I recently chatted with one of my favorite financial experts, Jean Chatzky, who shared her thoughts on paper-and-pencil budgets, planning for retirement and staying out of debt.
If you channel-surf while getting ready for work in the morning, you've probably noticed Chatzky on NBC's Today Show, where she doles out financial advice for the average family.
Not a morning person? Don't worry: night owls can catch her new show, Cash Call with Jean Chatzky, on Tuesdays at 8 pm on RLTV. Chatzky will field live phone calls from viewers during her show.
Q: You've been dispensing personal finance advice through the good times and the bad. What changes have you seen over the decades in the general public's interest in personal finance?
We're always more interested when markets are going up. (Laughs).
Our interest in personal finance has gone up because our responsibilities have gone up. 401k (retirement savings accounts) were invented about 20 years ago ... with that, people have had to become more responsible for their own retirement. I think we understand we've got more to deal with, and we have to take care of ourselves.
Q: You're about to debut Cash Call on RLTV, and I understand that this TV channel is geared towards viewers who are 50+. What sparked your interest in reaching out to this audience?
I'm 47 years old, and I feel like this is an audience I am a part of, and my mother is a part of, and my friends are a part of.
Q: The 50+ audience has serious financial concerns: They've experienced huge slumps in their real estate and stock portfolios and they're at a point in life in which they want to start reducing their risk exposure. What's the best way for the average 50- or 60-year-old American to continue to grow wealth, while keeping their risk exposure moderate?
I think all of us ... need to remember how long term the long-term really is. People in their 80's still need to have some exposure to the stock market.
That continues to be true as our lifespans continue to grow. We've got an awful lot of life left when we're 50 or 60, and we need to invest in a way that's conscious of that.
Q: Standard financial advice says you should start saving for retirement when you're in your early twenties. What if you didn't? What if you're 40 or 50, and you're saying, "Oops!" Now what?
There's a big population dealing with student debt right now, a big population of people in their twenties who don't feel like they can save.
Of course it's better if you can start when you're younger, but if you start when you're older, you have to be more aggressive about saving. You can choose to live a little less large in your 40's and 50's so you can put more away.
Although the markets are, to a large degree, not within our control, there are other things that we can control. We need to focus on controlling the things we can, like how much we're saving.
Q: Some retirees are now practicing "geographic arbitrage" - the act of moving to a place with a lower cost of living in order to stretch their dollars. It could be domestic, like moving from New York to Nebraska, or it could be international, like retiring in Panama. What do you think of this?
It's really nothing new. I remember writing articles about this for Forbes (in the early 1990's). This has been going on for a long time.
I like people to not have a mortgage in retirement. If you can comfortably do that by moving someplace that you think is fun and exciting, then do it.
But if you've worked hard in New York for years and now you want to enjoy the city that you've worked so hard in, I think you can do that, too. There are ways to reduce costs, no matter where you live.
(Read more: Learn how to take a budget vacation to Manhattan.)
Q: Now for the million-dollar question: Do you believe in budgeting?
There are many ways to do it. Some people practice budgeting in their heads. Some people practice budgeting by paying attention to the balance in their bank accounts.
I don't want to tell people they absolutely must have a paper-and-pencil budget. At the end of the day, people need to spend less than they earn. No matter which bucket the rest of your money falls into, you're not going to fail.
Want to ask Jean Chatzky a question? Call her show at 1-855-550-RLTV (7588). She'll field live phone calls on Tuesdays at 8 pm on RLTV.