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This past weekend a story broke out about how millennials are killing casual dining chains such as Buffalo Wild Wings and Applebee’s. This is apparently as a result of our evolved eating habits. We are the generation that’s removing the dust from our grandmother’s recipe books and getting more involved in the kitchen. Although the CEO’s of these big food-chains may not be pleased with us, one financial expert certainly is.
Meet Sheryl Rothert. A financial advisor who actually wrote a detailed book on the large financial impact having home cooked meals has had in her life. It may seem obvious if you’re already cooking from home. However, at the heart of the meal lies her insights on how the money saved can be invested to earn you millions come retirement.
You found a way to produce an extra $100 per month to contribute to your family's saving plan from managing your groceries. How did the idea even come up?
What happened was that we were working out a way to save more with my family. So we looked closely at our groceries since they are one aspect of the budget that is strictly under our control. Other costs like mortgage or rent etc. are more fixed. We decided to change how we were approaching our groceries so as to create meals that were inexpensive but also balanced.
The solution then was to find an interesting way to use our leftovers.
I started experimenting with new recipes and started discovering recipe’s that me and my family actually liked. I wanted to find recipes that freeze very well and would taste just as good if I had it for lunch at work the next day. One of our favorite is Chicken Chowder which you can pair up with a salad of your choice. I like this recipe because it is easy to freeze the leftovers and it tastes great heated up. It’s also a recipe that you can make from leftovers such as corn, rice, chicken kebabs, chicken stir fry, or chicken fajitas.
The secret of this recipe and other foods which work great for having second helpings is making it using a slow cooker.
What are some of the daily office snacks in your list that provide the best nutritional value but are also winners when it comes to cost?
Home made wholegrain muffins are probably my best. It’s not good to buy muffins, because from a health perspective, its equivalent to eating cake.
However whatever snack you choose make sure it’s something that you enjoy to eat otherwise you won’t stick to that diet.
What's been the biggest and best investment you've made towards both your health and your money?
Health-wise, my slow cooker has been everything. I actually got it as a wedding gift. With it I can cook my food throughout the day, by turning it on in the morning. It’s a great way to control my portions.
With regards to money, the best thing I have ever done is putting my savings into segregated funds, sometimes called GIFs – guaranteed investment funds. The great part about them is although they are based on the market, they are protected by insurance. The benefits of of these funds include:
- You can advantage of market growth potential while enjoying protection of your savings – a higher rate of return may be realized due to the protection and guarantees
- Keep gains – despite a market downturn; again, more potential for growth
- Provide beneficiaries a quick and confidential settlement at death, without the expenses of probate – another reason that value is higher
- And lastly you can enjoy protection against creditors : a very good benefit for business owners
However one must gather a proper understanding of segregated funds for themselves before investing in them. That goes with any investment.
Lastly, best advice on money that you can give to any millennial reading this today?
If you focus on saving money with your grocery spend, the bonus is your health. If you focus on improving your health, money saved will be the bonus.
And if you focus on saving time, by making a plan then both money and health improve at the same time.
The piece of advice then is to have a detailed life plan that considers your finances and your health and the marriage between the two.
A great example of the power of this is using Einstein’s rule of 72 to figure out how much you can make from saving at least $200 per month from your groceries or from curbing your expenses on eating out at restaurants.
The rule of 72 says if you divide 72 by the interest rate (at which your money will grow) then you will know the number of years it will take for your money to double. For instance, an interest rate of 8% will double every 9 years using this rule. Therefore, if you save that $200/mo at 8% you get close to $1.5 million over 50 years. The table below gives a more explicit preview of this.
Savings at 8% growth: $100/mo $200/mo $300/mo
20 yrs $56,900 $113,800 $170,700
30 yrs $140,850 $281,700 $422,560
40 yrs $322,100 $644,210 $966,320
50 yrs $713,420 $1,426,840 $2,140,250
60 yrs $1,558,230 $3,116,460 $4,674,690
However for this to be applicable it is important to find a good rate of return. Banks usually provide much lower returns than this. You can use the advantages of early investing calculator to find out more on interest rates.
Since millennials have time for their money to grow then a higher rate of return will be okay, doubling more often, giving them more growth for their investment.
As you approach retirement time, a lower rate of return is advisable to protect the growth.
Sheryl’s book, Found Health, Wealth, and Time in a Grocery Bag, can be found on Amazon