Gay personal finance and career advice
There are specific issues for Gay persons to have financial security.
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My qualifications to advise.
I don’t want to be a case of those who can’t do, teach. I also want to show that my recommendations have proven to be successful.
I never wanted to worry about money. I have ended up in a large house in a historic neighborhood with plenty of money and absolutely no financial worries. I have been going on 3-week international trips to East Asia once a year at nice hotels. I self-fund my research projects.
My biggest problem is to get used to having the money to spend on things.
Why am I advising?
I found most of the online advice on employment was selling training programs to corporations on having a non-discriminatory workplace.
There was no real advice for a Gay person to navigate the world of employment and work around discrimination.
For retirement for Gays, there isn’t anything.
What makes my advice GAY personal finance?
Most of my advice could be used by anyone and would work well for them. However, there are aspects of Gay life which make good personal finance very critical.
It is very unlikely that you will have children or grandchildren to financially assist you. Of course most children and grand children don’t financially help their parents or grand parents out, but for Gays who don’t have children, which is nearly most Gays, the probability is zero.
Often Gays don’t have any family to back them up. The alternative to homelessness is moving back with homophobic relatives.
Often Gays don’t have the family and relatives to assist in finding employment, lending emergency money. You might not work in the family business.
If you are homeless, you need to consider that many homeless shelters prioritize families first in allocating their facilities. Further a great many of them are operated by homophobic religions.
As a single man, you will less likely to be an object of sympathy and it might impact your access to help. Many charities will prioritize families. Many charities are operated by homophobic religions.
Many of the charities that assist the elderly are run by homophobic religions.
There are other minor financial adversities. When I got my HPV vaccination it wasn’t covered by my insurance since the CDC hadn’t yet indicated that it was recommended for Gay men. It was recommended some months later. Government agencies can be dilatory about the needs of Gay citizens. Gay needs can often be overlooked.
In terms of social welfare, Gay concerns can be overlooked. Only now is there starting to be LGBT housing for the elderly.
There can be prejudice in state offices to assist in employment.
There is discrimination in employment, and will be regardless of what laws that might be passed. Since you don’t have children there is an attitude sometimes you can be chosen to be laid off instead of the straight person with kids.
There can be discrimination in hiring, promotions, and layoffs. Anyone with experience working in a corporate environment knows that promotions and layoffs can be biased.
As a consequence, Gays really need to take personal finance seriously. You could end up in a really bad situation.
Further, if your Gay friend ended up in a bad situation, could you help them out financially?
Organization of this essay.
I am going to organize it somewhat by age groups going from starting life to retirement.
In school and the university and going back to school
It is in school that you can have a huge impact in determining your strategic place in the economy.
Having a strategic place in the economy can have a huge impact on your ability to not be impacted by discrimination. You have more possibilities in choosing jobs. You are much less likely to be impacted by discrimination in looking for a job or a new job. At the workplace you will be somewhat insulated from discrimination.
With a strategic place in the economy, you will earn more, and be able to have emergency reserves in case you are laid off, your chances of being homeless are greatly reduced, you can much more easily have money for retirement.
So the first thing is to get good grades in high school and the university. Good grades in high school determine which universities you can get into, good grades in college determine what your post graduate opportunities are. Also, desirable employers have more college applicants than they can interview. We used to just cut them off at a 3.0 grade point average.
Good grades get you into the college with better projects, better contacts with employers, better employers visiting the campus to do interviews.
Career choice is critical. I was reading an article in 1970 while in the 12th grade and finding out that persons having doctorates in chemistry were having trouble getting jobs. I went into chemical engineering instead. It wasn’t as appealing as chemistry to me then, but I wasn’t going to go to school to be unemployed and when there are unemployed people in your field, there are low wages.
When I was in college, I was a double major, chemical engineering and history. I was interested in ancient history. They thought I should choose a career in the history of science and technology since I understood science and technology and mathematics.
A history major graduates into a situation where he is usually one of 40 people applying for a single job. I was not interested.
As it turned out, I am the editor of two history books so far, and have chapters published in other books. So I didn’t give up history, I just knew it wouldn’t provide a good income.
It turns out that chemical engineering is a good preparation for semiconductor processing. I had a long career in a highly paying profession engaged in challenging problems in ramping up new technologies.
If you have an occupation in high demand, your strategic position versus the labor market and employers is very good versus where you are a dozen people competing for a job.
So in high school you need to plan your studies so that you have the background to get into a college of your choice and you can get into the program for the college major you want, for your future career. When in college choose a major that has a strategic position in the economy.
You don’t have to choose something you don’t like, but often you can find a career fitting some of your interests that also will pay.
My boyfriend in the 1980s graduated with a B.S. in Biology at the Univ. of California – Berkeley. The job prospects were largely not there. Mostly doing lab tech work at poor pay. He was thinking of going to get a graduate degree in zoology. I said that was a path to unemployment.
I suggested microbiology. There is a lot of commercial interest in microbiology. It is involved with pharmaceuticals manufacturing. It is involved in the creation of many foods. Fermentation is important to many industries. He went into it.
Turns out that microbiology was a good entry point to biotechnology: immunology, genetic engineering and other biotechnologies were getting started. He got good paid jobs and was even thinking of setting up and running a lab as the head of a start-up. Unfortunately he died of AIDS.
Just as I didn’t go into chemistry and went into chemical engineering and ended up in semiconductor processing, he shifted from biology and zoology, to microbiology which led into biotechnology.
Not everyone is going to be an engineer, scientist or mathematician. For each field you are interested you will need to be thinking strategically about your future. Any job that pays well, is also a job with challenges, and any job with challenges is a job that is interesting. You can learn to love your chosen profession.
Also, if you are going into a job market with challenging odds, think what you might do to break out from the crowd. If there are 40 applicants for the job, what makes you stand out.
Don’t listen to the colleges. They are promoting their major to keep their department filled up and also not to be cut. I was at a presentation of the different engineering majors at a major college in 1970. At that time a lot of aeronautical engineers were being laid off. So the head of the aero engineering college proudly announced that all the graduates had gotten jobs. My father however pointed out that one of their graduates was hired by his company, which was in a rural area making a product that had absolutely nothing to do with flying or airplanes.
Also, the need to earn a living is often dismissed. For example people will say, “Money isn’t everything,” but you should know that “Poverty isn’t anything.”
Also, if you can’t get a job in your field, you will likely find that your choices will not include jobs which are your heart’s desire.
Picking a good career doesn’t necessarily mean college. A lot of the trades pay well. Again, it is about getting a strategic skill or ability in the economy.
I am not saying no Gay persons should go into the arts or humanities, but if you do, you should have thought it through and have a plan to make sure you are financially secure. You need to be exceptionally talented. You may love the arts and humanities, but when you are 30, you might find yourself scrambling to get employment and be happy to have any job.
Where will you work with your education?
If your major is forestry, likely it is a rural job as well as a degree in agriculture. Look at where the jobs might be. The job in a rural area is likely a job in a homophobic area with limited contacts to other Gay people who are likely to be closeted. This is not to say that a job in a rural area is necessarily the wrong choice, it is about being fully aware of the choice you are making.
Gay ghetto occupations.
These occupations could be crowded and hence wages or salaries are depressed and you might have trouble finding employment.
Gay engineers were surprised to find out I wasn’t in quality control. It has become a stereotype that Gays are in quality control. Quality control has a useful role in manufacturing. However, doesn’t pay as well as process engineering. It has limited upward mobility and I don’t think you can become a principal engineer.
Savings
You need to sign up and save in the 401k or have some vehicle to save. In order to have money to put into the 401k or other plan, you need to be spending less than your after taxes income.
In terms of savings, you are up against a huge sophisticated psychological war to get you to spend your money.
If you aren’t able to pay the balance of your card off each month, in most cases that is a sign that you are spending too much.
Back in 1993 I did my boyfriends taxes. At that time I made 3 times as much as he did. For his taxes I actually had to fill out a Schedule B for those who earned above a certain amount in interest and dividends. He had saving. I didn’t have much savings. I realized I need to examine my spending habits.
I thought myself somewhat careful with my money, however, even though I was earning quite a lot, I didn’t have any significant savings. I realized that I need to change.
They talk about budgeting and all that, and if that works for you find. My parents used to have a ledger and budget, but I was always too busy.
What I did was four different strategies to have a surplus to save.
First, if the money was withdrawn from my paycheck automatically, I didn’t spend it. I had a plan that 50% of each raise went into my 401K or accelerated further paying down my mortgage.
Second, I thought about what I did spend and on what. A lot of stuff you buy is because subconsciously you think it makes you this or that or it represents this or that. You are sophisticated, or glamourous, or high class, or something. You are cool, or tough, or avant-garde or something. The reality is that you just end up having less money
Three, I had strategies to avoid giving into the urge of purchasing something. I adopted a rule if I really wanted something, I could purchase it three days later. What this meant is that I didn’t purchase it, and three days later the urge to purchase it had passed. Often something that you didn’t even know existed 15 minutes ago and you were perfectly happy without it, becomes something you intensely desire. Marketers know the weak points in your psychology.
Four, I only got a new car when the old one was going to die. What I would have paid in car payments I applied to house payments. It really shortens the time you are paying a mortgage. If you don’t have a house, you can be saving money to get your own place. I also got cars with good durability and maintenance and I got the cheaper car.
I avoid going to malls. There isn’t really much that is useful that you need to buy.
I don’t go to stores to browse.
I did grocery shopping with a list and cut my expenditures easily by 50% or more.
This doesn’t mean I was cheap or stingy. I did donate to charity since not wasting my money I had money to give. I was able to help individuals.
I don’t mind spending money when I get value for my payment. That is, it can be an expensive meal, or something really expensive, but it is worth the payment. I am not trying to purchase status, or be cool or glamourous, but it can be expensive when it has the value, I am paying for it. I purchase the thing, not the idea.
The fact is that often you spend money needlessly. Sometimes it might be big purchases, but it can be that your money is wasted in small driblets. You purchase the premium product with the gold foil or label that suggests it is a luxury product and you are something or another. The regular product would be just fine and you save a few dollars.
Example, I really only like beer during the hot August in Dallas. I was purchasing some beer and it had foil and was “premium” and I put it in the shopping cart. Then I realized I was wasting money, because subconsciously I was purchasing an identity. I got the regular beer and saved a few dollars.
Marketing is basically psychological warfare to get into your mind to part yourself from your money.
People who judge you on your car or designer clothes aren’t really people worth knowing. Usually, they have the car and clothes, but they don’t have savings. If you have money in the bank and have a house and no debt, you won’t need to impress anyone. You don’t want to be shabby, but don’t think that you need stuff to impress people with purchases. Impress people with the good things you do in life, or your accomplishments.
Gay people often think that expensive clothes will help them do better at the night club to meet people, or hot guys. It doesn’t work and you will attract persons looking for money from you or think you might be their sugar daddy.
The methods that I used to save money may not be the way you will save money. But if you aren’t saving money, than figure out why and figure out how you will save.
Without savings, a Gay person is leading a precarious life.
With savings you can weather a crisis. Layoff tend to be more frequent when the economy is down. So if you end up selling your house, it will be when the market isn’t so strong, when you get your job in the up cycle of business, the same amount of house will likely be more expensive.
With savings you can get your car repaired so you can get to work.
Credit Card debt is like having parasites.
The priority for anyone is to pay off credit cards. The interest rate on credit card debt is very high, maybe 36% or higher. The interest charged monthly on your balance would be 3%. That is after 34 months, you have paid in interest a little more than what the balance on your credit card is.
Once you pay off your credit card, you can first build reserves, and then you can look at accelerating mortgage payments, or increasing you 401k contribution, or put that money someplace.
Having credit card debt should be considered an emergency situation.
No store cards.
I am not interested in hearing excuses. No store cards. It is about spending money for consumer goods on credit. It is leading to temptation. It is about going into debt at high interest rate for something surely you can do without.
Thrift stores.
If you do like to shop, or you feel the urge, go to the thrift stores. The $150 shirt will be there for $5. You will find a wider range of goods and can save a lot of money. My significant other likes thrift stores. We have a house of what would normally be expensive furniture gotten for little.
Also, there are consumer goods, still in the wrapper. Shirts often have the original sales tag. People just purchase too much stuff.
Shopping in the thrift store is really an adventure since you see things from the past, and also different subcultures and different shopping venues. It really is more interesting than the malls. It is a good substitute for mall shopping also.
One time I survived a layoff. We went shopping to get out of the house. I got 8 nice shirts for $40 some dollars.
After you see what the item resells for, you will perceive the price they are charging for the new item at the store in a new. It helps recalibrate your perceptions of shopping. You will be instinctively be less amenable to paying the mall price.
Accumulating wealth
Savings and bonds are not good investments. You have to pay taxes on the interest, and you are having your wealth sapped by inflation. So you are paying taxes on the returns even though the bond are declining in value.
So if the inflation rate is 4%, the bond will just break even with a return of 5% or 6%, depending on your incremental income tax rate. If there is an inflation runaway, you will still pay taxes even as your value is being eroded.
The U.S. government debt is really high. I collected paper money back in the 1980 as a hobby. Mostly it was bills for currencies that became worthless. Usually, the origin was governments that were bankrupt.
When you are approaching retirement age the mutual fund companies will advise you to have more bonds and less stock. Ignore them. Bonds always have the risk of losing value due to inflation. They aren’t really safe.
Annuities are very conservatively structured and are a very poor investment.
Index mutual funds are good. They beat actively managed funds most of the time, especially over long terms. The cost of management is very low. You basically are investing in the long-term prospects of the American economy.
If there is a high rate of inflation, they will generally keep up with inflation, though there might be a delay in doing so. The goods and services they sell are going up with inflation so their profits will follow.
If the market crashes, likely prices will not be increasing and might be decreasing.
When looking at mutual funds you need to be aware of skewed sample bias. A lot of funds will have a record of impressive value increase over 5 or 10 years. But what is done, is that a lot of mutual funds are created. The ones that don’t perform well are shut down. So the ones that remain are those that did perform well. You aren’t necessarily looking at some type of management that has super powers, but just survivor selection bias. The 2% or 3% charges of an active fund add up over time and over time reduce your returns significantly.
You want to be putting in so much a month, rather than large lump sums, so you get dollar averaging, that is you are purchasing index funds when the market is high and low and your purchases are a market average.
Certainly don’t think you are going to outsmart the market. You are up against a lot of sophisticated investors with lots of advantages.
Own your home or residence. This is probably the most important thing to do for financial security. When you own your place, costs go up for taxes, and maintenance, but they don’t go up like rent. You start being financially ahead in a couple years. Further, after a while, you will own your house, which is real property.
When you pay off the mortgage, you will have a tremendous boost in financial security. If employment is interrupted, you just need to pay utilities to get through the month. There is no rent payment coming or mortgage payment coming. You only have to worry about the taxes and insurance which might be months away.
You absolutely need to find a way, if at all possible, to get a place you own. You need to take extreme measures. Even if the only house you can purchase, doesn’t have running water or working electricity or heat, buy it instead of paying rent. You can get water to drink, sponge bath and flush toilets and wash dishes. You can use LED lanterns. You can put up a tent in the living room. With the difference between what you were paying for rent and what you pay for the mortgage, taxes, and house insurance, you can get the water running and the electricity going in months. During that time you can be cleaning and repairing.
Rather than rent, get into whatever housing your can find, ugly or whatever.
Accelerate your mortgage pay-off.
Almost all of your mortgage payment in the beginning of your mortgage is going to interest and very little to principal. Any additional payment you make in the beginning will help shorten the time to payoff your mortgage by a lot.
I signed up for an every 2-week deduction form my paycheck to go to my mortgage with a service to do that. This service wasn’t the mortgage company. It was set up so with payments every two week, that was 26 payments total, and was making 13 monthly payments a year. Half your mortgage payment is always two weeks early. Doing that cuts down a 30-year mortgage to 17 years and some months. The advantage is that it is synchronized with your paycheck, and the money isn’t in your hands to spend. The downside is that they are getting some use out of your money, before it goes to the mortgage. However, you are relieved of a lot of managing, and it is an easy system.
However, you do it, pay extra on your mortgage.
Job searching and career planning.
The employment in the United States for semiconductor engineers declined about 70% in the last 12 years of my employment before I retired. I kept getting new jobs as places closed. Being expert in career planning and looking for a job is critical. Somethings I learned after the fact, sometimes before.
I acquired a reputation for being able to find jobs and people called for advice.
One of my former bosses, said over and over again in amazed belief, “You actually retired in the profession!” Most of my co-workers ended in in new fields which didn’t pay as much.
Every job is preparation for your next job. Realize that you need to consider to have employment in the future and not brought down by hazards.
Looking for work when you are employed is always much easier than when you are unemployed.
After 2008 a lot of companies adopted a policy that they would not hire anyone who was laid off. I hope they are all bankrupt now.
Live in an urban area. There are more jobs since there are more people there.
To avoid layoffs, always keep track of your employer’s situation. Start looking if your situation looks insecure. Loyalty to your employer counts for nothing now days.
I have a written up a guide to looking for work, but it probably is dated to some extent, and is long. So I am going to restrict myself to key points.
[1] Read current books on interviewing and job searching. It changes over time. There is a lot to successful job interviewing and reading the book will take some time. Your resume will be much better.
[2] Look at your resume from the point of view of your future employer. When this person reads your resume, does it communicate how you will make him successful?
[3] Keep track of job resources. Way back in the day I had a file full of job adds from other employers in the Dallas area. Later I had links to all the online job boards. I collected business cards. Each profession is different. Do you have a list of contacts to send resumes to? I used to have an actual box labeled Job Search box. Later I had a file on my computer with job search materials.
[4] Never take a break between being laid off and looking for work. Over the years, time and time again, people take a break for a day, and then ended up not starting to look for work a month or so later.
[5] Looking for work is a total effort. I used to say it was total warfare against being unemployed. You easily might be searching 40 hours a week. You need to me constantly doing something to find work and strategizing on how to find a job. I kept a log book of my efforts. Track your job searching efforts. Make sure you do at least one thing a day, and log it.
[6] Start preparing for a job search when you first hear a rumor of a layoff. Get the resume updated. Update your online job sites. See how job searching is currently done. Make sure you are in the right linked in groups. The thing is these items add up in time and if you start when laid off, it might take several days to get it all done. Further, you will have some type of psychological momentum going and will be much more positive in attitude if you are laid off. All your information will be updated, instead of you having to do it later.
[7] No one can give you a job, if they don’t know you exist. If you are looking for work and are unemployed have a business card that you give to everyone. Email everyone you know your resume. You never know who knows somebody.
If you get depressed, do walking or exercise. Force yourself to eat something at each meal. Have someone give you a massage.
Don’t be alone.
If you have someone to live with, you both have a financial advantage. The old saying, “Two can live as cheaply as one,” applies to Gay couples. You split the rent or the mortgage payment, as well as the utilities for heating and air-conditioning, streaming services, internet. Your expenses won’t be reduced to half, but they will be much less.
If one person’s car breaks down, the other can drive him to work until the car is fixed. You can be backups for each other in many situations.
If one of you is laid off, the other can be paying the bills until you get on your feet again. Also, when I was laid off after working 20 years at a company, who do you think gave me that massage.
This is not to preclude throuples and other group situations. We tend to group ourselves as straight people group themselves. There might be other ways Gays could be associated. A closely knit group of five would likely be able to weather many economic hardships and when they get older, most of them will pass away while still not being alone, except the last one.
Roommates are a way to cut costs. I haven’t thought of what might make this more feasible. Separately I am writing about how Gay housing might exist which involves group arrangements.
Summary
There will always be some prejudice against Gays, and their will be specific disadvantages Gays will face. A counter strategy is needed. The first strategy is to realize that you need a counter strategy and realize that you have a specific situation as a Gay person.
I agree, saving looks cool. Thanks for sharing these useful tips and mentality.