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HAPPY NEW YEAR 2018 Financial Checklist by @AZanswers

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by Ann Zuraw | Featured Contributor 

HSA—Check if you are eligible for a Health Savings account.  An HSA is a medical savings retirement account and can be started with pretax money and withdrawn to pay medical expenses without taxes.

Asset Allocation—Review your overall investment portfolio.  What percentage do you have in stocks, bonds, or cash and how did it change over the year?  Do you need to rebalance?

Protect yourself with an emergency fund to plan for the unexpected – An expensive car repair, having to replace your air conditioner, or a leaky faucet is stressful enough.

  • Not having to worry about the expense b/c you have an emergency fund can really lower stress and allow you not to put off repairs which can cause even more damage

Prioritize your personal need for spending vs. saving– Start tracking your expenses and group them into two categories: fixed and discretionary. Everyone’s income and expenses are different – there are no two budgets the same.  You have to find what works for you and what your comfort level is – decide a minimum amount to keep in checking/minimum for savings/ and look to invest the rest.

Your risk tolerance—learn what it is and understand what it means for your investments.

  • Everyone has a different tolerance for risk – figure out your own.
  • Know your limits – how much are you willing to lose before pulling back on your investment.
  • Find a strategy and stick with it over the time horizon
  • Diversify, diversify, diversify!

Never Give Up and keep trying even if you fail at times.  Success is not going to happen if you do not try.

Estimate your realistic profit and cash flow for the upcoming year. Do this both for your business and for your personal life.

What concrete steps are you taking to achieve all your financial goals?  Are your goals Identified, Implemented or Ignored?

Your investment style—What is your personal style and preference?  Regarding both managing your business and how your retirement account is invested?  Where are you investing your assets and what are the gaps?

Estate Planning – The new tax code means significant changes for estate planning for passing on assets to the next generation. Talk to your financial or trusted advisors today about what it means for you.

Attitude—there are no “stupid” questions.  Have a positive attitude about your ability to handle money and ask for help when you need it.  You deserve it.

Realistic goals—Don’t overwhelm yourself and get frustrated by trying to solve everything at once. You need to take baby steps, establish your targets with a clear head, and can get started on this today.

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Planning for the  ”What ifs” affecting your Financial Life by @AZanswers

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by Ann Zuraw | Featured Contributor 

Planning for the ”What ifs” affecting your Financial Life.

 

Incapacity Planning

Incapacity of the mind can be a temporary condition or a long-term decline as one’s mental abilities begin to slowly “diminish.”  The older I am, the more I see situations that differed from expectations.  With more experience, I recognize the value of operating within “my lane of expertise.”  So as a female business owner, Mom, and investor, my advice is generated from that perspective.

What infrastructure do you have in place in case the unexpected occurs?

My 92-year-old Mother recently asked me what would happen to my client’s accounts if I had a stroke. Now let me remind you that I am perfectly healthy and based on my parents’ ages of 92 and 93—I have a long way to go…. Despite this, I do have a succession plan in place since this is “my lane” of expertise.  I diligently prepare for the unexpected in both my personal life and my business. Is your business and family ready? Do you have a plan in place?

There is a lot of emphasis on “succession planning” for people nearing retirement. However, the looming number of unexpected setbacks that may occur throughout life makes having a succession plan at every stage in life a reasonable necessity.

What resources are there to help with succession planning?

  • To Do List for Incapacity Planning: I encourage individuals, families, and businesses to be proactive in their life planning for the unexpected. Everyone should have all their legal documents in order and have an established plan for their succession. Check out some key actions needed to prepare a proper life succession plan.
  • Trusts: It’s important to emphasize that it is your responsibility to ensure a solid plan is in place should you become incapacitated. I strongly advocate the importance of having a Trust. Trusts provide you with a partner, the trustee, to help share the responsibility for whatever lies ahead. So, if you feel overwhelmed by the thought of going on this journey alone, consider using a Trust.

Answers from A to Z

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Financial Planning As Self-Care by @LundeenAbrams

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by Suzanne Lundeen Abrams | Featured Contributor

I suggest women reverse the golden rule and treat themselves as well as they treat others.” -Gloria Steinem

Entrepreneurs give everything to their business: Customers come first! This way of thinking comes easy to an entrepreneur. In everyday life, women often prioritize the needs of others and in so doing, postpone or neglect critical self-care. Taking care of ourselves as women, is important but that doesn’t mean it comes naturally.

As women business owners, we need to schedule it in or it doesn’t happen, right?

Scheduling “Me Time”

When we think of self-care we tend to think of stress relief: bubble baths, mani-pedi’s or gab-fests with our girlfriends. Personally, I love a little retail therapy, although paying the bills a couple weeks later can create a vicious cycle. Many of our go-to self-care approaches cost money.

Does thinking about finances stress you out? I think we all carry some anxiety about money which can backfire when what we need is a little self-care to undo all the other stress of giving and caring for others first.

Life is expensive and it gets more complicated when you’re running a business and the number of people counting on you increases – employees, customers, family members, etc.

Taking time out of life to decompress is important. Did you ever consider the fact that financial planning can be a great stress reliever, too? When you take time to plan for the future and get your ducks in a row, financially, you’re actually taking care of your future-self.

So schedule time to sit with yourself and think about your financial life. Reflect on where you are now and imagine how you’d like things to be in 5, 10, or even 20 years down the road. We need to carve out time in our busy lives to think about what we’re actually trying to accomplish.

Bring a pen and paper because someone has to keep notes for the meeting.

Honing Your Financial Physique

Establishing specific goals allows you to focus on what is most important and helps you avoid distractions that can sidetrack your good intentions. Every time we spend money we should ask ourselves, does this align with my financial goals or is it diminishing my capacity to fund my goal?

We live in a world where instant gratification is not only common, it is expected! Resisting impulsive consumerism takes self-discipline and focus. Budgeting is difficult. It means saying no to things we may want now so we can have more of what we really want later.

The discipline needed for physical health and wellness is similar to financial fitness and I believe women deserve a ton more support in the financial realm. Here in the U.S., it seems the size of our booty is far more important than the shape of our financial lives. Women are bombarded with messages that teach us from an early age that our physical beauty is our most valuable asset.

Financial Fitness as Self-Care

Financial Fitness as Self-Care (custom illustration by Jayde Perkin)

We may, indeed, be total knockouts – but even Helen of Troy’s beauty could not rival one of our most powerful tools as women: our wealth.

You may not feel wealthy but let me assure you, your wallet or purse – be it Coach or Mossimo – goes everywhere you go and how you use it matters.

In the U.S., women hold nearly 40% of the nation’s investable assets: $11.2 trillion.

Globally, women hold 27% of the world’s wealth: $20 trillion.

We have some weight to throw around, right?! Well, hold up…

Women face unique financial challenges which makes managing our money effectively that much more important.  

Top 5 Factors that Hold Women Back Financially

Many of these factors seem largely out of our personal control because they’re deeply embedded in our culture so we can either make lemonade with the lemons we’ve been served or work on changing the culture. It’s not all sour lemons, though.

Living longer sounds like a very good thing to me! 

Live Long and Prosper

The Gloria Steinem quote above that inspired me to write this post is from Jean Chatzky’s recent #HerMoney podcast. Jean asks Gloria about her plan to live to 100 (or 110) and Gloria’s quip back to Jean was priceless, “I have to, just to meet my current deadlines.” Spoken like a total GirlBoss. When we set our minds to achieving something, nothing can stop us.

Whether you live until 80, 90, or 110, the cost of living and care you’ll likely need will be inflating from now until then. Stashing away more money now and investing for the future of your dreams is simply good self-care.

Reverse the golden rule in your financial life and commit to treating your future-self the way you’d really like to be treated.

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Securities offered through Securities America, Inc., a Registered Broker/Dealer, Member FINRA/SIPC,
Suzanne Abrams, Registered Representative. Advisory services offered through United Advisors, LLC,
a SEC Registered Investment Advisory Firm, Suzanne Abrams, Investment Advisor Representative.
United Advisors, LLC, Lundeen Abrams Advisors and Securities America are unaffiliated.
*The opinions and forecasts expressed in this piece are those of the author and may not actually come to pass.  This information is subject to change at any time, based on market and other conditions and should not be construed as a recommendation of any specific security or investment plan.  Past performance does not guarantee future results.
All material contained herein is for informational purposes only. This is not a solicitation to offer investment advice or services in any state where to do so would be unlawful. Past results are no guarantee of future results and no representation is made that a client will or is likely to achieve results that are similar to those shown. Please refer to disclosure document for additional information and risks.

 

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Do you OWN your financial future? #OwnMyFuture

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Do you OWN your financial future? #OwnMyFuture

Disclosure: This post is sponsored by SheSpeaks and Prudential, but all the opinions are my own.

by Melissa Stewart

When I was asked to take part in the Prudential #OwnMyFuture campaign about owning your financial future I thought YES! After all, I’m all about owning it. The hashtag spoke to me and I enthusiastically accepted the invitation. Then the reality of the topic set in. They wanted me to talk about money. They wanted me to talk about long-term financial planning. Life insurance. Retirement.

It was intimidating.

I didn’t feel qualified because I don’t have a fully funded retirement account or life insurance or…

Visiting the Great Smoky Mountains National Park.

You see, I’m a single mom of 4. My oldest son was born when I was a 17 year-old senior in high school. My boys are my world. Financial planning always took a backseat to today and now. My focus was on my family and our immediate needs. I wanted them to have all I could give and experience all we could experience on my one woman income. I worked full-time and side hustled like a boss. Budgets and a retirement plans were something I would think about later. After all, there’s plenty of time for that “someday” – when the kids are grown, when I make more money, when I have more time…

A family trip to Pikes Peak in Colorado.

And so it goes.

I reached out to the She Owns It community to see where our readers were on the subject. I was surprised with the answers.

Many of the responses went like this:

“Melissa, the years during and immediately after the great recession were tough. My business is only just beginning to recover now. During those years I neglected saving for my retirement. I will be changing that now that my business is back on track and doing better than ever. I do like using a financial planner.”

It’s never too late to take the kids to Disney World.

“I haven’t been as focused on this as I should be.”

“Hey Melissa, I’m the worst at financial planning for retirement.”

“Thanks so much for reaching out, Melissa! To be completely transparent, I’m just starting to dip my toes into this arena…”

“I need to do more planning, even as a single woman with no kids I have parents that I help and need to prepare for who’s going to take care of me when I am unable to.”

“I was raised with the belief that I would always have to work harder than everyone else and that I would never be rich.”

“Oh gosh I’m terrible!!! I need advice.”

“I’m playing catch up after two decades of single parenting and entrepreneurship when I wasn’t able to save, so 50% of my income goes straight into a money market account.”

Many of these responses echoed my own story.

Where am I now? Even though I put long-term financial planning on my “to-do” list, I was thankfully still smart with my day-to-day money decisions. I was scrappy and resourceful during the lean years and today I find myself with an empty nest and debt free. I’ve put an emergency fund into place and I’m working on that “someday” retirement plan.

I don’t know your money story but that’s a little of mine. I want future generations of women to tell a different story. I want them to be empowered from day one with the facts, knowledge, and confidence to become financially independent with fully funded retirement funds, college funds for the kids, and drool worthy  investment portfolios.

If I could have a conversation with my younger self, I would tell her to be bold and stop playing it so safe. Start taking steps (even when things aren’t “perfect”) towards your dreams. Baby steps are still steps. Start saving. Start investing. Start a business. Just START.

I also got some very encouraging responses:

“I hired a financial planner in my 20s when I was an entrepreneur. I was making good money by then and I knew I was not the best person to manage it. He helped me take my “stockpile of cash” (as he called it) and invest.”

“The biggest aha moment I had about finances is that I’M DESERVING OF FINANCIAL HAPPINESS and that I’m worthy of being successful…I prepare for the future, but I also LIVE and spend money on the stuff that’s important to me.”

And many of you did respond that you were actively saving.

Knowledge is power.

Did you know:

  • On average women’s have 30% lower retirement balances than men1
  • 44% of women have no life insurance. Even among the ones that do own life insurance, most are underinsured2

Isn’t that crazy? There is a real paradox here. Women retire with 67% of the wealth of men, and they live 5-6 years longer than men do.3 Women are more likely to be single later in life.  Marriage patterns have changed over the last few decades.  Divorce has become more prevalent, and more women are choosing to remain single.4

It’s 2017 and these are the facts. Prudential has been researching the financial challenges women face for several years. The Financial Experience study tracks women’s outlook towards financial planning. Women do care about financial security (their most important goal is having enough money to maintain their lifestyle through retirement). Prudential has learned that many women don’t care for the financial services jargon and they feel time-starved and cash-strapped. So even though they take care of day-to-day budgeting, they leave out some of the important pieces of long-term financial planning such as insurance and saving for retirement. We characterize this behavior as lower engagement.

Here are some pretty eye-opening gaps that exist for women:

1) Wage and Income Gap:

  • The average woman working full-time earns 79% of the income earned by her male counterpart.5 This is because of many issues – lower likelihood to negotiate salaries, time out of the workforce, differences in pay.
  • The wage gap not only impacts women’s 401K balances over their lifetime but it also impacts their social security payments. Predictably women’s social security benefits are 27% lower than that of their male counterparts.6

2) Investment Gap: Women don’t invest to the same degree as men. 7 Women’s discomfort with investing comes at a high cost for them: They are apt to delay investing, invest more in lower risk, lower return investments and are more likely to run out of money in retirement.

3) Women Are Living Longer and Living Alone: Women outlive men by an average of 5-6 years. 3 Are they prepared financially for these years?

4) Time Gap: On average, women in the U.S. spend 28 hours per week on household chores – 65 percent more than the average for men.8 That is uncompensated work and it does not figure into women’s financial planning. Prudential has created a tool called the “Value of all you do” that lets you very quickly quantify the value of all the household chores you do on a daily basis. What you would need to pay someone to do those for you.

What am I hoping the outcome will be from this post? I want you to Become Aware. I want you to become an ACTIVE participant in your financial future. Become educated and aware. Visit Prudential’s site and use their resources to help gain a better understanding of the challenges we are facing and then take action. That’s what I plan to do and I hope you will join me so we can all OWN OUR FUTURE.

Sources:

  1. Source:  Prudential Retirement analysis reflecting defined contribution plan balances of Prudential record-kept plans as of December 31, 2015
  2. Source: LIMRA study, Life Insurance Ownership in Focus, U.S. Person-Level Trends: 2016
  3. Source: Prudential Retirement analysis; National Center for Health Statistics, Health, United States, 2015: With Special Feature on Racial and Ethnic Health Disparities. Hyattsville, MD. 2016
  4. Source: Cruz, Julisa, “Marriage: More Than a Century of Change” (FP13-13), National Center for Family & Marriage, 2013,)
  5. Source: U.S. Census Bureau, Historical Income Tables Table P-40: Women’s Earnings as a Percentage of Men’s Earnings by Race and Hispanic Origin, 2016
  6. Source: Social Security Administration, Fast Facts and Figures About Social Security, 2016
  7. Source: http://fortune.com/2016/05/11/sallie-krawcheck-ellevest-launch;
  8. Source: Organisation for Economic Cooperation and Development, October 2016, http://stats.oecd.org/index.aspx?queryid=54757
  9. Source: US Census Bureau 2015;

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America’s Invisible Workforce: Caregivers by @CJBinsurance

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Photo Credit: TheeErin via Compfight cc

Photo Credit: TheeErin via Compfight cc

by Carly Barker, CLTC | Featured Contributor

They’re called America’s “invisible workforce” — and you likely know at least one member, or are one yourself. I’m talking about family caregivers. These are people who may have demanding careers, but are forced to cut back, or put them on hold, to care for ailing or aging parents. The caregiver role may not be a full-time job, and it may be shared with another family member. However, regardless of its structure, it places an enormous burden on families.

For better or worse, the bulk of caregiving for the elderly, ailing, and disabled falls on women. Culturally, women bear the primary responsibility for the home and the kids — all while managing their own careers. And it’s women again who primarily help relatives when they are too old or sick to care for themselves. This is the Sandwich Generation: They’re stuck between caring for their kids and parents.

One of my clients is an attorney who was on the fast track to becoming a partner at a prestigious national firm. She worked hard to get there — she made Phi Beta Kappa at Stanford, graduated from Harvard Law School, and spent years in the trenches working 12 to 14 hour days. An only child from a modest background, her mother died when she was very young. She and her father were very close. He worked two jobs to pay for her prestigious education, and he was extraordinarily proud of his accomplished lawyer daughter.

But then her father was being treated for a very aggressive form of cancer. His income had gone to pay for her education, not disability insurance nor long-term care insurance, and he required a lot of care. His medications left him disoriented, so he was no longer able to drive. He needed help with the daily routines of bathing, preparing meals, and taking his medications. His daughter knew that it was her turn to take care of the father who had always been there for her. She took a leave of absence from her law firm. While she knew she’d be able to return to her job, she also knew she was taking a chance with her career.

Thanks to advances in modern medicine and technology, our life expectancy has increased significantly. This is great if we’re fortunate enough to stay in good health and if we have the financial security to enjoy the extra years. We all want to grow old gracefully and die peacefully in our sleep. Sadly, for most of us, that is unlikely. The reality is that most of us will require assistance in our later years to carry out the basic tasks of living.

Unfortunately, on a fairly regular basis, I receive inquiries about long-term care insurance from people who are already in the midst of treatment and not eligible for coverage.  If only they had contacted me sooner…  Now they’ll need to rely on family, friends and the nest egg they had hoped would provide a nice cushion for enjoyment – not for personal care.

Those family members needing help might have been able to stay on their own longer had some planning been done and long-term care insurance been purchased earlier on, when they could have qualified. Fortunately, now there are many interesting options in the long-term care insurance market. By doing a little homework, in essence, a person can craft a plan to fit a budget. Some plans have life insurance attached where benefits are paid if a person dies before needing care.

For those who are already immersed in the caregiving role, don’t be shy about asking for help. As they remind us on airplanes, you need to take care of yourself before you can take care of others. If you know a caregiver, reach out to see if there’s anything you can do to help. It might be something as simple as reading to the parent or family member a few times a week to give the caregiver a much-needed break.  Sometimes, simply reaching you to check in can make all the difference in a person’s day.

For more information, contact Carla-Jean Barker at http://www.cjbins.com, via Twitter @CJBInsurance or on LinkedIn

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CJB IMAGECarly Barker, CLTC has been an independent insurance broker for more than 20 years and is known for providing unparalleled personal service. She works with clients all over the US, has taken courses in financial planning which has proven instrumental in serving her clients and interfacing with other professionals, as she understands that insurance is one part of a person’s financial picture.

Carly is an educator; she carefully presents information in a way that informs and makes her clients feel comfortable with their decisions

Carly lives in Berkeley, CA, but grew up in New Jersey, and attended Sarah Lawrence College. Deciding she needed to experience life outside the New York metropolitan area, she transferred to UC Berkeley, graduated with a degree in East Asian studies, then spent three years in Tokyo. She’s studied Hebrew, Japanese and recently returned from an extended sabbatical in Argentina where she studied Spanish. Carly is committed to living a balanced life—healthy food, plenty of exercise and personal development that includes yoga and meditation. Carly also enjoys life coaching, is currently getting certified through CTI (thecoaches.com) and is a graduate of their Leadership program.
Links below

www.cjbins.com or Linkedin | @CJBinsurance | @coactivelife

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