Women in Business: Are you a Financial Innocent? April is Financial Literacy Month

April is Financial Literacy month – time to pull your head out of the sand and plunge into learning about your relationship with Money. Not just the numbers – how much you make or what you spend - butwhat goes on with your thinking and your feelings about money.

Inside you is the answer to why you keep repeating the same old money mistakes over and over again. Here are some money mistakes women make: Overspending, Not paying your bills on time even though you have the money, Financially enabling others and not taking care of yourself, or a big one for women in business; Not charging enough!!

You may be like I used to be: I hated thinking about money. But, I had an awakening when I went through the training to become a Certified Money Coach.*  I found out exactly why I had the challenges with money I’d had since young adulthood. Yes, it did have to do with the way my parents handled their money. Not their fault, their parents had influenced them as well, and I was still responsible for the choices I made. But once I connected the dots and became conscious, I was able to make better financial decisions and to create less stress and more financial peace. That’s huge!! .  (*Certified through Deborah Price & The Money Coaching Institute)  Next time: Find out What The Money Types Mean and how each type shows up in your Money Life.

Winning the Lottery: Financial Peace or Pain?

Imagine it. You've just WON the Super Lottery and now have more money than you ever dreamed of. But, does winning create financial peace or pain? For too many it's pain. Most people that win the lottery are broke or bankrupt within 5 years. That’s because winning a bunch of money and financial wisdom don’t necessarily go hand in hand. Winning is really a set-up because our training in how to manage money, grow and enjoy our money in healthy ways is so lacking in our families and our school systems.

I was making a deposit at the ATM Thursday March 29th and there was a big line of people buying tickets for the lottery. A few years ago I might have been in this line also. But since I’ve been trained as a Money Coach the “money fool within” is less likely to run the show and imagine I’ll beat the 175 million to 1 odds of winning.  

Yet, of course, people do win the lottery. I say good for them, IF they can quickly learn how to manage their instant wealth. Unfortunately, that doesn’t often happen. In fact “*…70% of all lottery winners squander away their winnings…” in less than 5 years. This is the same problem that NFL players are notorious for having. Most are broke a few years after leaving professional football.

Why is that? The simple explanation is that when someone’s networth takes a radical leap upward their self-worth doesn’t necessarily change as well. We all have a financial comfort zone we operate within. Too many people will get rid of new money in an unconscious way to stay in their old financial comfort zone. What I want for new lottery winners is for them to educate themselves immediately about what’s happened to other winners so they can avoid the heart-ache of financial destruction. The key to financial peace whether you’re a lottery winner or not, is to learn about your relationship with money, your money strengths and weaknesses and the hidden pieces that create money problems so that you can make the best financial choices.  (*Read referenced article here: http://tinyurl.com/88zfryt) To get started read Deborah Price's book: Money Magic or David Krueger's The Secret Language of Money.

Why Are Only 8% of Women Ready for Retirement?

Women control 51% of the wealth in America. I was shocked and pleased to hear that and yet many, many women I talk with aren't planning soon enough or saving anywhere enough for retirement. Instead what I observe is that women often don't want to think about retirement. And, while I understand, retirement going to be here sooner than we'd like to imagine.

Women are working very hard in their businesses, caring for their children, their families (including elderly parents). Who has the time to consider and plan how to make their money work for them?  When I'm coaching women in business I assess how much income they're earning, if they feel they're charging enough (often not), how their spending is, the amount of debt they are carrying and whether they have a 401(k) or other investment vehicle. 

Here are three things women need to do. And remember: "A man is not an retirement plan."Deborah Price, Money Magic

1) Just Start an investment account. The earlier the better. "For the first time, women in the work force full time are just as likely to have access to a 401(k) as men and their participation rate is as high as we've seen." Catherine Collinson, president, Transamerica Center for Retirement Studies. (Modesto Bee 2-5-2012)

2) Know what you'll need to replace your income in retirement and maintain your lifestye. Google retirement calculator, pick one and plug in social security, other income and expenses. This exercise is not as fun as going shopping, but when you're 75 and either don't want to work or are unable to, all those shoes or beauty products you're buying today aren't going to keep you warm or add to your income. But the $50.00 a automatically deducted each and every month can and will.

3) Take more risks. Women don't often take investment risks. I'm financially conservative myself, yet we want our money to work as hard for us as we've worked to obtain it. Women still only earn 78 cents on the dollar compared to men. We take time off to have children or caretake others. The really savvy women I know do take calculated risks. One of my friends has been a real estate investor for 30 years and built quite a retirement fund for herself. Here's to you taking charge of your money today so it works for you tomorrow!!

Widow Alert: A Man Is Not a Retirement Plan & Social Security is No Savior!

My coach and mentor Deborah Price of The Money Coaching Institute in Petaluma, CA says that most widows are out of money within 5 years. Whew!! Frightening. She also says: "A Man is not a retirement plan." As a Money Coach I talk to women every day who avoid the topic of retirement, or the subject of money in general. I understand, I used to be one of those women!!

But life can provide rude awakenings so please read on and I'll share a true story with you:  I was at a party and got to talking to a woman about money because she asked me what I do. Glenda (name changed) told me that she’s now 75. When she was 59 her husband died unexpectedly at 66. She called Social Security to find out about her benefits as she assumed she would receive 70% of his monthly amount and was shocked to find out that for each month she was NOT 65 Social Security deducted ½% of his total. She ended up receiving 40%, a very different amount than she had planned on or needed to live the comfortable lifestyle they had together. (Note: I've since talked to a really sharp financial advisor and she's investigating whether it's possible for her to now change and take her own SS benefits over her husbands).

I have a friend who just lost her husband, again unexpectedly. He was 72 and she’s 47. They have no children so she will only receive a $250.00 death benefit and has no right to any of his social security. I know he thought she’d be fine when he went. But, she no longer has his income which amounted to most of their monthly income.

The moral of these stories?  Know what Social Security will and will not provide, make sure you have life insurance, (my 47 year old friends husband did not) and have a financial advisor calculate out the amount of money you will need per month to maintain at least 75% of your income. Start an automatic savings program and find a good financial advisor in your area. Ask around and if you're a woman in business try to find a good female adviser. Losing a husband is a huge loss and financial problems complicate everything. Start thinking about and planning not only the IDEAL retirement, but for the worse-case scenarios and you'll be ok financially.