Here’s what you probably know: I am slightly obsessed with getting you to embrace the idea that financial success isn’t just about the dollars and cents. It’s a message that is imbued in everything I do!
What you probably don’t know is the back-story of my obsession.
On October 19, 1987, the stock market crashed. I was still a newbie and green behind the ears, just a year out of undergrad working at an investment bank. I can still vividly recall the frenzy of that day as if it were yesterday. Some people were absolutely beside themselves, freaking out. While others were moving about in a rattled, but calm, way. I was completely fascinated by this disparity…
This is when I really fell in love with Wall Street. This is the day that planted the seed for my ongoing quest to discover the dynamic relationship you and I have with money. Questions like – What role do emotions and psychology play in how you make financial decisions? and How do the consequences of your past money decisions impact your future decisions? – became an integral part of my working parlance and framework.
Clearly, I’m not the only beset with this fascination of human behavior and money. There’s an entire academic field of study (behaviorial economics or behaviorial finance) dedicated it; there’s even an index for measuring how you feel about your money and the economy – The University of Michigan Consumer Sentiment Index.
If that isn’t enough, there’s a study by the Carnegie Institute of Technology, which found that “85% of your financial success is due to your personality and ability to communicate, negotiate, and lead. Shockingly, only 15% is due to technical knowledge.”
And yet, when it comes to meeting your money goals and addressing your financial challenges, what’s the first thing you typically do?
If you’re like most people, you aim to increase your technical knowledge – rationalizing that if you learn a particular how-to all will be fine.
The problem with most how-tos is that they tend to be far too generic to be of much value.
Create a budget. Spend less than you earn. Get out of debt. In other words, blah, blah, blah…
When a how-to doesn’t work the way you envisioned (or how it promised), you don’t question the how-to or your approach, you search for another one – hoping that THAT will be the answer you sorely seek.
Aren’t you tired of the roller coaster?
I know I am tired of it for you because I know there’s a better way.
I SO want you to be in the 85% club. I want you to value your personality, distinct way of communicating, negotiating and leading; I want you to see what makes you you as an asset to the way in which you manage your money – not as a liability.
Can you imagine what it would look and feel like for you if you framed each and every financial choice through the lens of your money strengths, money style, and money personality?
I think it’d be pretty hot!
And, I believe if you made the choice to focus on being in the 85% club, you’d have more control over how money impacted your life. You’d meet your money goals with more ease than ever before. How you experience money would be drastically different…and it certainly wouldn’t be boring!
You can work on being in the 85% club on your own. Or, we can chat and explore the possibility of working together. You can tap into my insight and get my directed but unbiased advice tailored to you and your money. Click here to schedule a complimentary Office Hour meeting.
p.s. If you are in Brooklyn, NY, come to the Brooklyn Public Library (at Grand Army Plaza) tomorrow – Saturday, April 18th. I’m the keynote speaker kicking off the library’s Financial Empowerment Fair. I speak at 11:30am and would be oh so thrilled to see/meet you!! Open to all; no RSVP required.
Where do you spend more mental energy: focusing on your money faults or your money strengths?
That is the question I posed on LinkedIn, Twitter and Facebook. And guess what? Not one person said, “I focus on my money strengths.” Not. one.
Lately, I’ve been fascinated with our cultural tendency to focus on our weaknesses. So, I’ve been paying a little more attention to the choices you and I make and the “whys” behind those choices.
Specifically, I’m curious to know: Is the motivation to fix a weakness or strengthen a strength?
Yes, we each are good at some things and not so much at others. Yet as another one of my unscientific research exercises proves, you and I tend to err on the side of being preoccupied with our faults. Heck, people invest a lot of time perfecting the answer to – “What are your weaknesses?” – the penultimate litmus test for HR and hiring managers. And a lot of money is spent in hopes of fixing what is wrong with us.
This despite a growing body of research from scientists at the Gallup organization and research from strengths-advocate, Marcus Buckingham, which suggests it’s far easier to reach your goals when you focus on improving your strengths.
According to the book, Strengths Based Leadership, by Tom Rath and Barry Conchie, “the most effective leaders are always investing in strengths.”
Naturally, I began to wonder if the same applied when it came to your money.
Would your financial results improve if you focused more on what you do well when it comes to your money and less on what you do wrong with it?
Are the most financially successful that way because while they are aware of their financial weaknesses, they don’t invest a great deal of energy trying to turn those faults into a financial strength?
If an unhealthy preoccupation with your weaknesses doesn’t propel you to success when it comes to your career, it seems logical then that the same relational dynamic would apply to your money, right?
Stay tuned because this is something I’m going to continue to explore.
But in the meantime, I thought it’d be fun (yes, fun!) to apply the good ole SWOT analysis technique to your money. It is a tool you can utilize to jump start the habit of strengthening your strengths. If you are unfamiliar, SWOT analysis is a framework typically used by businesses to assess the viability of a project or new business venture. Spelled out, the acronym means…
“S” = Strengths
“W” = Weaknesses
“O” = Opportunities
“T” = Threats
This one-pager is a useful financial planning tool, too. It can quickly give you an overview of your financial situation.
As a lover of graphics, I prefer to do my SWOT like this: a) draw a rectangle, b) divide the inside into four sections by drawing a vertical line and horizontal line, c) label the upper left quadrant “Strengths;” the upper right “Weaknesses;” the lower right “Threats;” and the lower left “Opportunities.”
You can brainstorm questions for each section other than what is noted below, but these will help you get started…
- what are your good money habits
- what money and money-based choices make you feel most proud
- are you operating at a profit (meaning your income exceeds your expenses)
- are you saving consistently each month and if you have investments, do you know what you own
- do you have a low debt:equity ratio (excluding your mortgage)
- what are your “poor” money habits (just because you shouldn’t focus on what you do wrong with money doesn’t mean your head should be in the sand…)
- what’s causing you to stress out about money
- if you don’t have at least six- to nine-months of living expenses saved
- if you aren’t investing in a retirement account (and if it’s employer-sponsored, if you aren’t contributing at least up to the matching percentage)
- if you don’t have a Will, Health Proxy, insurance and other estate planning documents
- what career plans are on the horizon in the next 12-24 months
- what would it take to increase your salary (or business revenue) between 10-15% in the next twelve months
- how would refinancing your mortgage, if you have one, affect your cashflow and what would you do with those funds
- when did you last request a decrease in your APR if you’re carrying credit card debt
- do you have investments, but don’t have an investment strategy
- do you have mounting debt but not viable exit strategy
- what would happen if you lost your job or most lucrative client within the next twelve months
- how prepared are you for the next bear market and the ripple effect it may have on your career and financial stability + security
By doing a SWOT analysis on your financial life, you are able to increase your self-awareness and get in touch with your money faults AND your money strengths. But, instead of spinning your wheels improving your weaknesses (which drains you of vital energy), you can redirect your efforts to improving your strengths. And I bet you’ll have a better financial life!
Tomorrow (Sunday) morning, I will be on HOT 97FM with host, Lisa Evers, and others talking about money.
On Tuesday, I have one of the coolest speaking gigs to-date for a major insurance company.
On Wednesday, I’m hosting the first Financial Intimacy Hour segment of 2015.
Each of these are examples of the Relationship Economy at work in my life.
What are recent examples at work in yours?
Your examples and mine are reminders that not only is business done between people, but business comes through people.
It’s no mystery that you and I don’t achieve success on our efforts alone. After all, we know success is all about relationships.
The mystery is the fact that you rarely know who holds the key to what’s next for you – who will be that person to unlock the door that makes room for your next opportunity be it promotion, job, client or something else you desire!
It’s a mystery that some (maybe even you) don’t manage well. In part, because you’ve fallen for the myth. The myth that says the key to growth and advancement is “keep your head down” and work – and don’t forget to work hard, too. And so you do and you end up working harder on the work than you do on what leads to the work in the first place.
The other reason is that embracing the mystery feels a little bit like leaving too much to chance, which is totally counter to your nature to want to be in control.
Even though you may feel stagnant in your career or business, you either network ineffectively or with a “me-focused” mentality. Or, just as unfortunate, you only network when you need something – like a new job or new client.
You confuse having an extensive contact list or thousands of friends on Facebook or many followers on Twitter or 500+ connections on LinkedIn as having cultivated relationships with all these people.
You don’t recognize your emotional intelligence as the intangible currency that can help you connect to the human being beneath the persona we all have.
Yes, relationships have been the cornerstone of business since, well, forever. But in the new economy of the 21st century when even employees are a “brand,” relationship management skills aren’t a nice-to-have. They are required.
How well you manage the relationships in your life are your personal currency. Because…
…rarely are you in the room (or at the table) when important decisions about YOU are being made.
So when you don’t manage the mystery of relationships well, you miss out on the inside-scoop; you don’t have someone advocating for you over other options; and you potentially elongate your path to even greater success.
When you don’t manage the mystery of relationships, you end up sacrificing the very key to your success!
On the other hand, when you tap into the mystery of relationships:
- You realize that having a relationship-building strategy isn’t sleazy and manipulative. When done with a “win-win” intent, it’s smart.
- You learn how to genuinely build rapport and trust while being sensitive to other people’s boundaries AND without stretching yourself too thin.
- You realize that sometimes your best opportunities actually come through people who aren’t the closest to you. Ironic, right?
Relationship building is both art + science. It’s also a skill.
If you’d like to refine your relationship management skills…
If you’d like more success at work…
If you’d like to experience deeper personal connections at home (because what creates a great business life can also create a great personal life)…
I invite you to this month’s Financial Intimacy Hour this coming Wednesday, 25 February at 8pm ET. My guest, Michelle Y. Talbert, Esq. will share how to use curiosity, the art of conversation, and the skill of making connections to experience more success at work and more meaning at home.
Hope you can join us! Click here to register; it’s FREE.
p.s. if you can, tune into HOT 97FM at 9am on Sunday, February 22nd! Click here to stream the station from your computer.
It’s here! That time of year when you and I are inundated with messages about how to make this year our best year yet. According to the University of Scranton-Journal of Clinical Psychology, 45% of Americans will do this by making New Years resolutions.
Some will tell you that making resolutions is the key to your transformation; others will tell you resolutions are hogwash and instead you should focus on goals.
At the end of the day, I think it boils down to semantics. You can call it making resolutions or goal-setting – either way, both reflect that there is something about your current reality or experience that you want to change.
With all the emphasis on the actions you need to take to achieve your resolution or goal (i.e., avoid junk food; exercise more; spend less; save more; etc.), which indeed is important, I wish more people focused on the mindset needed to change their reality.
To truly succeed at keeping your resolutions or with meeting your goals, you need to change your mind, too!
Do you know why? Because most of the obstacles you’ll face as you work on your resolution or goal are internal…not external.
I encountered this this morning. One of my personal goals for 2015 is to run four (4) half-marathons. The first one I’m targeting is March 15th, not that far away. So that means I need to run! But I run outside, and when I saw the air temperature was 16 degrees with the wind chill making it even colder, I was NOT too enthusiastic about today’s run and almost talked myself out of it.
But I reminded myself that while I can’t control the weather, I can choose how many layers to put on. Plus, I play this game with myself where, daily, I can ask, “If I do nothing else today, what would make me feel successful – like I accomplished something?” Whatever that is, I do. Today, that was running regardless of how cold it is.
So, a full week into 2015, if you need help with your resolutions or goals, consider this:
- It’s not enough to have a plan. You’ll be better served if your plan addresses not just the actions you need to take, but also the mindset you need to have to keep your resolutions or meet your goals.
- Think about your resolutions/goals through the prism of the habits or rituals you need to foster to set yourself up for success, as well as those you need to discontinue.
- Don’t just focus on the large, sweeping resolution/goal you have. Also visualize the smaller ones that need to happen along the way that ultimately make the big one possible. (For example, today’s 3.3 mile run helps me get ready for March’s 13.2 mile run.)
- Go beyond the surface reason for your resolution/goal. Invest the time to tap into the real motivation; here’s a good time to ask, “What else?“
- Write down (preferably on paper) the one thing you can do daily and weekly to set yourself up for success.
- Then, write down what you’ll do to re-group when you falter. (ALERT! We all falter from time to time. Having a lapse or relapse isn’t the issue – it’s what you do to get back into the groove that matters.)
- Know the tools and the people you’ll need to support you…and then diligently use them!
In truth, this time of year really isn’t that different than any other month or day. It’s just that it is a universal marker for us all to collectively start over or do something we’ve never done before – together.
So whether you prefer to make resolutions or make goals, I wish you the happiest, healthiest, and most successful year to date. I hope your challenges and disappointments are not too great. And, I hope your good experiences surpass your wildest dreams and expectations.
Happy, Happy New Year!
One of the most powerful personal finance tools you have at your disposal isn’t a spending or investment app. Or, a spreadsheet. It isn’t your income statement or balance sheet, either. It’s a question.
Preferably one that begins with the word – “What?”
I have long known this. It’s one of the reasons you hear me tout the importance of insight over information; it’s why I say let the “activity” of inquiry guide the actions you take.
But last week’s Financial Intimacy Hour provided even more proof! My guest, Heidi Johnson, and I had a vibrant conversation about the ways in which curiosity can improve your career, life and money decisions. (click here to grab the replay.)
When I asked Heidi what one thing would she recommend for living more curiously in 2015, she responded: “…ask ‘What Else?'”
I plan to. You might want to give it a try, as well.
This time of the year gets crazy. And not just because it’s the holiday season. But because it is also when the usual year-end review and new year goal-setting kicks in. In between the holiday gatherings and gift shopping, you’re most likely reflecting on this year’s goals and dreams, and claiming how you want 2015 to be different (better, perhaps?).
And if you are like many of my clients before we start to work together, ALL of this is happening in your head!!
The “busyness” of the season prevents you from slowing down long enough to get out on paper where you are versus where you thought you’d be, along with where you still want to be.
I know you are smart, but you need to get out of your head! Especially if experiencing more success (however you define that) is one of your aims.
Make 2015 the Year of “What Else?”
Asking, “What else?” can help.
Specifically, it can stop you from only:
- doing your year-end assessment, mentally
- declaring your goals and dreams, vocally
- affirming what you want to change, vocally
The benefits of asking “what else?” are many:
It sets you up to review the past and plan for your future – without judgment.
It gives you an opportunity to dig deeper to ensure you go beyond the surface (aka the obvious).
And when those urges to lay out a how-to plan surface, it will help you table that temptation until a more appropriate time when such a step will actually have some value.
Imagine if your every desire for 2015 came true – what would accomplishing your goals look like; how would it feel to achieve your dreams; what habits and choices do you envision needing to make?
Asking “What else?” will help you navigate and negotiate the space between your current reality and the one you desire to create. It will ensure you are both strategic and tactical – at just the right times and in the right way.
For me, one of the ways I am using the “What else?” question is to help me uncover the questions I didn’t ask (looking back) or haven’t yet (looking forward).
So as you begin to wind down 2014 and welcome 2015, take ten minutes each day to ask “What else?” Ask it when looking at the various dimensions of your money (earn, save, invest, and spend) and dimensions of your life (family&friends, professional, finances, values/spiritual), and how these all intersect.
As I told a journalist who interviewed me recently, sometimes the action you need to take is to ask a question.
Questions help you get out of your head. They help you shift from over-emphasizing knowing-how to understanding “knowing why.” Remember, your emotions drive your money decisions. Finally, questions – especially “what” inspired ones – truly are your most powerful tool for getting money to do what you want it to do for you. So…ask ‘em and do it often!
Perhaps you can relate: You experience something traumatic. It’s followed by a strong desire to change something you can control – to offset the change you couldn’t. If you’ve ever experienced this, then you’ll understand my deep desire for a little home makeover.
With the help of a dear friend, when I welcomed guests into my home to continue the Thanksgiving tradition of my mother’s and mine, my home had a new look – courtesy of a few additional pieces of furniture and accoutrements and some furniture rearranging. With small tweaks, my home was transformed. Toni helped me reconfigure (and re-envision) my space. In the process, she did for me concerning my home what I do for my clients concerning their finances: find the unfamiliar in the familiar.
And I was like a giddy child on Christmas Eve.
A perfect feeling given that the holiday season is now upon us and officially in high-gear.
For you and for me, the childlike wonder of the season doesn’t just have to be confined to this time of year. It can be a constant state of mind…a standard way of approaching decisions about your career, life and money.
However, that requires that you intentionally practice curiosity to:
- Answer a pressing or recurring question
- Resolve a conflict you’re experiencing
- Address a nagging contradiction of expectations and/or beliefs
- Ease your discomfort
- Close the gap between what you do know and what you don’t know
- Discover the gap between what you’re seeing and noticing
But, how often do you do that? Can you count the number of times lately when you preceded a decision or action with a statement that began with, “I wonder if…or I wonder what would…”
This sort of inquiry is why most of us use smartphones.
This sort of inquiry is why you can stream music, movies and TV shows in your home and on the go.
This sort of inquiry is why there are financial apps that can help you monitor your spending and manage your wealth in ways unforeseen just five years ago.
Curiosity alters your reality.
If I may be so bold, I’m going to venture to say you’re not being curious enough – you’re not engaging with life with childlike wonder.
It’s not that you don’t have an inquiring mind. After all, you were born with it. After all, it’s likely what is behind many of your accomplishments. But, I suspect, you’re not exercising the power of curiosity as often as you could.
The way I see it, here’s the underlying problem: for far too many adults, the obligations of adulthood can make what is innate (curiosity) become a dulled emotion. You’re constantly moving from task to task and decision to decision that you rarely pause long enough to take notice of what you’re seeing.
As a result, you become satisfied with surface questions, answers, outcomes and justifications.
As a result, you tend to value what you do know more than the surprises of what you don’t know.
As a result, your expectations and assumptions don’t evolve.
And this happens all because going deeper seems too involved – it requires too much time and effort.
Finding the New in the Same
I have been in my apartment for twenty-two years. So, I am quite familiar with my space. And, quite honestly, I was in a visual rut. Metaphorically, I was not applying the same talent, skills and intellectual vigor when it comes to my work as a financial behaviorist to my living environment. Yet, angling the couch in a different way; switching a painting from my bedroom to the living room; adding a few floor and table-top lamps; and taking more advantage of my 10′ ceilings, to name a few, makes the same look new.
“Curiosity is making the choice to look deeper into everyday things and seeing their true significance.”
The end of the year and the holiday season are perfect times to seek and discover the unfamiliar in the familiar.
It’ll help you engage with family, friends and colleagues differently – with more openness – during gatherings.
It’ll help you take stock of the year that is coming to a close with a little more compassion.
It’ll help you look at what’s happening with your money with fresh new eyes.
It’ll help you plan and prepare for a new year with a bit more energy and excitement.
If you knew there were questions (or themes) and small tweaks that could help you practice curiosity with more intention, would you be interested in learning about them? What if the same will also help you to make better decisions concerning your career, life and money? If yes (!), then join Heidi Johnson and me for the final Financial Intimacy Hour of 2014!
On Wednesday, 10 December at 8pm EST, we’re having a conversation about the role of curiosity and its impact on your career, choices and financial success. Click here to learn more and to register.
In preparation for the upcoming Thanksgiving holiday, I purchased an indoor electric turkey fryer! (Quite excited!) I purchased it this weekend from Amazon and got a great deal because of their “Countdown to BlackFriday” sale.
Several times throughout the checkout process, I was “invited” to become an Amazon Prime Member. For a split second, I considered it. But after a quick mental audit of how often I order from Amazon, I couldn’t rationalize the $99 annual fee.
The fee made me think of what one client recently said to me:
“I want money to stop slipping through my hands…”
It’s a sentiment I hear often; it is what can so easily happen in our subscription-services economy; and it is precisely what spending $99 on Amazon Prime would have felt like for me.
And it was exactly how I was feeling as I mentally reviewed certain other on-going subscription based fees I incur – whether they are charged annually or monthly.
Perhaps the charge is nominal so you rationalize it by saying, “oh, it’s only $5.99 a month…”
Or maybe you say, “well, if I use the service once or twice, then the annual subscription has paid for itself…”
Or worse yet, maybe you don’t even realize you’re paying for a product/service each month. This happened to a friend of mine; she finished her doctoral thesis six years ago yet she recently realized she was still paying for subscriptions related to her research work that is now complete. To the tune of 320 Euro a year or $400 a year…for six years!!! You do the math.
Subscription services – the “new” new way to consume and buy
Subscription services aka the subscription economy isn’t new. Magazines have been doing it for decades. But today, this model is popping up in all sorts of industries. Including personal finance! Case in point: LearnVest, or a little closer to home…the Financial Intimacy Lounge – a not so subtle plug -:).
In fact, John Warrilow, author of the forthcoming book, “The Automatic Customer: Creating a Subscription Business in Any Industry,” said at Inc. Magazine’s GrowCo conference: “…[subscription businesses] provide the greatest value to both the [business] and the customer.”
[business] and the customer.”
When I think of value, I think of it as expressed in terms of uniqueness, convenience, variety, simplicity, flexibility, affordability and, well, a changing value system with regards to how consumers behave in almost every aspect of life.
I also think of value as expressed in terms of a continuing relationship.
And just like all on-going relationships, when you get lazy about ‘em and don’t pay attention to what is and what isn’t working, well, you know… Someone is really happy and the other one ends up quite unsatisfied.
Don’t be unsatisfied
As we near the end of the year (can you believe it?), now is actually a good time to ask yourself if you are stuck in a recurring payment trap with some of the subscription service/s you use. In other words, is what you are buying and consuming via your subscription giving you the value you want. Or, is it the cause of money slipping through your hands, too?
Maybe the monthly or annual amount isn’t “a lot” in the grand scheme of things. But the financial detox exercise I’m about to propose is less about dollars and cents in the absolute sense. Instead, it’s about being “conscious and intentional” about what you’re choosing to do with your money and whether those funds could be (re)directed to something else that has more value to and for you – whether you measure that based on pleasure or utility.
So here goes:
- Grab your banking and credit card statements for the last three months. If you receive statements electronically, please print them out. (You can always recycle the paper.)
- Review those statements and highlight your recurring expenses. Choose one color for monthly expenses and another for annual ones.
- On a separate sheet of paper (or in a spreadsheet), list the recurring expenses and rank them according to three categories: pleasure; utility; waste of money.
When I did this piece of the exercise, I chose to keep Netflix – even though I don’t use it often. It’s nominal and I like the “option” of having it. Yet, I chose not to renew my ZipCar membership. I’ve rented a lot of cars in the last two years – not one of them was a ZipCar!
- In this same spreadsheet, sum up each category…you just might be shocked at what you discover. In addition to evaluating the total financial outlay, look to see if your automatic withdrawals are spread throughout the month. This will help manage your cashflow and ensure you’re not lopsided leaning more toward the beginning or end the month.
- Make an assessment of each line item.
Anything you deem to be a waste of money, get rid of immediately. Or, downgrade your plan (if that’s an option). Before I sat down to pen this, I did that with a business expense. I’m not quite ready to get rid of the service completely, but I’m also not using all the features of the pro plan, and I’ve decided to stop spending money based on the “maybe, one-day I will thinking.”
- If possible and appropriate, migrate the monthly or annual withdrawals for your recurring expenses to one banking or credit card account for easy tracking.
The beauty of subscription services is that they are really all about YOU. It’s about access the way you want, how you want it, and when you want it. Fundamentally, it’s about choice – your choice. And, with choice comes control.
You are in control.
Don’t abdicate that control by paying recurring fees for products/services you no longer find pleasure in or that have outlived their utility. Because, sadly, some businesses are counting on you to trivialize a “small” dollar amount. Or, for you to be so busy living your life that you completely forget about what you committed to.
If you find money slipping through your hands, at least don’t let it be with regards to subscription services.
p.s. I’m so excited to be a guest speaker in Bari Tessler Linden’s The Art of Money Symposium on enTheos.com – joining some other cool peeps like Barbara Stanny, Mindy Crary and many others. Check us out here: https://www.entheos.com/The-Art-of-Money
I read somewhere that if you could achieve your financial goals by simply putting your money away in the bank you wouldn’t need a plan.
That’s silly to me. That’s like saying as long as you have gas in a car you don’t need directions to drive to a place you’ve never been to before.
Yet, this way of thinking represents a common mindset when it comes to managing money and preparing a financial plan. And, in my opinion, it is why so many people don’t get as much as they could from their money.
Today is the last day of Financial Planning Week – the 13th Annual one no less! Granted, this factoid may not make your heart stir and go pitter-patter. But, I thought today would be as good a time as any to share what I believe financial planning is really all about. I suspect if more people adopted this perspective, more people would get excited about preparing and editing a financial plan. Imagine that!
Besides b.o.r.i.n.g., what usually comes to mind when you hear or read the words “financial planning?”
In no particular order, I bet you think about some if not all of what’s listed below:
- Your lifestyle
- Your career and current & future earnings
- Children and their education
- Parents and their well-being
- Your own well-being
You may even wonder if and at what point the help of a financial professional makes sense.
I also bet for each of the above bullet-points (and others I may have overlooked), your focus has been on the numbers – the numbers you know and the numbers you forecast. It all comes back to the numbers because the presence or absence of money is what typically drives your decisions.
Financial Planning: The Movie?
But what if instead of looking at financial planning as an exercise in making the numbers work, you thought of financial planning as the telling of a story through a collection of vignettes? Vignettes that when woven together resemble a long-format television series, with many seasons, about your life – the one you have and the one you want.
Not only are you the star of the series, but you also play the role of producer, writer and director. And you become a quadruple threat for the small screen the likes of George Clooney for the big screen. Much more exciting, right?!
You may be rolling your eyes right about now. But hear me out…
There are a number of benefits to viewing financial planning through the lens of making a critically-acclaimed and successful series. To start, you begin to recognize that even if everyone follows the exact same steps (think of all the long- format shows on HBO), the results won’t be precisely the same.
Thus, the reason I say financial planning isn’t supposed to mean the same thing to everyone.
By thinking “story” over the numbers, you’re invited to connect the dots that represent the pieces of your life in a more profound way. The result: You have to bridge the gap between your vision for the future and your present-day reality and consider the tools, resources, and people that will help you close the gap between here and there. That includes:
- Using money as a tool, but not the only tool!
- Remembering that emotions are not black-n-white. And neither are numbers. True, the numbers may be negative or positive, but the “story” behind the numbers is rarely as black-n-white as you might think (or wish).
- Viewing financial planning as less about planning for retirement and more about planning out your entire lifestyle cycle (the on you have, the one you want, and the one that will help you bridge the gap).
- Embracing ambiguity and the practice of scenario planning via story-boarding.
- Using scenario planning to help you identify the likely obstacles you’ll encounter and manage the ones you’ll actually face.
- Learning to objectively observe your patterns, habits, and anomalies.
- Learning to objectively see the relationship you have with money, and how and where you need to work on it.
- Remembering you never do it alone.
There’s a term in the film industry called the “cutting room floor.” It pertains to what’s been omitted from the final footage. The way I connect this to financial planning is how the results you see reflects a lot of the intangible choices and decisions you’ve made but others can’t “see.”
If you’re like most people I know and clients (before they became clients), you’re really much more interested in being with family and friends; focusing on your career; and enjoying your leisure time and a lot less interested in managing your money and creating a financial plan. As a result, you either don’t have a plan or you have a one that was haphazardly put together and may not be current.
However, when you don’t have a plan (or a current one), you don’t know what you need to do consistently and you don’t know when and where you need to evolve in order to achieve your financial goals.
So, in honor of financial planning week, I ask: do you have a viable and or current financial plan? If not, what are you waiting for? And, how might thinking of it as a tool for making a critically-acclaimed and successful long-running series about your life help you get started?
On this beautiful Saturday afternoon, you and your friends may not be lounging about, sipping a cool, refreshing beverage and talking about “identities” and “emotional intelligence” and “financial intimacy.” But the truth is every financial and career choice you make is a reflection of how you see yourself and your degree of self-awareness.
So is how you define and experience the American Dream.
If you were with us on Wednesday for the in-person presentation of this month’s Financial Intimacy Hour, you know we had a phenomenal time. If you weren’t and you’re curious about what you missed, click here to grab the replay.
Leading up to the “American Dream? Rethinking Race, Gender and Financial Success,” I wrote several posts talking about trends impacting our economic and employment landscapes. Trends that will certainly affect you and your livelihood if they haven’t already.
- I shared stats like 4.4 years; 42 million people; $12 trillion; and the “browning” of America. Combined, these data points tell an intriguing story about where we are in our cultural, economic, and employment history.
- I talked about why bridging emotional intelligence and financial intimacy is a must-have if you want to effectively and proactively manage your career and your finances.
What I didn’t reveal here as clearly as I did that night was why I felt this conversation was an important one to have – right now.
As you probably know, I am an observer. Noticing patterns that others miss or discount is one of my strengths.
And a pattern that caught my attention can be summed up with these five words, “When things get back to…”
It feels like I’m hearing this sentiment more and more, especially from some clients and prospects who lost a job, significant money, or both as a result of the 2008 crash and the Great Recession that followed. And…they still haven’t recovered (or not as completely as they’d hoped.)
Their longing to get back to the way things were is deep. Understandably, yet still unfortunate, the desire to get back to the comfort and safety they once felt is so strong, they are missing the signals that indicate a new reality has formed, a new normal is afoot.
They are stuck in a time warp and not adjusting too well – emotionally, psychically or financially.
As someone shared with me, the aftermath of 2008 felt like a game of “musical chairs and when the music stopped I didn’t have a place to sit.”
What a perfect metaphor for what so many (perhaps even you?) are experiencing. If you ever played musical chairs, you know it sucks when the music stops, the seats are all gone and there’s no room for you in the circle. And this is precisely why I wanted to talk about the American Dream in the context of race, gender and financial success.
I wanted to explore how the above-mentioned trends reflect your identity through the prism of your personal finances and the American Dream. Especially if you feel slightly uprooted.
How do you see yourself; how do you want others to see you; and how does the reality of where you are today relative to where you’d thought you’d be compare? If the mirror is reflecting back anything other than what excites you and has you wishing things were as they used to be, click here to grab the replay of “American Dream? Rethinking Race, Gender and Financial Success.”
My conversation with Dr. Atira Charles will not only increase your emotional and financial self-awareness, but you’ll also have specifics steps to help you shift from longing for how things were to being excited about what is and can be. And because the principles we share are universal, you’ll get something from this even if what has you feeling a bit nostalgic has absolutely nothing to do with money or your career.
Enjoy…and then let me know of a major takeaway!
I’m gearing up for tonight’s Financial Intimacy Hour with my guest Lori Anne Douglass, Esq. We’re tackling that topic I talked about last week – the one most would prefer to avoid.
I addressed how estate planning isn’t just for the rich or just about death, and how it is really an act of love. If you missed that post, click here.
As timing would have it, on the day I published that piece I had dinner with a friend I hadn’t seen in awhile. In the process of catching up, I, naturally, invited her to join us tonight. And, she – a single mother, homeowner, and business owner – shared she didn’t have a Will.
My reaction: GASP!
Her response: “Why do I need a Will; won’t everything automatically go to my son?”
She’s not alone in this sentiment. According to a new Rocket Lawyer-Harris survey, 64% of Americans don’t have a Will.
But, ironically, not having one isn’t really the biggest mistake my friend is making (and many others like her): ONLY having a Will is!
At a minimum, there are three other documents that you need in addition to your Will. This is an oft overlooked misstep.
And so is having an outdated plan.
Depending upon what source you reference, the number of people without an estate plan ranges from 50%-70%. But perhaps you fall in the 30%-50% range of people who actually DO have one. If true…
…is the plan you have the one you want to have?
Both Paul Walker and Philip Seymour Hoffman had estate plans created – in 2001 and 2004, respectively. However, their tragic and untimely deaths put this common estate planning blunder of not having a current plan front-and-center for a number of “costly mistakes” articles.
Above, I’ve just shared two obvious and not so obvious estate planning mistakes. During my conversation with Lori Anne tonight, we’ll flush out a few more. Of course, along with what to do instead and why these actions are important.
Admittedly, I have no clue what in the world “conscious uncoupling” means, but I do understand the need for having a conscious approach to estate planning.
- It’s how you organize your personal + financial affairs.
- It’s how you address the mistakes you know you’re making AND become of aware of the mistakes you don’t realize you are.
- It’s how we each contribute to the dismantling of the misconception that the estate planning process is only for a certain few or relevant to a narrow set of circumstances.
- It’s how you ensure you don’t fall prey to the “someday, one-day” mentality that can grip you and lull you into procrastination mode until it’s too late to be thoughtful, intentional, and strategic.
- It’s how you get to know yourself even more intimately. Estate planning invites you to ask yourself some probing questions and take stock about what and who is most important to you. (See, I told you it was about love – and that includes self-love!)
- It’s how you put on your big girl or big boy pants and take the reins to control how you experience life and money – and not just sit on the sidelines “taking” whatever comes your way. I realize you may not take a passive approach in other areas of your life, but for some, money makes them a little gun-shy. If this is you, let’s stop this pattern now, shall we?
Thinking of estate planning as an act of love isn’t a matter of semantics for me. Nor is looking at it as a testament of self-love. I truly believe this and want others to hop on the bandwagon with me. And that includes YOU!
I am SO excited for tonight, and if you haven’t registered I hope you’ll accept my invitation to join Lori Anne Douglass, Esq. and me at 8pm EDT for this month’s Financial Intimacy Hour.
I promise it’ll be a lively experience. And, I promise you’ll know more at the end of 60-minutes than you did at the beginning.