Enjoy my Friday money solution and enhance your financial savvy one simple step at a time.

It can be empowering to see the future value of your wealth compounded over time, and even more empowering to follow your money plan.

Investing is simpler than you think!

The level of attention you give to your money
Your daily spending habits
Your daily earning habits
(Days turn into weeks, then months, then years, right?)

This paradigm can easily be seen when you look to see how much your money will be worth at a certain future date, based on the amount of money you put away to grow, and the earnings you achieve from investing that money. The importance of this concept led me to create a calculator for you on the Financial Woman website; just click the calculator tab to play with it.

Did you know that if you:
Put away $50,000
Add just $500 a month
Grow that money at 10%
And don’t withdraw any of the money, it will be worth almost $613,000 in 20 years?

Assign some dollar amounts and time frames to each of your money reasons. Use this calculator to help you get what you REALLY want in your life that money can buy. If you aren’t already receiving the Financial Woman Nest Egg Newsletter, be sure to sign up today so you can get the videos that step you through this dynamic wealth building tool in the newsletter over the next few weeks.

This year I have decided to choose a focus area for personal growth, and now plan to do this each new year; I think that business growth and personal growth are really one in the same; when we increase our skills or lifestyle, we grow personally as a result of that enhancement.

Growth may come in any area we choose to focus, ranging from healthier eating habits to improving personal finances. The effects of the change, however, spill over into all areas of our lives.

Let’s look at improved eating habits as an example of proactive change. When you eat healthier, you feel better. When you feel better, you are more productive and focused in all areas of your life. The result of this increased productivity may be increased income, greater confidence (which improves relationships) or simply more harmony in life.

Using the example of improved personal finances, a few of the areas we could expect immediate enrichment in our lives include:

A lifestyle that is more congruent with our financial goals, thus more harmony in our daily lives

Personal and professional growth, as we gain skills to increase income, if necessary or desired

Increased confidence from financial empowerment, and therefore, more happiness

Less stress from having clearly defined purposes for our money, alleviating the need to analyze every financial transaction

More peace from either knowing you are headed toward your financial goals, or taking steps to get going in the right direction

A life that is full of the things that you really want and value

These are only a few of the areas where improved personal finances enrich our lives. With that in mind, is this an area where you want to focus this year? If so, you’re in the right spot! I’d love to hear from you today at Camille@FinancialWoman.com for a free 20 minute Money Strategy Session with me.

Enjoy my Friday money solution and enhance your financial savvy one simple step at a time.

Everyone in a high tax bracket should consider some form of investments that lower personal income taxes.  This is often in the form of alternative investments such as rental real estate, oil and gas partnerships, or small business ownership.

Investing is simpler than you think!

Let’s look at this quote from the context of the work being our financial plan, or the mission to grow money so we can reach our financial goals and have the life we desire.

Out of clutter finds simplicity. Do you know how much money you have and where that money is? Do you know how much is flowing in and out every month? Can you easily access those numbers? January is the perfect time to reduce financial clutter while you are still motivated by the freshness of the new year filled with promises of enhanced personal empowerment that comes from being your very best self.

From discord find harmony. Are you at that place of discontent with your current financial situation, or perhaps lack of financial prowess, that you are at last aroused to commit to the attainment of your financial goals so you can live each day congruently and in harmony? The ultimate gift, of course, is being one of those 20% of Americans aged 25 to 55 who feel confident that they will be able to live comfortably in retirement.

In the middle of difficulty lies opportunity. We are certainly in a time of great discord in our financial system, with 80% of Americans saying they will not have enough to retire comfortably, according to a SunAmerica / Teresa & H. John Heinz III Foundation National Women’s Retirement Survey. Not only do opportunities follow discord, there is always some type of investment that offers value for those willing to seek and act. Additionally, rock bottom has often been just the thing to get me off my derriere and into action to make the changes I know I have needed to make for years, but didn’t for some unacceptable excuse.

Clutter, discontent and discord are three great financial motivators! I don’t know about you, but lacking those, I could be tempted to spend the entirety of my days relaxing on the beach while listening to the waves with my big hat, a comfy chaise, and a fine book.  Sometimes blessings come in disguise.

Spending this time also allowed me to focus on improving my own financial plan without the distractions of running a business (or two), family issues or other commitments.  (Does anyone really want you to carry out their volunteer duties if they are going to cough all over everyone?)  And to be honest, I really needed to spend time focusing on new ideas and strategies for my own personal investments, something that we all need to make time to do.

As the writer of a financial education blog, I am constantly asking myself what I need to share with my readers.  What information have I learned in three decades of investing (successes and mistakes, where we learn the most!) that I can share with you to help you start reaching your financial goals now?

Several key concepts surfaced once again from this day of focusing solely on investing that I am reminded to share with Financial Woman readers.

1. The importance of understanding the use of benchmarks when you choose or monitor an investment product or financial advisor is crucial. Not utilizing this simple tool is akin to giving your children over to a total stranger without first checking references, and then not making sure they are alright.
2. Choosing the outcome you want from an investment is the first step in selecting that investment. The two choices are cash flow or capital appreciation, although some investments provide both. Unfortunately, investments can also provide capital depreciation, and negative cash flow, but tips for preventing that is best saved for another article.
3. Everyone in a high tax bracket should consider some form of investments that lower personal income taxes.  This is often in the form of alternative investments such as rental real estate, oil and gas partnerships, or small business ownership.
4. Working with a financial advisor doesn’t mean you are free from responsibility for your money, and knowing the basics of where and how your money is invested.  Also, the alternative investments mentioned in the third point are in an area that’s not likely to be addressed by a typical financial advisor. You are the orchestrator of your wealth.
5. Most people don’t realize that Treasury and other highly rated intermediate and longer term bonds are not as safe as they might seem because bond values go down when interest rates rise.
6. Expenses in the form of taxes and fees take a bite out of every investment.  Know what you are paying, and always look for ways to lower these two expenses so you can accumulate wealth.

These principles are as essential as a great pair of jeans and black boots.  Each of these topics is addressed in detail in my 7 Essential Steps You Must Take Now to Secure Your Financial Future course. It is a home study investment program that includes basic information that is truly essential for anyone who has any money to invest.  A few hours of your time, and $147, or less than the cost of a good winter coat, provides financial empowerment today.  And, unlike the coat, financial smarts will keep you warm for life, not just a few seasons.

Money is paper; it becomes a tool when it is put to use. Constantly ask yourself if and how your money is working for you.

Investing is simpler than you think!

The first tip I shared is realizing that projected investment returns are based on probability. As an empowered financial woman, you need to be able to measure that probability with some degree of accuracy and satisfaction.

Any investment you choose to make, other than cash, is based on probability rather than certainty.  Even cash is subject to loss from inflation and opportunity cost.

The probability you are seeking is that the investment advice is accurate most of the time; no system or method is ever going to be 100% accurate. Acceptance of probability is crucial with investing and growing your money.

How do you go about assessing probability? Here are a few tips that apply to both financial products and investment advice from money experts, such as newsletters and programs:

What is the past record of the investment performance?

What was the degree of loss during previous market corrections in that specific type of investment? This indicates just how wrong the advice was.

Did the investment rebound in the past, and if so, how quickly?

Has the investment program or method had strategy changes since the past corrections?

Did the investment decrease in value more or less than other investments in the same category with similar risks?

There are several complex and somewhat scary sounding statistical tools that are used to measure risk probability in comparison to another investment, known as a benchmark, such as standard deviation, alpha and beta. These common investment tools measure the volatility along the way to the end result.

For personal savings marked as long term investment money, I believe it doesn’t matter as much what money does along the way, so much as the end result. While volatility is certainly important for money that may be needed next month, for longer term money, it’s most important that the money be there at the time you need it, and that it grew as you had planned so that you can achieve your financial goals.

I like to keep things simple by looking at dollar amounts and time frame. This helps avoid the overwhelming feeling that can come from terms like alpha and beta. I compare this to tech talk, like html and binary; just hearing them makes me feel uneducated, yet I still manage to achieve the results I want from my computer. Now to have the dollar amounts I want within the chosen time frame!

Why am I asking this question when I am clearly invested in Financial Woman at this point? I recently presented my business model to a group of successful Austin business women. A couple of the women suggested that it was almost inappropriate to have a financial education site just for women, especially with “pretty things” on it.

On the other hand, I have received wonderful feedback from so many of you about the colorful wealth art handouts I have created that support my belief that personal finances can not only be fun, but also include some artsy handouts. One financial advisor at the Austin Women’s Conference and Show came back to my booth to hug my neck because she liked the Money Flow Wealth Art Chart so much. (I’m still touched about that.)

Here are my thoughts…When it comes to a position, absolutely, and of course, the best person for the job wins. But let’s face it, Nordstrom’s has separate women’s and men’s departments for a reason; as a general rule, women like things that are visually appealing, or pretty, and men generally like things that are not, unless they are on a woman, a piece of art work or part of the scenery.

Why can this paradigm not apply to a website that focuses on financial education for women? Let’s acknowledge our differences, and even celebrate them.

Many women birth babies, men don’t. Women were the original gatherers, and men were the hunters. And it seems that we still are the gatherers, since studies consistently reveal that women control more spending than men. (My research ran across this Wall Street Journal article which questions the often quoted 80% + figure, but nevertheless, still supports that we are the shoppers.)

Additionally, studies show that men and women process information differently. This relates to everything from education to decision making. I love presenting information in a way that women naturally relate in my financial education courses and articles.

Let’s acknowledge and honor our differences, and even celebrate them.

Would we be offended if there was a “men’s only” financial education website? Probably. Perhaps we are making up for the time when women left the room when the men folk had money conversations, not too terribly long ago. I would love your thoughts, financial women. Let’s own it, but in a way that’s appealing.

Your investment portfolio is like your clothes wardrobe; Before buying anything new, always make sure the pieces fit into your overall plan.

Investing is simpler than you think!