Showing posts with label Saving. Show all posts
Showing posts with label Saving. Show all posts

Tuesday, March 19, 2013

Conscious, Deliberate Decisions.

58)  Conscious, Deliberate Decisions. 




D
ecision-making is a process.  It's a rewarding one whether it's for goal attainment, smart decisions, your American Dream, quality of life, fame & fortune, simplicity, or a mental exercise - and exercise feels good.

            You assess a situation, you consider your alternatives and their repurcussions, and then make a conscious, deliberate decision.  Maybe you temper your mind with your heart, your gut, your moral compass, but you make a prudent choice using a smart process.

            Where will you live?  By the sea?  (I hate being land-locked but wouldn't want to lose my home or my life to a  hurricane.)  A city?  (More than half the world's population now does.)

            What will you do for food clothing and shelter?  Will you hunt?  Farm?  Sew hides?  Weave?  Live in a cave?  Build a log cabin?  Do you need money for these things?  If so, how much?  How will you get money?  Steal, work, public assistance, beg?

            Will you have children?  With whom?  How will you raise them?  Alone?  How about their clothing, a home, healthcare, and education?

            What about your health?  How might you pay doctors or buy medicine?  What if you can't work?

            How about old age?  Will you work til you die?  Who will take care of you if you're sickly?  Where will you get money?  Who will bury you?

            How will you get and manage money?  How much do you need?

            In life, you can choose your own path, otherwise it will be chosen for you.  You can live life on purpose or by accident.  You can be captain of your ship or a victim.  No decision, is a decision.

            It's up to you.

How do you make conscious, deliberate decisions?

            Who helps you make smart money decisions?

Who's your Trusted Family Advisor?
            

Tuesday, January 22, 2013

'The Trusted Family Advisor’

55) The Trusted Family Advisor




H
ow does one, especially a woman, choose the right Financial Planner?

            Firstly, what is financial planning?

            Financial Planning is the effective management of financial resources to achieve life goals.

            What is a Financial Planner?

            A professional in a vocation involving specialized knowledge & skills used to provide disinterested counsel and service for compensation without expectation of other business gain.

            A Financial Planner may be trained in a variety of personal finance topics ranging from daily financial management to long-term financial planning.  These topics can include goal-setting & prioritizing, values assessments, budgeting (what you spend on), cash flow management (when you spend), banking & bill-paying, credit management, and tax management, to insurance management, home purchasing, education planning, retirement planning, investing, estate planning, and specialty areas, such as planning for same-sex couples or divorce.

            The CFP (Certified Financial Planner) is often the professional designation of choice.  It covers a wider range of topics than any other financial professional, with the possible exceptions of the Chartered Financial Consultant (ChFC) or a CPA who holds the AICPA's Personal Financial Specialist (PFS) designation.  There are other designations out there, but they are usually related to a single specialized area.

            A Certified Financial Planner holds a certificate from the Certified Financial Planner Board of Standards.  To attain this designation, the professional must satisfy education & ethics requirements, have passed a long, comprehensive competency exam in a variety of topics and have had three years of experience.  They are then governed by a Code of Ethics, a Code of Practice Standards, and a Code of Professional Conduct.

            A disclosed CFP Practitioner practices the 6-Step Financial Planning Process:

            1. Establishing and defining the client-planner relationship.

            2. Gathering client data, including goals.

            3. Analyzing and evaluating your financial status.

            4. Developing and presenting financial planning recommendations and/or alternatives.

            5. Implementing the financial planning recommendations.

            6. Monitoring the financial planning recommendations.

            All of this is separate and above from licenses and registrations for managing/brokering investments and/or insurance, preparing taxes, practicing law, etc. and other specialized designations such as for divorce financial planning.

            A CFP Practitioner (vs. a CFP) will be one of the best persons you will ever know since they are usually intelligent, articulate, educated, practiced at teaching, and they like to help people, and adhere to high personal moral integrity.  They are not all about making money for themselves, although they like to earn a decent living and be in control of their own lives.

            The biggest issues that women face relate to their historic non-involvement with money.

            If you think about this, it’s ludicrous.

            Women live longer than men, often marry someone older, and already control more than have of the money in the US.

            They have always had to provide for children (and now, parents), and have always managed the household, making them excellent multitaskers, budgeters, and savers.

            But it's been the man's purview to have a team of financial professionals, including accountants, attorneys, bankers, insurance agents, and investment brokers.

            Men like to confidently take action, often ignorantly and without advice, and they often practice, 'Ready FIRE, Aim'.

            Most financial professionals are men and most financial decision-makers have been men.  If a man and a woman visit their advisor together, studies show that the professional spends the majority of the time speaking to the man.  The man will 'take care of the little lady who should concern herself with such things’.  This just pisses women off and they usually find a new advisor when their man is no longer in the picture.

            Therefore, a woman will want to choose a planner who is referred and/or whom she has checked out by hearing them speak (e.g. live, TV, radio, writing).  She will check their credentials.  She will meet with him/her to feel comfortable and heard.  The planner should be professional, willing to explain things again, and again, until she feels comfortable with the answers to her questions and the advice.  The planner needs to be patient, understanding and have a good bedside manner.  A woman will develop trust for the planner and be involved.  And the planner will be responsive.

            In my office, we appreciate delegation, not abdication; we fire clients who abdicate responsibility and involvement.  And we place particular emphasis on education and security.

            We like to teach, women like to learn.  Women have different goals and values than men.  Women like to make a plan, and patiently stick to it.  Women integrate, men categorize; women ask for help.  Women are loyal and send referrals.

            In her book 'Next: Trends for the Near Future', Marion Salzman, a Young & Rubicam Global Brands Manager observed that people are spending more and more time with like-minded individuals.  This ranged from who their friends were, the activities in which they participated, with whom they do business, and even where they live, moving to be closer to those who share their values and interests.

            The right planner may be more loyal, communicative, respectful, and true, than a husband.

            Who's your Trusted Family Advisor?


Sunday, November 11, 2012

'And the Winner Is...'

46) Nor 'Easters in New York!   And the Winner Is...




S
o Barack Obama is, again, the President.  What does this mean for your money?

            Well, if you have a good financial plan, it will mean only adjustments since a good plan is comprehensive, and allows for flexibility and uncertainty.

            On November 13, 1789, one week after the first Tuesday following the first Monday (i.e. Election Day - although, that very first Election Day was actually held on January 7th), Ben Franklin quipped, "There's nothing certain in life except death & taxes".  So, it's timely and prudent to explore what parts of the Tax Code affect you, because some taxes are going to have to go up.  (This is a great time to start learning about the US Tax Code by watching SFN's free videos at www.WomenAndMoney.TV.)

            This could be a good year to take previously deferred income and sell anything that will have a capital gain (profit).

            Tax management usually involves doing many small things rather than one big one, so it's important to understand a wide spectrum of issues that affect you.

            Income taxes can eat up anywhere from 10% to 50% of your income.  You can't consistently generate that kind of return from securities (e.g. stocks, bonds, CDs, mutual funds, real estate, gold, etc.).  Therefore, the best, first investment you can make, other than in your financial education, is in tax management.  Saving a guaranteed 10% - 50% is smarter than trying to generate 8%, an aggressive return these days.

            Also, federal estate tax rates can eat up more than 33% of your estate, not to mention state estate taxes!  So you may want to explore the results of death!

            If you have money in a Traditional IRA or 401(k), when you die, it will be exposed to both, income tax, and estate tax!

            This means exploring legal remedies (e.g. estate planning, trusts, charitable giving, re-titling assets, beneficiary designations, etc.) to protect your money from estate taxes, and possibly Medicaid, related to long-term care issues.

            The administrative issues and costs can be as daunting as the tax & financial issues, but well worth it.  It may cost you hours and hours, and tens of thousands of dollars to protect hundreds of thousands of dollars or more.  (However, if you itemize your personal deductions on Schedule A of the 1040 tax return, you may be able to deduct some of these costs!)

            You have a responsibility to yourself and society (if not dependents, loved ones, organizations, etc.) to plan for yourself; it's part of the Social Contract.

            Besides, do you want the government to make decisions for you?  Would you trust an IRS or Medicaid officer who showed at your door, and said, "I'm here to help."?

            So who's the winner in this election?  Will Congress allow the Bush-era tax cuts to expire, changing both income and estate tax?  Will they compromise?  Will they write new tax laws?  Will the laws be retroactive?!  There’s only six weeks left!  And what about the investment markets?

            Is your financial & estate plan up to date?

Who's your Trusted Family Advisor?

           

Friday, October 26, 2012

Ichabod Crane - I Remember Him Well...

44) Ichabod Crane - I Remember Him Well...

           (A $7.99 + S&H Predictive Halloween Tale)







T
he Crane family I knew, lived at the corner of my street.  Their property contained a pond with snapping turtles and a ranch-style house with a two-horse stable.  A wooden fence and thick Evergreens surrounded it.

            There were three brothers; I was friendly with Stuart, the youngest.

            Then there was Ichabod.  Poor Ichabod.

            Ichabod always wanted free food, wine, women, and a bed; and everyone knew it.

            In school, we called him 'Icky' because he constantly picked his nose.  And his hair was always unkempt, his fingernails filthy, and his clothes always wrinkled and disheveled; he was generally an unkempt slob.  He was skinny, scraggly, wore glasses, and walked pigeon-toed.  It was hard to move past his outward appearance.

            He moved into town during primary school, after many of our classmates had established 'elementary social circles', and was therefore, shunned.  He was a frequent guest of the Headmaster, who believed, 'spare the rod and spoil the child'.

Poor Ichabod.
  
            By middle school, he was a loner and quick to lose his temper.  Little did we know he'd also lose his head.

We never conceived he'd become a terrible, monstrous murderer, nor that he'd become infamous, after the newspapers serialized him along with the Revolutionary, Mercenary, Hessian, Headless Horseman who patrolled our woods after dark, making us respectful of our sleepy Hollow.  Yet, I suppose, the writing was on the wall - and the pumpkin shell - a spooky Jack-o’-lantern, was on the ground, across the bridge, poor Icky never to be seen or heard of, again…
 


            But bad things happen to good people and we just didn't realize what effect our behavior had on others.  Childhood learning and experiences have far-reaching effects and can scar us for a lifetime.  And scare us for a lifetime; to this day, you won’t catch me walking in the Hollows after dark.
 
(To boot, there was Horrible Hannah, who escaped from the mental asylum when it burned one year, who lived in the woods, came out at night, could run as fast as the wind, and could smell colors, leaving nowhere to hide!  A tale for another time…)

            Poor Icky.  What his youth must have been like.  And we feared he’d someday become a justice of the ten pound court; what would that have meant?

            We are most impressionable in our youth, and that’s our first exposure to money.

Historically money is 'dirty'.  Even Bugs Bunny spanks Babyface Finster for touching the dirty money ('Baby Buggy Bunny').  Parents tell children not to talk about money at the dinner table, and not to repeat things about it outside the home; spouses feel the need to hide or protect money from each other.  Money is hidden rather than explained, taught and integrated, which might lead to a healthy relationship with money. 

Later, as fairytales go, the boys learn business & finance, and go out into the world to ‘find/make their fame & fortunes’.  The girls go to the kitchen and learn homemaking & household budgeting, as they move from ‘Daddy’s House’ to ‘Husband’s House’.
 
Even fraternity Brothers who study business together and after college talk about their earnings, eventually stop doing so.  In spite of secrecy and loyalty, money becomes taboo and embarrassing - embarrassing about how much you earn and spend - embarrassing about how much you don't earn and can't spend.

            Friends won't invest with friends who are professional money managers due to attached stigmas and the potentially bad consequences.

Yet, in spite of similar privacy restrictions, people will confide in friends who are doctors, lawyers, and clergy, seemingly more intimate relationships.

People will share their secrets about sex, drug use, and health before they will about their money.

At best, having or discussing money is in bad taste; at worst, it’s a curse.

Do you share these values?

            So, if we all keep such secrets, and sow such seeds, teasing others, making ignorant value judgments and poor decisions, unhealthily inculcating our kids, living like greedy, amoral or immoral '1%ers', craving the greener grass on the other side of the fence, or even coveting another's belongings or spouse, do we not deserve what we reap?

            And what of the Grim Reaper?  You can’t take it with you.

Closed minds are more dangerous than closed purses and purposes.

            Money and Morality begin at home.  Their tiny buds can germinate at school, and eventually business and society.  The 'Haves and Have Nots' do not have to be measured in dollars, versus health, happiness, peace, creativity, family, friends, arts & entertainment, hobbies, and intellectual pursuits.  When we say someone is rich, we would need not qualify it by stating that we don’t mean money.  Wouldn't it be wild to have to qualify it as material wealth?


            So I tell my tale of an Icky Halloween.  Alas, poor Ichabod.  ('And what about Naomi?')

            Neighbors, heed well my hallowed warning: the Eve of All Hallows shall outlive your pursuit of currency.  Use your head, or lose it!  Make conscious, deliberate decisions about your quest for wealth; Icky rides this night!


            What's your relationship with money?  Is money a tool?  A prize?  A weapon?  Does it represent safety and security?  Do you use it for good?  Do you use it for evil?  Do you use it ignorantly or frivolously?  Is money, itself, good?  Or is money bad?  (‘The Shadow knows…’)

            What's important about money to you?

           

Friday, October 5, 2012

41)  Tornadoes in New York!







T
ornados in New York - again!  Tsunamis, earthquakes, hurricanes, early snow, global warming, sun spots, meteors, unchecked deadly  insect, and animal populations, Avian Flu, bio-warfare, cancer, obesity, nuclear meltdowns, terrorism, murder in the streets, murder in the home, auto accidents, accidents in the home, the end of the Mayan calendar; end of the world?!

            Will anyone be surprised if aliens appear?  How about if the Earth opens, and Godzilla or Mothra emerge?  (I venture to guess that many New Yorkers will still just try to make the light and catch their train.)

            Nevertheless, are you prepared?  Have you planned?

            "What's a woman to do?! "

           
Risk Management, fellow Terrans:

1.    Step 1: Use Common Sense - the least common type.  Extra groceries & water in the house, a  Go-Bag & escape route, computer back-ups, life skills, mental skills, tools, lists, B-plans.

2.    Step 2: Emergency Cents (cash).  Cash to travel, savings for emergencies (& opportunities!), repairs, unemployment, disability; self-insurance.

3.    Step 3: Credit Availability, short-term borrowing, and/or not having to carry too much cash.

4.    Step 4:  Insurance - transference of the cost, of a catastrophic risk, to someone else; OPM (Other People's Money); pay a small amount of money to reserve a large amount of money:

a.    Health Insurance
b.    Disability Insurance
c.    Life Insurance
d.    Homeowner's (incl. Renter's) Insurance
e.    Auto Insurance
f.     Professional Liability Insurance
g.    Other Insurance

            Life is risk; do you manage it?  - Or does it manage you?