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Live Phroogally and live well

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Jason Vitug is CEO of Phroogal.
Jason Vitug is CEO of Phroogal. - (AARON HOUSTON)

I admit: I Phroogaled “What is the difference between stocks and bonds?” this morning.

Because I know absolutely nothing about financial planning or investing.

Zero. Nada. Zilch. Very much like my retirement account at the moment.

Frighteningly enough, I’m not alone.

According to this article, only 41 percent of women say they understand stocks and bonds, compared with 56 percent of men.

And only 25 percent of Generation X and Millennial women feel on track or ahead of schedule for financial and retirement planning,

I’d like to be a part of that 25 percent — before it’s too late.

I recently took a good, hard look at my life and realized I will no doubt be the breadwinner of a future family — as nearly half of the women in the U.S. are — and that if I don’t start investing now, I will have to work well into my 90s just to stay afloat.

As much as I love writing for NJBIZ, that sounds downright terrible.

So I reached out to CEO Jason Vitug at Phroogal — a website that allows folks to crowdsource financial knowledge within a Q&A database — for some needed advice.

Jason — an Elizabeth native who worked at Newark airport to help fund his Rutgers education — left his job as the vice president of marketing and business development for Tico Federal Credit Union in 2012 to travel abroad.

So it’s no surprise that this forward-thinker co-founded Phroogal upon his return, to provide the financial resources and tools necessary for success while connecting users with money-savvy peers and financial experts.

Sitting down with Jason was one of the best money-making decisions I’ve made, and here’s why:

He told me what I was doing right, and what more I could be doing to enjoy my lifestyle now while preparing for the future.

That’s right — at Phroogal, it’s all about the lifestyle.

The Phroogal Lifestyle, however, is not about fancy watches or glitzy mansions. It’s about enjoying time with family and friends, planning experiences rather than purchasing material items, and using available resources to live out your dreams.

But according to Forbes, only 14 percent of the women surveyed were confident they could meet that goal — meaning 86 percent (including myself) didn’t believe maintaining such a lifestyle throughout retirement would be possible given their current financial situation.

What Jason helped me to understand, however, was that it’s much more important to know how to use money effectively rather than try to figure out how much higher one’s salary needs to be.

RELATED: Closing the gender gap in financial education and planning

So in the spirit of Phroogal, here are some financial gems Jason chose to share with me, which I’m now sharing with you:

Understand your personal net worth by asking the following:

  • What are my assets? These can include checking, savings, investment and retirement accounts; insurance policies; business ownership interests; homes, cars, etc.
  • What are my credit card balances?
  • What will I owe in taxes?
  • Do I clearly understand the terms of my mortgage, car payments, student loans, and insurance plans?  

Your savings accounts should be physically separated into several categories, including, but not limited to:

  • Discretionary
  • Retirement
  • Short-term goal or transitions
  • Vacations
  • Taxes
  • 3 to 6 months of emergency expenses

Break down your monthly expenses into categories (fuel, car payments, health insurance, groceries, restaurants, events, rent, utilities, etc.) and create multiple savings accounts in which you only deposit the allotted budget. Then, make most if not all of your purchases with credit — and pay the bill off in full at the end of the month. Anything left over automatically goes into savings and investments.

Whatever the amount, be sure to invest 10 percent of each paycheck into a 401(k) and the maximum allotted amount per year into a Roth IRA. The money is there if you look for it. Got a tax return this year? Invest it — especially since investments made between the ages of 18 and 35 are ultimately worth more.

When you have enough saved to achieve your desired lifestyle indefinitely, that is the age you should retire. You don’t necessarily need to wait until you’re 65, and you don’t need to necessarily stop working at that age, either. Age ain’t nothing but a number in this game.

Lastly, get involved. Know exactly what you are spending and saving for. Stay up to date on your investments.

And don’t fall for it when your husband/boyfriend/son/roommate tells you women tend to spend more and are therefore more likely to be in debt.

Jason said one of the most common complaints he hears from couples in financial distress is that women make too many purchases.

But when Jason takes a harder look at their finances, however, he said he often needs to explain to a man that purchasing a single $1,000 flat-screen television is not the same as buying eight pairs of shoes at $100 each.

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Meg Fry

Meg Fry

Meg Fry covers manufacturing and retail. Meg joins NJBIZ with past production experience in the arts, film and television. She continues to write and market her own spec scripts and screenplays. You can contact her at megf@njbiz.com or @MegFry3 on Twitter.

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