently. :)

Horse worth beating (although only no actual horse was harmed). 

Here's hoping that this article does a bit to dispel the idea that we all overspend on avocado toast while glued to smartphones, which is keeping us buying homes. Millennials came into a tough job market carrying heavy student loans, facing high costs of living, and coping with stagnant wages. The economy is changing fast, and so is job security with the gig economy, and most of us need or have a side hustle just to feel secure in an income.

Totally agree. 

someone who had misread someone's handwriting on a credit application. Once - oops the wrong name popped up. Twice - hey, is that really a seven? Let me check with the customer. Definitely call the dealership. This is something to elevate to the manager of the credit department from the beginning, but it doesn't sound really dangerous if that is the only weird thing you see on the report.


Chiming in about your article earlier about millennial savings. My husband and I graduated undergrad in the midst of the recession (both now 30). After undergrad and again after professional school, our parents both welcomed us back under their roofs in order to save. Since a young age, my mom's favorite motto has always been "choose to save." Coming to the U.S. as an immigrant with little wealth, my parents always reminded me (and now my husband) of needs vs. wants and the importance of contributing to 401Ks and Roth Iras whenever we could to realize benefits of compound interest. Thanks to their generosity of allowing us to live at home to save money and focus on our future, we've both been able to save over 100k (retirement, investing, savings accounts), put down 20% on our DC home, and focus on his student loans. We have friends that fit both sides of millennial money discussions (good savings vs avocado toast money wasting). A common thread we've found in latter cases is a lack of financial knowledge - both from growing up and lack of open discussions amongst friends (often a taboo topic). While we've been very lucky, I often point friends to a lot of resources available (this blog, reddit personal finance, etc.) for those wanting to get control over their financial future.

Thanks for sharing. Great points!

You just took a question about Credit Sesame. Is there any reason not to sign up for the free monitoring services like Credit Sesame, Credit Karma, and a couple others? They all want to sign you up for their "premium" service, but does taking the free service expose your information, hurt your credit or cause any other problems?

Do not sign up for a service. No need. The free score is a good way to keep an eye on your scores.

And go to to get free credit reports.

1) make a shopping list of what you need. 2) price that list out - web research, or from memory if these are regular items. Add a small amount of wiggle room for increases. 3) take only enough cash for #2, and no cards. Knowing that you can only afford the stuff on your list will help to overrule your stomach.

Good tip.

It's not that people WON'T give without the deduction, it's that the deduction might allow them to give some more. And there are a number of situations - for the wealthier - where it IS a matter of using the deduction to both give to a cause one would like to support, and maneuvering deductions to save some money. This usually involves more substantial sums of money. But there is generally "underlying giving" going on.

Fair enough.

Please remind your readers that just because you might not itemize on your federal return, you may still find it advantageous on your state return (especially California).


I've managed to cut my weekly food bill in half over the last two years, and these are some of my tricks: 1. stock up on staples like canned goods at a discount store, like Save-a-Lot or Aldi, 2. Look through the grocery store circulars and plan my weekly meals around what is on sale. 3. Make sure my weekly food plan has overlapping ingredients so food won't be wasted (for example, new potatoes can go into a soup one night, and the rest can be roasted with chicken another night), and 4. use my crock-pot as much as possible. I find I don't have a lot of discipline to cook in the evenings when I'm tired, so it's best to have dinner ready in advance.

Thanks for the tips.

Some of the options to maximize social security for spouses (such as file and suspend) are no longer available, making a sound decision much more important. But I agree, there are always the unknowns. My wife collected early at age 62 on her record (we are the same age). At age 65 I took spousal benefits on her record. At my age 70, I suspended the spousal benefits and took social security, with the 32% adder, on my record. My wife then took spousal benefits on my record. Her family has good longevity, my family somewhat less. Perhaps we should have deferred my wife's SS until her FHA, but we are not looking back, only ahead.

Make the decision and only look ahead. Good advice.

So I see a lot of questions I want to answer, in particular the couple living abroad. But I'm already over. So so sorry.

But I read all the questions and comments leftover. Some may make it into a column. Or please, please come back next week. Make a notation that I didn't get to you and I'll put you first in line. 

Thanks again for joining me today. 

See you back next week.

And if you don't subscribe to the newsletters please do. It's a great way to stay informed about personal finance hot topics. Link is right here on the chat page.

Also please do read and share my columns. Keep a sister employed :) Still have three kids to put through college. 

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Michelle Singletary
Michelle Singletary writes the nationally syndicated personal finance column, "The Color of Money," which appears in The Post on Wednesday and Sunday and is carried in more than 120 newspapers.

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