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AARP Article

Looking for a Job? Why You Need to Go Social

Your profile is your calling card to the new generation of recruiters

When you apply for a job today, here’s what the recruiter is likely to do to get a more rounded view of your accomplishments: Check your profile on LinkedIn. Browse your Facebook page. Look for a blog or a website. And see if you’re tweeting, which shows that you at least know what it is.

If you look competent online, you might get a response to the résumé that you emailed to the company. If you have no digital footprint, you’re likely to get a pass. The only exceptions might be jobs at very small companies or nonprofits, or lower-level jobs, for which résumés are enough.

All this might come as a shock to job seekers over age 50, who have been happy to leave tweeting to the birds. But employers today need people who are comfortable online, and digital recruiting is the way to find them.

I recently recommended an editor who was over age 60 for a job, and the first question I got from the recruiter was, “Is she good at social?” — meaning social media. A job seeker over age 55 told me that even temp agencies want you to have a website as part of your job portfolio. “Seasoned, mature workers look young online, if they show they can communicate in the digital world,” says James John, chief operating officer of Beyond.com, a job search site.

Get Social!

1. Make yourself visible

If you’re just browsing company job boards — boomers’ favorite sources of job openings — and sending résumés online, you’re not doing enough: Employers need proof that you’re up-to-date. Even if you network the old-fashioned way, by calling friends and having lunches, the employment decision will probably be funneled through the hiring office, which will search for you online.

So before you even begin a job search, you should set up a digital profile or improve the profile you have. It’s your calling card to the new generation of recruiters.

Begin with LinkedIn. Last year, AARP launched a program on LinkedIn — now called Life Reimagined for Work — that brings together workers, employers and career management experts. On LinkedIn, there’s a profile page where you present yourself — showing your employment history, skills, certifications, honors, volunteer work and anything else you’d like a recruiter to know. Don’t hesitate to brag — your competition does. Post an appropriate head shot. Recruiters won’t look at profiles without one.

Then search for friends and business colleagues on LinkedIn. If they have profiles, send a request to connect with them online, and ask key people to post a written recommendation on your page. See if the companies you’d like to work for have LinkedIn pages. You’ll find job postings there, as well as company news.

“Some companies don’t even ask for an emailed résumé anymore,” one young job seeker told me. “When you’re on their job site, they ask you to apply by clicking a LinkedIn button and uploading your profile.” Don’t even think of faxing. That’s so yesterday, and a sign that you’re out-of-date. Snail mail just wastes a stamp.

2. ‘Friend’ someone (lots of someones)

Use Facebook to set up a free profile page. Again, search for friends and business colleagues and send them a “friend” request to link to their pages. You can ask them about the job market or about the companies where they work. This is another place to inform your community about the work you’re doing, such as consulting, writing or developing a part-time business. Companies have Facebook pages, too.

To step up your game, consider a personal website under your own name — for example, JaneDoe.com. You want the site to come up if a recruiter searches for you specifically.

A website is the place to demonstrate professional expertise. You can expand on your accomplishments and link to any work that already appears online, such as papers, articles or professional awards. (Enter your name into an online search engine to see what shows up.) Keep up with the news in your field and post commentaries — that section of your site is called a blog. Every couple of days, write something on the subject, under a headline that will attract attention.

(As an example of how this can work, take Mitchell Hirsch of Wilton, Conn. When he was out of work, he blogged regularly on unemployment data and issues. His posts were discovered and he was asked to add commentary to other websites. “At first, I was writing for $25 a post,” Hirsch says. “But I told my wife that something would come of this, and it did.” Today, he advocates for the unemployed at the National Employment Law Project in Washington.)

3. Learn the joys of tweeting

Then there’s Twitter — the place where you summarize the world in no more than 140 characters. Each post is called a tweet, and it’s delivered as a text message. You can follow the tweets not only of colleagues who might be on Twitter, but also of recruiters or important people in your field. You also can follow companies that tweet job openings. Twitter doesn’t carry the heft of LinkedIn, but it shows employers that you’re keeping up with the digital world.

Once you’ve set up your digital presence, you have to feed the beast with regular posts, comments and links to interesting developments, which is a job in itself. But the modern job hunter can’t avoid it.

“The online world is the new talent pool,” says Dan Schawbel, founder of Millennial Branding. “If you aren’t in that pool, because you don’t have profiles on the networks, then you won’t be found and aren’t as employable.”

If all this sounds daunting — and it flummoxed me when I first set up my profiles — you can find plenty of advice online. Search the Web for answers to your practical questions; buy a book about websites; ask your children and grandchildren for help; or, for help with everything from the most basic Web skills to how to use online organizing tools, hire a computer tutor or attend a continuing education class.

4. Start drilling down

Once you’ve established — or enhanced — your presence online, you’re ready to drill down on jobs. Big companies and many smaller ones have “Careers” pages online. Job boards such as Monster.com, Craigslist.com and CareerBuilder.com list thousands of jobs.

Beyond.com will build a profile from your résumé that can go to any employer who checks you out. There are job boards for particular professions, such as JournalismJobs.com and newspaper want ads.

As in the old days, you still need a cover letter, tailored for the job you’re seeking. Tip: Use the same keywords that the company put in its job posting. It will help the computer find you.

Once you get in the door for an interview, you can sell your experience, contacts and successes. The interviewer will have read your profiles, so he or she already thinks you might be a fit.

“Employers are always going to question the energy and relevancy of older workers,” says Wayne Breitbarth, a social media trainer and author of The Power Formula for LinkedIn Success. “An online ID shows that you’ve already changed with the times.”

(Originally published in The AARP Monthly Bulletin.)

AARP Article

It’s Time to ‘Power Save’ for Your Retirement

Can you really count on working until you’re 70 — or older?

There’s a myth going around that I’d like to swat down. It’s supported by working people — maybe even you — who aren’t saving enough money to live comfortably when their paychecks stop. The myth says you’ll be OK, even if you don’t increase your 401(k) contributions or other savings. You’ll make up for your small nest egg by working longer. The usual phrase is, “I’ll work till I drop.”

Many retirement experts tell the same tale. If everyone works and saves until 70, most of the retirement income problem does go away.

That’s a big “if.” In 2011, only 32.3 percent of men and 18.7 percent of women age 70 or older were still employed in some capacity, the Bureau of Labor Statistics reports.

“It’s terrible public policy to advise people that they can plan on solving their financial problems by working longer,” says Jack VanDerhei, research director of the Employee Benefit Research Institute (EBRI). “You should take control of your retirement now, while you have the chance.” That means reducing expenses and pouring everything you can into savings during the time you have left to work.

You might be able to stay employed until 70 if you’re healthy, lucky, well-off, work for a company that keeps older employees, or run a business of your own. But the more familiar story is that of older workers forced out of jobs they’d hoped to keep.

Half of the people retired today say they left work early and unexpectedly, most because of health problems, disability or changes such as downsizing, according to an EBRI survey. Those aren’t great odds, if you’re counting on working to pay the bills.

You can “power save”

The good news is that you can add a surprising amount to your nest egg in just a few years if you squeeze your spending and make saving money your priority.

Say, for example, you’re 50, earning $70,000. You’ve saved $100,000 in a 401(k) and are contributing 7 percent of your pay — $4,900 a year. If you make no change, and have to leave your job after five years, you’ll have $169,000. But if you double your contribution, you’ll have almost $200,000 — a much more comfortable cushion. If you double your contribution and work for 10 more years, you’ll have $336,700. That could be $531,000 if you make it to 65.

(To estimate the gains, I took the past 10-year returns of Vanguard’s U.S. Balanced Index Fund, which holds 60 percent in stocks and 40 percent in bonds — the classic investment mix. The stock and bond portions each follow a major market index. Over the decade ending last November, that portfolio earned almost 7 percent a year, after fees.)

At retirement, a bigger nest egg is just the start of the saver’s advantage. Even though you’ll be using the money to help pay your bills, the savings that remain in your 401(k) or individual retirement account will keep on making long-term gains. “Roughly half of your total lifetime investment return comes from earnings on your savings after you retire and start withdrawing money,” says Don Ezra, a retirement wealth consultant and co-chair of Global Consulting, Russell Investments.

What if your nest egg is invested more conservatively and doesn’t earn an average of 7 percent over 10 years? “In a low-rate-of-return environment, higher contributions to savings make an even more striking difference” to your retirement finances, VanDerhei says.

EBRI estimates that about half of all boomers will have more than enough income and savings for an adequate retirement. Those falling behind tend to have modest incomes, with single women in more trouble than couples or single men. People without access to a 401(k) or other automatic savings account also are falling behind.

By the way, you were probably surprised to learn that a balanced stock/bond portfolio earned nearly 7 percent over the past 10 years. At the moment, we tend to remember crashing stocks, low interest rates and sluggish growth. But the past decade proves the value of the tried-and-true investment formula: Buy, diversify with mutual funds, hold, reinvest dividends and rebalance to maintain your target allocation of stocks and bonds.

“Power saving” now is the way to go. If you lack money at retirement, you’ll have to lower your spending anyway, and by much more.

Consult your financial adviser regarding your personal situation.

(Originally published in The AARP Monthly Bulletin.)

AARP Article

Can You Really Trust a Financial Adviser?

Here’s what to look for — and what to avoid

It’s the hardest question to answer in personal finance: Who can you trust (or, as my mother would insist, whom can you trust)? There’s a world of self-serving advisers out there, laser-focused on getting a piece of your retirement savings.

I’d say, “Trust no one,” but that’s not practical when you’re trying to manage money to last for life.

The better approach is to understand where your adviser’s self-interest lies and ask yourself whether you can work around it. Surprisingly, the biggest hurdle you might have to overcome is your own polite tendency not to contradict what your adviser says. You might even agree to invest in something you suspect is not altogether good. Yet, as studies consistently show, many advisers often will give poor advice in order to earn more for themselves.

For a great example of both of these propositions, take a look at a recent experiment done by Sunita Sah, assistant professor of business ethics at Georgetown University in Washington, D.C.

She set up two lottery choices, one with much better prizes than the other, and divided groups of volunteers into “advisers” and “advisees” (think of the advisees as “clients”). Some advisers were promised a reward if they recommended the poorer choice and the clients followed their advice. Over three-quarters of these advisers did exactly that.

What especially fascinated me about Sah’s study is that half of the clients decided to follow the poor advice, despite the fact that it was obviously bad. When the adviser’s conflict of interest was specifically disclosed to them in advance, the clients were even more inclined to go along. More than 80 percent of them chose the poorer option, while also reporting that they thought the other choice was more attractive.

Why does this happen? Sah calls it the panhandler effect. Some combination of social pressure, desire to cooperate and awareness that the adviser is asking for a favor (the “panhandle”) can lead us to make a decision that’s against our own financial interests. Clear disclosure of the conflict of interest — supposedly a boon to consumers — actually works against us, emotionally. We don’t want advisers to think we’re mistrustful, so we agree, sometimes reluctantly, to what they want.

The lesson from Sah is that you’re vulnerable in ways that you hadn’t known. Your best defense is to stay away from the kinds of advisers most likely to lead you wrong.

First on my list of risky choices would be people presenting themselves as some sort of “senior specialist.” There are more than 50 different “senior” designations — impressive initials strung after the adviser’s name. They purport to show that the adviser is “chartered,” or “certified,” or “accredited” for seniors due to some special course of study. Mostly, the designations are merely marketing tools that the advisers paid for, with little or no serious study. For actual expertise, look for a CFP (certified financial planner) or RIA (registered investment adviser). For more on senior designations, check the report by the Consumer Financial Protection Board.

Next, stay away from free lunches for seniors, even if you think you’re strong enough to go only for the food. These lunches are purely sales pitches for expensive products, not genuine advice. You can’t even count on getting truthful information.

Third comes the difficult question of financial salespeople at banks, brokerages and financial planning firms who earn commissions. They’re the most common source of advice for people with average earnings and savings. You know that you’re paying for the financial products you buy, which is fine if the advice is good. But is it really, or are you always buying the costliest products in the shop?

To protect themselves, consumers are typically told to ask what the salesperson earns on the product or its total cost. But as Sah’s study shows, disclosure could make you even more vulnerable to a pitch for high-commission investments such as variable annuities and the firm’s own, branded mutual funds. So instead, test your adviser by the products he or she suggests. You want good diversification, lower-cost index mutual funds that follow the market as a whole and a philosophy of buy-and-hold, not buy-and-switch.

The simplest form of protection is to work with advisers who charge only fees, not sales commissions. To find someone local, try the Financial Planning Association (check the fee-only box), Garrett Planning Network (geared toward the average saver) and the National Association of Personal Financial Advisors (generally, for the more affluent). Fee-only is no guarantee of good advice, but it’s much less likely to be bad. That’s a comfort in itself.

(Originally published in The AARP Monthly Bulletin.)