Seduced by Shopping

Why do women have the reputation of loving to shop? Probably because we do more of the nation’s shopping than men do. 

We buy groceries for ourselves or our families, we buy clothing for ourselves, children, and spouses. If your spouse is like mine, he avoids clothing stores, happily wearing what I buy him. In short, we women spend considerable time in stores.

Marketing gurus, and the clever people hired to create those attractive store displays often cater to women’s interests. The mall is a perfect example. Colorful themes draw us in, glittering jewelry displays entice, and music and the smell  of cookies and perfume overload the senses. Everywhere there appears to be an abundance of interesting and useful products that promise to make us happy.

I sometimes find myself walking the aisles of a store, but forgetting what I really needed because I’m distracted by the displays. I might just need some socks, but socks are never in the front. You’ll have to walk by the purses, the shoes (two things women love), the jewelry display and more before you find the socks. They must teach courses in product placement to get us to buy more.

Who benefits from more sales? The stores and corporations do, of course. Who is hurt by unnecessary spending? Mostly women, since we spend more time in stores.  It’s our bank accounts that drain down, our savings that stay flat, our future choices that get limited when we focus more on today’s spending and neglect tomorrow’s needs.

Now, I’m not against spending, but unless you’re Paris Hilton, your income is limited and choices need to be made.  You’ll need to balance the needs of the present with the needs of your future. In your future, there will probably come a time when you’re unemployed, or staying home to raise a child, or you need to retire after decades of work. Where will your income come from then?

It will need to come from your savings. In the natural world, squirrels and other animals save part of their harvest for uncertain times in the future.  Survival and comfort are more assured when we “squirrel away” something for later. At The Silver Purse.com, we recommend saving 10% or more of your current income for later needs.

Worried that you won’t benefit from it today? Relax, it’s still got your name on it in your bank or investment account. You will have planted a seed that will grow over time into a sheltering tree for you and your loved ones. Redwoods can’t be rushed, and neither can your investments.

If you start saving early in your life, you’ll create a solid foundation that will give you more choices later on. And with the power of compounding, the growth of your money over decades can be huge.

So, next time you take that trip to the mall, think about the choices you have, and listen to your future self whispering. It’s calling too. It says, “Send more money!”  

How do you avoid spending too much during the holiday season?

How do your money beliefs affect your success?

Can psychology and beliefs harm or help your financial success?

I just finished reading a couple of books by Barbara Stanny, a leading authority on women and money. Her story is interesting. She is the daughter of one of the founders of the famous tax preparation firm, H&R Block. 

In spite of being in a prominent family with lots of wealth, she was never taught financial basics. Her first marriage ended in divorce after her husband squandered most of her inheritance and left her with very little but a million dollar tax bill she couldn’t pay.

 

Determined to figure out why this had happened, and needing to support herself and 3 young daughters, she studied the psychology of money--especially relating to women. She researched and wrote 3 books: Prince Charming Isn’t Coming, Secrets of Six-Figure Women, and Overcoming Underearning™.

How does this relate to you? Many women find they are dissatisfied with their earnings and/or concerned about their financial future. This translates into symptoms ranging from a mild lack of fulfillment, to stress, strained relationships, and even a life of hardship and unhappiness. 

Women tend to underestimate their worth, prioritize caring for everyone else first, and feel undeserving when it comes to “wealth.”  This creates a perfect stew of crossed emotions that doesn’t serve us well. 

Very few women (or men) have been taught the skills to create both financial success and personal fulfillment.  We’d all love to find that perfect balance of work and life that reward us amply, and also provide us with time to recharge and refresh. 

Enter the book, Overcoming Underearning™.  In it, author Barbara Stanny lists 5 goals for her readers:

1.     Change your relationship with money.

2.     Explore your blocks and barriers to success.

3.     Inspire you to think bigger.

4.     Keep you on the path.

5.     Encourage you to share what you learn. 

I was inspired, challenged and enlightened by the book. Here’s the link in case you want to read it.

http://www.amazon.com/Overcoming-Underearning

 

I realized no amount of training or knowledge can help a woman find financial success if she doesn’t first get clear about what she wants, how she relates to her finances and self-worth, and what unconscious barriers may be holding her back. And yes, we all have unconscious “blocks and barriers”—some even coming from childhood.

The Overcoming Underearning™ book includes worksheets, inspirational quotes, and exercises. It’s more than a book about earning more or financial success. It’s a book about personal growth, with financial success tagging along in its wake.

One of Barbara Stanny’s recommendations is to find “True Believers, Confidantes, and Way Showers” to help you reach goals. Think about the people in your life who truly believe in you, the people in whom you can confide, and those who can show you the way forward. (Try to steer clear of the “Naysayers” Group.)

If you don’t have appropriate people to help you, consider reading Barbara Stanny’s book or finding additional help through mentors. 

I recently spoke with a colleague from New York City, Lora Sasiela, an experienced “money therapist” and Licensed Clinical Social Worker (LCSW). Lora calls herself a "Money Makeover Artist" who specializes in helping women move beyond money barriers and blocks.  Her e-book, Girl Meets Money, is a fun and sassy short read with actionable tips. Here’s the link, and the free e-book sign-up is on the right side of the page. Enjoy!

http://www.financiallysmitten.com/meet-lora/

Lora is generously offering a “Breakthrough Session” to members of The Silver Purse community for 25% off.  This special offer runs from October 7^th to October 14^th midnight EST. Use the special coupon code “SILVER” to get the discount. Here’s the link to find out more about her sessions, which are done by phone.

http://www.financiallysmitten.com/breakthrough-session/

 

Whether you dive in with a professional, or just tune in to the topic of Behavioral Finance on The Silver Purse website (Mind and Money)--pay special attention to your beliefs and thoughts. I believe they offer a secret key to long-term financial well-being.

Fairy tales and timing the market

I loved fairy tales when I was young. They always conveyed a gentle lesson through the power of story-telling--and who doesn't love a good story?

Fairy tales often came in 3 parts: a myth that ends up getting busted (like princesses can't take care of themselves), some magic that might involve effort or a new way of thinking (the princess steps out of her traditional role and saves her people), and a moral (things aren't always what they seem.)

So how does this relate to investing and building financial security? Let's look at one of the biggest challenges people have--when is a good time to invest?

Here's one fairy tale about timing and steadiness.

Fairy Tale: The tortoise and the hare

In the fable, the tortoise and a hare (rabbit) made a bet on which one would get to a finish line fastest. 

The hare was cocky because he knew he was 10 times faster. Both started the race at the same time. The tortoise plodded along, slowly but steadily putting one foot in front of the other and not stopping. 

The hare, on the other hand, raced ahead, leading by a wide margin, then stopping to indulge in breaks, since he figured he could always make up the difference later. On one of these breaks, he fell into a nap. The steady tortoise finally passed him dozing under a bush, and crossed the finish line first to win the race. 

What 3 elements here can be related to your "journey" towards financial security?

Myth: Believing investments are safer to buy only when they show current strong performance is the way to profit. 

Magic: Buying small, regular amounts of investments no matter what the market is doing can pay off. The technique of "Dollar-cost averaging" buys more shares when the price is lower and fewer shares when it’s higher. Over the long term, it’s a truer, more secure and steady way to build wealth.

Moral: It’s what you do on a steady, regular basis that determines your long term financial success. Remember, it's the time you spend in the market, rather than timing the market that counts.

Don’t assume everyone else is always faster/better/smarter with their money. And don’t give up before you’ve even begun. Steady investing, even of small sums, can lead to long-term rewards. Reminder--the race can’t be won until you start.

How dollar cost averaging works--Wikipedia link. What's your biggest challenge when it comes to reaching your investing "finish line?"

Desert or Garden in Your Future?

I attended a conference in Tucson Arizona last week. The conference was engaging, instructional, and full of great networking.

But one of my biggest "Ah-ha" moments happened on route, as I drove through hundreds of miles of desert. 

The laser straight freeway dissolved into watery mirages in the distance. Rocky, chocolate-brown mountains lanced the sky with sharp castle-like shapes. Hot dusty winds buffeted the cars and trucks as they whizzed through this dry, almost empty landscape. Landmarks like Tonopah and Coyote Gulch broke up the driving monotony.

It led me to think of how life could be sustained in the desert. In fact, it's harsh and almost impossible unless one can find water and shelter.

The same harsh reality faces people--especially women--who don't put something away for their future and retirement years. They will face a desert, with no resources except the sparse greenery of a small Social Security check.

I ran across an article a while back titled, "Can you live on $987 a month?" It referred to a then-average net Social Security check. This works out to less than $12,000 per year. Most people would be scratching around to make ends meet-- just like the desert tortoise. They'd be in a land of scarcity--just like the desert.

I'll admit here that I spent years of my childhood in a desert, and have a certain fondness for wide-open spaces with distant vistas. But I also learned some skills to survive, and a healthy respect for the dangers of the elements.

So, what does it take to turn your future from a harsh desert into a more comfortable garden, replete with water, sources of food, and creature comforts? You probably know part of the answer, but I'm going to offer you the rest. 

You can sign-up for this free ebook/ report called "Six Steps to a Bigger Retirement Paycheck." I promise, it's a fast read and I've thrown in some light-hearted surprises to keep it fresh.

Don't let your future be trying to survive in a financial desert. Plant the seeds now to grow a blooming oasis with foods to harvest. Start here.

Golden Opportunities

Sometimes life offers you golden moments. Other times, life gives golden lemons. Either way, there is something to learn.

In the last couple of weeks, the wildflowers have been popping up all around my rural home in the mountains. They have offered a golden moment for me. See what they look like here.

Meadows have been covered with golden blooms, hillsides have been sprouting purple and yellow lupine. (The photo is of yellow lupine.)

All this gold in Mother Nature inspires me to think of golden opportunities. How often do we find those special moments, unique offers, or life-expanding opportunities? They may seem rare or few and far between.

In reality, they are present every month--even every week. But they might not be visible if we're not focused on looking for them. I know I've had periods in my life of diversion by worry or set-backs. A negative focus can push all positive (read "golden") opportunities so far into the background that they're almost invisible. You'd need a telescope to see them.

But really, these golden opportunities are just patiently waiting for us to notice them. They're quietly parked in the background, perhaps shining a little in the darkness. We only see the stars at night, when the competition of sunlight is removed, even though the stars are always present in the sky. We only see golden opportunities when there is less distraction in our mind, yet they too are always present.

What does all this have to do with building financial security--the goal of The Silver Purse? Lots.

There are 3 key actions that can lead to more prosperity and abundance in your life. These actions also lead to more personal fulfillment and the ability to help others more deeply. To do them, we must find golden opportunities regularly.

1. Earn enough to feel your services are valued. Earn enough to save something for your future self and loved ones.
2. Consider starting a business. Entrepreneurs with insight and patience can build wealth that benefits their families for a generation or more. Women are starting businesses at a greater rate than ever before.
   
3. Invest. How do the most successful people grow their money? If it's not a business, it's through investing. Often it's both.

Golden opportunities to do the above things start with mindfullness. They present when we are open-hearted and feeling grateful. They offer themselves up when we give ourselves a rest from daily distractions and look at the big picture.

Opportunities are more recognizable when we've set personal goals, and preferably written them down. There is a power in the written word. It's an affirmation of what we desire from life. It also imprints upon our mind, which then looks for ways to make those goals a reality.

Your golden opportunity may come through attending that networking event, exploring a topic you've always thought would make a good business, or finally opening up that first IRA account. It might be giving yourself a "Me Day" where you focus on goals and your future and daydream a bit. It might be as simple as stopping for 10 minutes to admire the sunset, allowing your mind to open to new possibilities.

Sometimes the most important things in our lives get pushed to the background, patiently waiting to be noticed and acknowledged. They may be the golden opportunities we've been looking for. Watch for them, then go and get immersed in them, like I did with my flowers.

Want to tell me how you stay open to new opportunities?

The Charm Bracelet Style of Saving

Charm bracelets can personalize jewelry in a fun way. When I was young, I loved looking at all the charms girlfriends would collect. They may have had charms that reflected hobbies, like tennis or knitting. Birthstones or tiny purses and symbols of things we loved (pets) were also popular. No two bracelets were alike. They often grew with a spontaneous purchase. "Ohh, gotta have that!"

But what do charm bracelets have to do with your savings or investments? Many people collect savings or investment accounts in the charm bracelet style. They may have read about a top-performing fund, and wanted in right away. Or perhaps a friend suggested a new "high-yield" account at a particular bank or broker. Accounts may be accumulated in a haphazard way with no overall plan.

Getting recommendations from friends can be a way to discover new opportunities. Or, it can be a crazy quilt way of portfolio building--not really meeting your long-term needs. You may end up with too many accounts of one type and not enough of another, which lowers diversity and can actually increase risk.

Overall, you'll benefit by having a basic plan. The plan should be based on YOUR goals and time frames, not just a whim of the moment. Don't get distracted by shiny-object places to put your money. For example, many people rushed to buy annuities, without understanding the rules and the penalties for early withdrawal.

Your future goals determine how much cash you should keep (more if you have big expenses coming up.) Your plans also determine how much you'll need for your future, such as retirement accounts. Use this page for retirement planning calculators.

You can make long term investing easier with Life-Style or Target-Date funds that select investments based on your age. The Silver Purse website offers a free Members Page that includes a report on the pros and cons of Target-Date funds. Sign up at the silver purse to see this report. (We always respect your privacy, and do not rent, sell or share your address.)

Charm bracelets can be adorable, but collect investment funds in a more planned way for the best success. Care to share your tips for choosing a savings or investing account?

Cathedrals and Your Future

There is a $6.6 trillion shortfall between what Americans need to retire, and what they will have, according to a report cited by Charles Schwab. Ouch. This is likely to have big social repercussions, and may alter our society.

Is this future lowered standard of living preventable? Mostly it is, but it requires us to do something which doesn't always come naturally--plan ahead, sometimes far ahead.

Big vision projects take wide thinkers who can plan into the future. Consider the cathedrals of Europe. Many of them were constructed in the 12th century, and took over 100 years to build. The architect/designer who started the project likely only saw it half finished by the end of his life. Others carried the dream forward. The vision that planted the seed sprouted graceful tall cathedrals that inspired millions of people for centuries to come.

Saving for retirement is not nearly as challenging as building a Gothic cathedral from stone. It does take some vision and perseverance though. Here are three things you'll need to do.

1) Picture your future and how you will live.
2) Find out what you'll need for the lifestyle you choose.
3) Set up automatic savings to help meet your goals.

#1 is all about finding your motivation. When you can actually picture yourself as your older self, doing something you love, your future becomes more real. If there are hobbies you want to do, or a lifestyle you want to keep, envision that. The more tangible, detailed and real your future seems, the more motivated you will be to make small sacrifices today for a better future next year or next decade.

#2 is the technical side of things. It involves using some financial calculators and/or getting some help with financial planning. If you need $50,000 a year to live on now, and want to keep that same income level, adjusted for inflation, financial tools or financial planners can give you the answers for how much you'll need to save monthly.

#2 part can also involve choosing the best types of investments to meet your goals. Again, this can be technical, or just pick an age-appropriate Target-Date fund that diversifies automatically.

#3 is relatively simple, as it involves setting up savings and investment contributions. Here's where you take steps to fund your future. You previously discovered how much you'll need for your retirement. Now, you'll take that monthly savings target, and start contributing. If the monthly savings target is higher than you can afford, just do the best you can. Contributions you make now will have the opportunity to benefit from compounding growth over time. Compounding can turn even modest regular savings into fatter retirement accounts over a 20+ year period.

The architect of the 12th century may have gone to bed dreaming of sun shining through stained glass windows and choir song amplified by vaulted ceilings. Your dream will be different, but still lofty on a personal level. You'll need to think 10, 20, even 40 years into your future. You're planning income support for the 20-30 year period of your life we call retirement, when no income comes in from employment.

Think big, find your inspiration--then plan to succeed. Your future self will thank you.

What's your biggest challenge when you plan for your financial future?