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A Get Out of Debt Plan Ain’t Sexy…But

Having a get-out-of-debt plan ain’t sexy but it can have a huge impact on your future. If you don’t already have a plan, the best time to get started is NOW. Instead of waiting until the New Year, start now and beat the crowd. Sure it’s tempting to think that it will be magically easier in January than it is now but that’s not always your best option. In the meantime, you continue to pile up debt which only makes your situation more difficult.

So start the year off right with a plan that you have already started to implement. I know it’s difficult with all of things you want to do and buy during the holidays but try to step back and put things in perspective. Once you have a plan in place, you know what you have available to spend without busting your budget and putting your future goals on hold.

And to help you get started my new book, Squeeze the Most Out of Your Money, has a whole chapter devoted to debt reduction, and for a limited time you can download my 7-step plan to formulate a get-out-of-debt plan for free when you sign up for my mailing list.

Briefly, my 7-step plan includes:

  1. Putting an end to charging because you can never hope to get out if you keep charging,
  2. Making a real commitment to do what it takes to get out of debt and this may entail some sacrifices at least in the short-term.
  3. Reviewing your spending plan to see how much you have available to put toward paying off your debt.
  4. Creating a detailed picture of your current situation. In other words, how much debt you owe and who you owe it to.
  5. Negotiating with your creditors. This doesn’t always work but when it does, it can save you a lot.
  6. Deciding on a debt payoff strategy. The two main strategies that I advocate are paying off the creditor with the highest interest rate or the one with the lowest balance first. The key is once you decide on a strategy to stick with it.
  7. Implement your plan, monitor your progress, and celebrate your successes.

Don’t forget, sign up for mailing list and download the Squeeze Your Money 7-Step Plan to get-out-of-debt for free then let me know how your plan is going. ps!

Make Peace With Your Past: Write Your Money Autobiography

For better or worse, how we relate to money and possessions is often heavily influenced by our early life experiences and how money was handled in our homes growing up. One of the best ways to move beyond negative attitudes and beliefs about money, or to reinforce positive ones that we learned while growing up is to acknowledge their presence and how they impact the way we view and use money. Otherwise, we could easily spend our entire lives making decisions based on things we learned as a child that are no longer serving us in a positive way.

Writing your money autobiography is a great way to uncover the origins of your money beliefs and attitudes, and outline steps to counteract those you want to change. Start the process by taking time to reflect on the questions below. Answering them will provide you with some insights into the origins of your money beliefs. Then click here to download a FREE copy of Napoleon Hill’s original book, Think and Grow Rich to really get going in a positive direction.

Money autobiography questions to ponder:
General Family History

  1. Growing up, who were your money management role models?
  2. Who handled the money in your family?
  3. How did they handle the money?
  4. Was money discussed in your family?
  5. Was money scarce or abundant?
  6. How did your family discuss and express generosity?

Your Personal History

  1. What are some of your earliest memories of money?
  2. How is your money role like your mother’s?
  3. How is your money role like your father’s?
  4. What were the main money messages you received growing up? Did you follow them or rebel against them?
  5. Growing up, did you feel rich, poor, or something in between?
  6. What was the first money you recall earning? How did you earn it? How did you spend it?
  7. What is your biggest money success and what did you learn from it?
  8. What is your biggest money mistake and what did you learn from it?
  9. When you picture yourself as rich, who do you see yourself as?
  10. When you picture yourself as poor, who do you typically see yourself as?
  11. How much money has passed through your hands in the past 10 years? 20 years?

Your Current Family Life

  1. Who are your current money management role models?
  2. Who handles the money in your family?
  3. How do they handle money?
  4. Is money easily discussed?
  5. Is money scarce or abundant?
  6. How does your family discuss and express generosity?
  7. How much money do you anticipate will pass through your hands in the next 10 years? 20 years?

Summary points

- List your top three strengths relating to money:

- List top three weaknesses relating to money:

- If you are not where you want to be financially, what do you believe is keeping you from getting there?

Finally, take all of your ideas and write them down. Be sure to highlight the attitudes, strengths, and behaviors you want to keep as well as others you would like to change. Then consciously plan ways to get going in the direction that will work best for you. ps!

The Wage Gender Gap Could Cost You $2 Million

The financial consequences of Working While Female (WWF) can add up to a lot of  missed opportunities.

For all of us who are guilty of WWF we already know we earn less then men with the same job. Studies show that on average women earn 77 cents for every male dollar, and while that may not sound so bad in and of itself, have you ever wondered what that could add up to over your lifetime?

Well, according to the article “Gender Wage Gap: Are you paid as much as a man if he had your job?” by Evelyn Murph, the president of the WAGE Project and E.J. Graff, a resident scholar at the Brandeis Women’s Studies Research Center, the gender wage gap could cost you big time. Although this information is a couple of years old, I think it bears repeating:

  • If you’re a young woman who graduated last summer from high school, you will earn $700,000 less than the young man standing in line with you to get his diploma over your working life.
  • If you graduated from college, you’ll lose $1.2 million compared to the man getting his degree along with you.
  • If you graduated from law school, medical school, or got an MBA last summer, you’ll lose $2 million over your lifetime.

So you may be asking, why worry about this issue now? And what can you really do about it? It has been this way since the beginning of time. Well, call me the eternal optimist, but I believe that just because something has always existed one way that doesn’t necessarily mean that it has to continue that way. And, until you recognize a problem and it hits home, there isn’t much incentive to fix it. So consider this, the missing money in your paycheck could represent food you can’t buy, credit cards you can’t pay off, lessons your children won’t have, and retirement savings that you will never have the opportunity to enjoy. So this is not just one woman’s problem, it belongs to all of us.
One fix to gain some headway is to be proactive and practice the art of salary negotiation beginning with your first job and every job thereafter. As women, we are sometimes timid about negotiating a salary, but guys do it all the time and that is one of the reasons why they stay ahead of us when it comes to pay.

My question to you: Why do you think the gender wage gap still exists? Here are some explanations that have been given over the years. The gender wage gap exists because:

  1. Women aren’t as well educated as men
  2. Women leave the workforce to have babies
  3.  Women choose low paying jobs
  4. Discrimination

What you think? Do you agree or disagree with the explanations above and what we should do about it? Remember, our actions today will not only affect us, but the generations of women that come after us. No pressure here. ps!

Love and Money Infidelity

There is a new buzz word for a very old problem – financial infidelity.

Financial indelibility is basically keeping money secrets from your significant other. It can range from hiding an occasional purchase from your partner to secretly gambling away retirement investments, and it doesn’t take a genius to figure out that keeping money secrets in a marriage is not a good thing no matter how well rationalized.

Some of the common reasons people give for engaging in financial infidelity include:

  • A lack of trust in their spouse
  • Feeling they are entitled to get the things they want
  • Feeling that they are not entitled to buy things for themselves so they lie about it
  • To avoid a fight because every time they talk about money it turns into an argument
  • Revenge – to get back at a spouse for something they did or didn’t do

Because financial infidelity affects your finances as well as your relationship, many people believe it is actually worse than cheating because it can not only ruin your relationship but your bank account as well and leave you financially strapped for a very long time. So how can you protect your relationship? Here are three basic strategies to keep you and your spouse from falling into financial infidelity trap:

  1. Have regular money discussions.  Money issues are one of the leading causes of divorce so couples who can talk about money – their goals, their ideas about managing money, their concerns, and disappointments have a much better chance of creating a successful relationship. The problem is, many couples find it difficult to talk about money so they keep secrets. However, since secrets have a way of eventually coming out, by not talking to your partner, you could be risking your entire relationship for some unimportant stuff. Instead, try scheduling regular ‘money dates’ with your partner to talk about money. Find a quiet time and place to talk, and then discuss one issue at time. Listen to each other and give each other time to respond. If you are unsure how to start, start with the Love & Money Quiz and make it a fun conversation. Then discuss an area of concern and why it is so important to you on your next ‘money date.’
  2.  Have a ‘mad money’ allowance. Set a dollar amount that each of you can spend any way you like (typically $50-$200/mo.) so that you don’t have to sneak around every time you want to buy something or go out.
  3. Manage your money together. While you don’t have to do everything together, each of you should know your financial situation at all times. It’s okay to trust each other, but take the time to check in on occasion to stay up to date. Some important activities include opening and paying bills, creating a budget, and periodic reviews of your investments.

Don’t put your relationship at risk instead look for constructive ways to work through money issues with your partner. It can not only bring you closer together, but it can help you build a relationship that will endure through good and bad times. ps!

 P.S. Read more about financial infidelity in Bonnie Eaker-Weil’s book, Financial Infidelity: Seven Steps to Conquering the #1 Relationship Wrecker  

Lessons from Financially Independent Women

Financial independence can sometimes be an abstract concept until you achieve it. So I think it’s always helpful to take a peek into the mindset of those who have achieved it. Here are some comments made by wealthy women during a survey conducted about two years ago by Wilmington Trust and Camden Research:

 “I live below my means. … I live very modestly”; “It’s the same house that I raised my children in since elementary school”;  “I live simply and really focus on saving.”

If these comments sound rather ordinary, you might be surprised to know that the women who responded to this survey have a minimum net worth of $25 million, so they can well afford to live richly even during a recession.

But according to the study, there is a wealth paradigm shift going on and affluent women who once took on the traditional woman’s role are now taking control of their futures. The study concludes that they are “focused not on viewing their wealth as a measure of success but as a source of empowerment to achieve their goals and independence.” And this view was shared among women who worked for their money as well as those who inherited it.

Here are some other key findings of the study:

– Women are seeking a holistic approach to wealth management, which includes establishing internal family structures and openly talking about money, particularly with their children.

– Even though the women surveyed said they were raised in households with traditional views of a woman’s role, they are emerging with a commitment to develop their professional skills and to be viewed in their families and communities as having equal opportunities and status as men.

– Women are stepping up to new levels of involvement in the management of their families’ wealth, with 88% of those in the study playing a high-to-moderate role in the management of family assets. They are meeting regularly with advisors, reading investment performance reports, and trying to compile a complete wealth picture.

So what are some lessons we can take away from this peek into the other side of financial independence?

Whatever your means, live below them.

Take a holistic approach to your money and view wealth as a source of empowerment versus a measure of success. Viewing wealth as a measure of your success often means that you have to find ways to let others know successful you are and that can lead to overspending.

Step up to the plate. Be involved in the money management process of your family. Taking control means a lot more than just writing checks to pay bills.

Involve your children in the process early so they can grow up with an understanding of money management and they do not have to repeat many of the mistakes you made.

Get professional help if you need it. The right professional help can not only save you money, but they can save you precious time as you travel on the road to financial independence.

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