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The Gift of Awareness

There is freedom that comes with awareness, because with it comes the opportunity to make a choice. Madisyn Taylor

Happy New Year! This is the fresh start, anything-is-possible time of year. Our hopes are high, and we see the potential for an amazing year. That’s why I loved the quote about awareness. For some reason, in the dawn of the new year, there is an awareness of possibility that I don’t feel as keenly at any other time of year. It is certainly available to me any time but the start of something new brings a heightened sense of awareness.

You are in the right place to make that amazing year possible for yourself. Working On Your Now is all about putting purpose and possibility into your life, regardless of the area of your life that you want to work on.

So take some time today to cultivate your own awareness of what is truly important for you in this new year. Look at the various areas of your life and describe exactly what you want from each of them. Paint the big, bright, beautiful picture of how your life will be one year from now and then start taking little steps in that direction.

For your financial life, pick just one thing to make your overarching focus this year. What is one thing that you can do to alleviate fear, dread, anxiety or stress in this area? Become aware of that one area that needs your attention and then take the opportunity to make a choice to improve it.

The dreams are in your head; the truth is in your heart; the power is in your hands. Be aware, make a choice, and take action.

To your financial (and 2017) success!

Are you in danger of the Five Buck Syndrome?

I have talked about the “5 buck syndrome” before, many times. I have written about it and yet, this week, I did a lot of “5 bucking.” From app purchases to the shopping cart at the grocery store to online shopping’s lure of “only $10 more dollars until you qualify for free shipping,” the pull to separate us from that 5 bucks is strong. And yes, I fall prey to it as much as anyone so I write this to remind myself as much as to remind my readers that the phrase “it’s only 5 bucks” is the financial equivalent of a leaky faucet in your bathroom; it doesn’t seem like that little drip can add up to much until you plug the sink and see how fast it fills! You can build up to a $1,000 credit card balance, 5 bucks at time. The cash you had in your wallet on Friday night? It probably drained out 5 or 10 bucks at a time. Think to yourself how often that phrase runs through your mind, “it’s only X bucks.”

Here is a tip for saving that 5 or 10 bucks instead of spending it: keep an envelope in your purse or wallet that says, “it’s only” on the front. For one week, every time the thought, “it’s only x bucks” runs through your mind in relation to spending, put the money in that envelope rather than spending it. If you had planned to “swipe” for it, write the amount on the back of the envelope. Next time you are at Target, Walmart, or the grocery store, count how many the times you think, “it’s only,” as you look at an item and throw it into your cart. This time, put it back and write down that amount on your envelope. Every time. You will be surprised at how many times you discount the spending because the cost is low. You will be surprised at the dollar amount that adds up to in a week!

At the end of the week, move all the money to your savings account. You just created savings for yourself, 5 bucks at a time! Become aware of all those “5 buck moments” and pay attention. Don’t buy something just because it is inexpensive. Try to avoid buying at all! Ask yourself, “do I really need this?” Also start training yourself to recognize that phrase and stop before you just throw it into the cart, swipe your card, or click the buy button. You can get rich 5 bucks at a time; you just need to save that 5 bucks time and time again.

At holiday time, it is especially tempting to add volume to our gift-giving. More presents for the kids to unwrap, more stocking stuffers, more food around the table, more treats to take to the office. This year, treat yourself to that 5 bucks and rest assured that the gifts you’ve picked are enough; the food around the table is enough; and nobody needs more treats at the office!

To your financial (and holiday) success!

You Won’t Believe this! It’s FAFSA Time!

 

What? Isn’t that in January? Not anymore! For those of you with kids in college or about to be in college, this year is the first year of the timing change. Gone are the days of trying to cram in your tax return in January or make a guess as to the numbers in order to complete your FAFSA as early as possible. The Department of Ed is now using your 2015 tax return to calculate the income portion of your (and your child’s) expected family contribution (EFC) for the 2017-2018 school year.

That is right. The new form for the fall of 2017 school year is open. Many schools don’t even want or need it until January but you can be ahead of the game and do some planning to maximize your student financial aid. Here are some things to think about:

  • The income portion is based on the 2015 tax return so there is not much you can do about that but you can plan ahead for the following year.
    • For people who have their own businesses, you can do a lot to control the timing of income and expenses (within the tax code, of course!) so talk to your tax accountant about any moves you may want to make prior to year-end to minimize your taxable income. You are probably doing that anyway regardless of FAFSA, but it becomes doubly important if you are in the college season of parenthood.
  • You can use the FAFSA4caster right now, for a child of any age, to get an idea about what your EFC may be. It is very helpful to run through that now if this is your first time preparing the FAFSA.
    • Be sure to read carefully what is included and excluded in assets. Retirement accounts are not included for FAFSA but may be for the PROFILE form (used by private schools.) Read the guidance and be sure you are clear on what goes where.
  • Assets of both the student and the parent are assessed. There are tables for the parent to determine the assessment rate based on age, family size, etc. but the student assets are likely going to be assessed at up to 50%.
    • This is where timing is important. The assets you report are as of the day that you hit “submit.” That timing is important and it is under your control! (and so few things are at this stage of the game!)
      • Pay your bills, make your retirement plan contributions, make your tax deposits, etc. before you fill out the FAFSA. There is nothing wrong with putting yourself in a good spot before you fill that out.
      • If your child has saved money for a car or a laptop or other items, you may want to consider buying those items before you submit FAFSA.
    • Make sure you save your documentation for the numbers you use. The FAFSA system will pull directly from the tax system so you don’t have to do anything with respect to the income side but do document your whole balance sheet, where you got the numbers and what you are including on what lines of the FAFSA. That will help you in the event you are picked for verification and also will help you when you do this next year.
    • Be aware of your school’s deadlines and try to balance your need to plan and plot with the desire to be “first in line” for that money (if you may qualify for some). While everyone can get the regular loans, the subsidized loans, grants and other free money are not unlimited so earlier is better.
    • There are certified college planners out there so check the website if you want some professional help. (niccp.com) or contact me; I’m certified. This is best done when your child is starting high school but they can give you some tips and tricks even if you are further down the road.
    • Be sure you go to the real FAFSA (fafsa.ed.gov). There are a lot of look-alike services out there that will charge you to submit the FREE application for federal student aid form (FAFSA) so be careful when you are googling!
    • Even if you doubt that you will qualify for any financial aid, FAFSA is frequently the first step for the financial aid office even when getting merit scholarships so read your school’s financial aid/bursar site carefully to know what you need to do. This also is part of the process to get Hope or Zell in Georgia (although you can complete other forms as an alternative.)
    • Private schools may want both FAFSA and the PROFILE form so again, check the website for info so you are clear.

If you have a student in the throes of college apps, best of luck to you and to them. If you have someone coming up in high school, start doing some homework now. It is an adventure, albeit an expensive one, so take a deep breath and start clicking!

To your (and your student’s) financial success!

Tana

I’ve Been Irresponsible

I have heard that type of comment from clients or participants at speaking engagements but most recently it came from a friend telling me about divorce and the financial fallout in the aftermath. Yes, we’ve all been irresponsible at one time or another. We live in a culture that thrives on spending, living in the now, and has a focus on the material world. Yes, my friend, we have been irresponsible, our government has been irresponsible, our world has been irresponsible. And so it is.

So what have you been? What words do you use to describe yourself and your management of your own financial life? If it is more condemning than uplifting, then maybe it is time for a change in approach. When we berate ourselves (or others), we chip away at our confidence and our abilities. We undermine ourselves in the very area where we most need to be confident and self-assured. So the next time you beat yourself up, stop for a moment, and reframe your thoughts.

“I felt irresponsible/out of control/ashamed when I ________________________________. Next time, I can turn that around and feel responsible/in control/proud if I _____________________________.”

Focusing on what you can do, the way you want to act, or how you intend to face a situation that empowers you and sets you up to succeed. From today forward, drop the recriminations and focus on everything you want to be today and let go of what happened yesterday. We all can do better, be “more responsible” with our money, and turn our financial lives into something that we are proud of. Today is the day!

To your financial success!

The Graduate’s Guide to Money = Energy

Last time, I talked about thoughts becoming money. Of course, not every thought becomes money but we can’t get money without thoughts. I thought I would take an excerpt from my book to put it another way.

Excerpt from The Graduate’s Guide to Money
Money is energy, plain and simple. Humans had to create something tangible to represent their energy in order to make it easier to exchange.
Think about the cavemen days when there was no money or gold or anything at all to use as a medium of exchange. The cavemen bartered; one guy wanted something that the other guy had so either he clubbed him over the head and took it, or he started offering up things he owned which could be traded. Maybe somebody had meat and somebody else had berries. The two had to haggle to figure out how many berries would be equal to how much meat. At the very core of that exchange was the fact that one guy exerted effort to kill an animal to get the meat and the other guy exerted effort to pick all of those berries. There are other factors that enhance or detract from how much value is placed on that energy. Things like scarcity, access, and difficulty of obtaining will make the meat or the berries more or less attractive. Since each caveman was different, there was a different value placed on every exchange.

Fast forward a few hundred years, and the energy that was traded was more likely to be physical energy; the energy used to grow vegetables versus the energy used to milk cows. People traded sacks of flour for eggs or milk or a visit to the doctor. The doctor gave not only the energy of examining you but the stored energy of years of studying medicine.
So this isn’t some new-age “think about money and it will show up” philosophy. This is about turning your physical or mental labor into a paycheck. By working, you literally turn your energy—mental or physical—into money. The energy you give exactly equals the money that you earn, assuming, of course, that neither party is taking advantage of the other.

BTW: Volunteering works the same way as your paid labor, only you don’t get paid in money; you get paid with other energy, but that’s a different conversation.

End excerpt

When you think about the energy that you give and the money energy that you receive, is it a fair trade? I should also mention that we don’t always get 100% of our compensation in the form of money. Lots of people put a higher value on serving their fellow man than on financial rewards – all forms of public servants from teachers to stay-at-home parents to fire fighters and police officers and soldiers are not getting paychecks remotely close to the energy or value that they are giving. They are getting a form of energy worth more to them than money energy. Working with awesome people, being recognized, doing something meaningful or fun or invigorating are all part of the package. I guess the better question might be, is your energy equation in balance? Money is not the most important thing but being happy with your energy is. This week consider if your energy equation is in balance. If it is not, what steps are you going to take to bring it into balance?

Please visit www.graduatesguidetomoney.com to learn more!

To your financial (and energetic) success!

No One Will Ever Owe Me Money Again!

That’s right. I have vowed to no longer be the friendly ATM or the interim loan officer. I’m done. And here’s why: My experience has shown me that there are three types of borrowers.

Borrower #1 is the person who says they will pay you back and actually does.
Borrower #2 is the person who has the best intentions of paying you back, but runs into struggles along the way. However, they do pay…eventually.
Borrower #3 is the person who says they will pay you back, but they know they never will (and you learn a life lesson in the process).

After experiencing Borrower #2 and #3 once too many times, I have made some new rules:
Rule #1 When I have the money, and someone needs to borrow some, I will give what I can.
Rule #2 The money I give may not be the total sum the person is asking for. However, the amount will be more than what they have, and they can find someone else to borrow the remainder.
Rule #3 When I do give the money, I won’t expect it in return.

Why do I have these rules?

Because I have set the same expectations of others that I have placed on myself and it has driven me crazy. I’ve learned from my experiences that it is not fair to me, nor is it fair to others when I place the same set of standards on them, as I do on myself. I’ve learned that their values are not mine. The same high bar that I set for myself is just that — my bar. No one owes me anything. But, I owe myself everything. Whatever it takes for me to adjust my own attitude and my thoughts is what I will do to avoid getting myself annoyed at people who do not follow through on their word.

I have the power. I will not release it to someone else again, especially over money. They say money is power, but I say people are more powerful. What we tell ourselves about ourselves is power. How we choose to view things can give us power. How we choose to react to situations that annoy us gives us the power, as well. So here is the power I have given myself when it comes to someone borrowing from me. I choose to give and not to lend.
So, no more rants. No more complaints. No more aggravations. It’s simple. I expect nothing in return. And no one will ever owe me money again. I can live with that!

Whoops – Why Did I Do That?

Some mistakes involve doing things we wish we had not done. It happens, but if it happens and happens and happens again, it is probably time to take a closer look at what’s going on. Consider the following whoops areas and see if you fit one:

  • Heat of the moment – you know, at the concert – woo hoo! This is awesome – I’ll buy a shirt and a CD and one of those, and it’s a special night, how about another drink or dessert? If you are consistently caught up in the moment and Good Time Charlie has gotten away with your money again, you may want to make a plan ahead of time and take cash. When it’s gone, you are done.
  • It was a bad day – hate your job, fight with your ex, kids are driving you crazy and rather than “Calgon, take me away,” it’s amazon.com or the mall that takes your money away. Your brain is looking for a little feel good buzz and new shoes are just the ticket… until the bill comes and then regret is your middle name. If you are an emotional spender, admitting it is the first step. See that pattern and realize that you are looking for a distraction and something to make you feel better. A new gadget is not the best answer. Perhaps address the issue – get out some good paper and pencil and write down your feelings. Address the angst by analyzing the problem and coming up with some solutions. Get outside and get some exercise. Exercise is a better feel good medicine than all the shoes in the world and if you walk in nature, you have the added benefit of the restorative power of trees, birds and the wide open sky.
  • “If I only had ______, than _____” – oh, the lovely lies we tell ourselves! “If I only had a new laptop, then I could write that book.” “If I only had a bigger house, then I wouldn’t fight with my husband.” This is expensive if we go for it and a mirage if we don’t. This thinking is actually dis-empowering because we give the power to the shiny object rather than to our abilities to solve the problem. Reverse that thinking, “Even though I don’t have _______, how could I still _______?” This gets your creative juices going, takes back your power, and saves your wallet. No more regret when the laptop or the house was not the issue in the first place.
  • Fall for the “sale” – whether it is a sales guy preying on your fear of missing out or the banner in the store window, a sale on something you don’t need, is not worth falling for. Think back to all the things that you “had to have.” How many of them really became treasured items? Probably not many. Here is a great place for procrastination – wait until tomorrow and see if you really have a burning desire. You probably won’t.

These are just a few of the situations that cause us regret over actions taken. As you read through them, it may hit the nail on the head or it may remind you of other patterns unique to you. Regardless, identify the pattern, understand the trigger, and make a plan to fight back next time. Keep a journal of those regrets if you don’t immediately identify your pattern. The key to solving the problem is to recognize it and then you can focus on taking steps to avoid it in the future. In the meantime, forgive yourself and harness the power of that regret to take a new action which leads away from the pattern of regret and into the pattern of control over your responses. You’ll feel a whole lot better saying goodbye to regret.

To your financial success!

Money Mistakes

Last time I talked about the 4 steps to spring clean some of your mental money clutter. One of those steps is to forgive yourself and your spouse, if you have one, for past money mistakes. I also encouraged you to let go of the tendril of regret that accompanies mistakes. Easier said than done, right? Oh, my, regret has long, sticky tendrils that make detaching so tricky. Over the next couple of weeks, I want to talk about money mistakes, how to avoid them, and how to get beyond them when they (inevitably) happen.

Mistakes are a topic that I am an expert in! I have made loads of money mistakes and still have to regroup after I screw up and then think, “Why did I do that? I know better.” Try, try again.

So first – let’s define a money mistake as a money decision that is causing you regret. There can be other money mistakes – subtracting wrong in your checkbook, etc. that are technically not correct but are easily fixed and you move on quickly. For those other mistakes that cause you to cringe when you think of them, let’s exorcise the ghosts of mistakes past with this quick exercise (best done with a pencil and paper but even mentally is better than nothing):

  • What happened?
  • Why do you think that happened? (Here are a few ideas but definitely add your own: not paying attention closely, acting emotionally, ignored good advice, over-rode your own instincts, did not take action when you should have, did not face the truth of the situation)
  • What did you learn as a result of the mistake?
  • As you think back on mistakes you have made in the past, are they more likely due to taking a wrong action or due to inaction?

A mistake does not ever have to stay a mistake if you learn something from it – then it’s just tuition paid! As you think about your mistakes and what you can learn, pay very close attention to that last question. If you can group your past mistakes by “wrong action” and “inaction” what does that tell you? By honing in on your area of weakness or regret, you can better understand where you need to focus going forward so that you can avoid adding to the mistake list.

I will go into the two types of mistakes more deeply next week but during the week consider other areas of your life where you have made mistakes – is it from acting quickly or impulsively or is it from burying your head in the sand? You may see some patterns in other areas of your life. You are not necessarily all in one camp or the other so don’t feel that must pick one or the other but do see what patterns you can find. It is a thought-provoking question, though, so as you move through your week, give it some thought and let some of those past mistakes help guide you to a better financial future.

To your financial success!

4 Steps to Spring Clean Your Emotional Angst with Money

Let me start out today with a question: Did you take some action over this past week to get a new attitude? Did you reframe a fear into an empowerment statement? Did you decide to let go of some past missteps and create a plan to move forward toward your vision? If not, I’ve got some new action steps to help you get beyond some of the emotional and mental money clutter that may be holding you back or weighing you down.

 

  1. Tell the truth – to yourself and your spouse

Now is the time to ‘fess up and get it all out in the open. If there are bills and credit card balances, let’s pull out those statements, log in to those accounts, and face the truth. You can’t get to where you want to go if you don’t know where you are. Admitting to mistakes and short-comings is the first step to healing, redemption, and a new action plan.

  1.  Take responsibility for where you are

As you look at your savings accounts and your debts, you just have to own where you are and what the situation is. Even if the other person did the spending, you did the avoiding, the looking the other way or the abdicating of responsibility.  If you didn’t take an active role, at least monthly, in reviewing and monitoring spending, account balances and debt, you abdicated, avoided or denied.  You are still responsible for your inaction.  If you fell asleep in the backseat, don’t blame him that you woke up in Canada when you wanted to go to Mexico!  Wake up!  Look at the map!  Help navigate!

 

This applies even if you are single. You chose to look the other way when the statements came or when the savings didn’t happen. You chose not to actively make a plan for your financial life and you just “let it happen.” You got in the car and just started driving without a map or destination in mind. That was then, and now you are awake and alert and ready to…..

 

  1.  Forgive

Forgive yourself for mistakes, bad judgment, ignorance, apathy, spending, ignoring, avoiding, materialism, greediness, and other grave financial sins.  Forgive your spouse for all of the above.  To paraphrase Maya Angelo, when you know better, you do better. You may not have paid attention in the past but today is a new day! Now you are ready to turn it around and seize control. You cannot move forward if you are anchored to past mistakes, so LET IT GO!! Forgive and…

 

  1.  Change your perspective  

There is no more blaming – you and your spouse are one economic unit.  You both have equal responsibility for your financial health and well-being.  Instead of seeing your spouse as trying to control you, limit you, or take away from you, view your participation and “frugality” as a gift that you give to the person you love.  There is no greater gift than financial peace-of-mind whether you have a partner or not.  Everyone should be determined to chart their financial course, define their ideal financial life, and create a step-by-step plan to move toward that life.

 

View a spending plan as a framework for helping you get everything that you ever dreamed of and a way of eliminating all of the “trash and trinkets” that are taking away from your big dreams. Start seeing the shiny objects that are vying for your attention (and your money) as obstacles to what you truly want and create a plan to get those things out of your way so that you can focus on the big dreams – a home, travel, financial security – whatever the most important aspects of your life may be. Make a plan to fund the big goals, be willing to save for them, and have the determination to continue to move slowly, step-by-step, month-by-month, little-by-little toward them.
Then What?

These 4 steps are not “one and done.”  It’s not “paint the house;” pfew, that’s done for 5 years.  It’s the laundry; it’s done for today but tomorrow or the next day, sweaty, smelly clothes will reappear. You can’t avoid the truth, the responsibility, the forgiveness, or the change in perspective any more than you can ignore those nasty workout clothes.  If you do, you get the same result – a big smelly mess!

 

Understand that there will be mistakes and missteps so frequently tell the truth, accept responsibility, forgive, and think about the new perspective of embracing opportunities to save for the big, important things and push aside the little distracting things. Keep looking for those tips and tricks to save here and save there and keep revising, reviewing, and revisiting the plan. Old habits die hard so be gentle on yourself and your spouse and try, try again. Changing your financial reality is a process that happens over time. Changing behaviors, habits and attitudes is a process as well. If you keep at it, you will find yourself in a better financial situation with a new money attitude before you know it.

 

A New Attitude

In my last blog, I asked you to pay attention to your thoughts and especially your feelings as you interact with money and money matters. How you react emotionally has a huge impact on your ability to deal with money positively and create the type of calm, confident interaction with money and financial matters that I know you would like to have.

I recently had the pleasure of speaking to a group of sorority women at Georgia Tech. I always talk to students about their money story and how important it is for them to understand their money past so that they can create the kind of money future that they want to have. After the presentation, one of the women came up to me and said, “This is just what I needed to hear. I hate dealing with money and I guess I need to change that attitude!” Indeed!  When you hear someone say that, it is so clear that the energy being put out into the world is not likely to attract money and is not portraying a confident, empowered person! It is just so much harder to see that when the person doing the talking is you!

If you think about why she, or any of us, hates to deal with money, it’s probably because:

  • We don’t feel competent to make good decisions about our money, or
  • We don’t want to face up to our money situation, or
  • It brings up emotions that we just don’t want to feel (shame, fear, anxiety, conflict).

The cure for any of those things is action! Taking action is what moves us from incompetence to competence; it is what changes our money situation, and it is what can sweep away negative emotions by creating the positive association of action, progress, and growth. And action begins with a new attitude – “I just don’t know how” can become “I can’t wait to learn how!” “I’m broke” can become “I’ve got a plan to move to prosperity and debt freedom!” Fear, shame, anxiety and conflict can be converted to empowerment, pride, confidence, and serenity by learning from past mistakes, letting them go, and creating a plan to put in place new habits that move you toward financial peace of mind.

This week look at the ways that you may be “hating money,” avoiding financial topics, and swirling in emotion and see how you can take action to change your thoughts and create a new attitude toward your money. Pinpoint which of those areas applies to you and then get going on that attitude and dive into action.

Patti LaBelle rocked it when she sang:

I’m feelin’ good from my head to my shoes
Know where I’m goin’ and I know what to do
I tidied it up my point of view
I got a new attitude

Get your new money attitude, pick out your empowerment anthem, and start rocking your money story.

To your financial success!