My 2Cents!~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~A Newsletter all about Living with Abundance, Ditching Debt and Collecting Cash.
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------------------------------------------------------------------------------------------Janine Bolon, Editor janine@smartcentsinc.com
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In this issue -- Note from the Editor -- What Do I want Out of Life? The Fine Art of Dreaming. -- Christmas in June: Talking with Family about the Commercial Carousel -- Book Review: “Passion Saving”, by Rob Bennett -- Charity Highlight: The Linus Project -- Reader Tip: Money Market Accounts -- Reader Question: Resources for Investing -- WHO WE ARE
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Note from the Editor ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ Dear Frugal Friend, After another round of phone calls with various clients and financial consultants, I am pleased to bring you a newsletter full of cool ideas and perspectives. “What do I want out of life?” is a big topic these days due to books and videos on the Law of Abundance (like “The Secret”). The challenge is figuring out what it is you really want from life and then working out a plan to accomplish it. This article will get you started on remembering the dreams that used to have you bouncing out of bed each day in excitement. Next comes along a discussion of Christmas. Is June too early to start thinking about it? Not at all. “Christmas in June” will assist you in opening up the communication with your family to keep the commercial Christmas merry-go-round to calm levels BEFORE all the hype begins. Also, Rob Bennett’s book, “Passion Saving,” has been reviewed and will be opened up for discussion during June. How would you like to have Rob pop by the blog to assist me in answering questions as you read his book? Stop on by: http://themoneymuse.blogspot.com/. Wishing you abundance, Janine What Do I want Out of Life? The Fine Art of Dreaming. ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ Over the past two years of travel, speaking and talking about money with numerous people, one thing has become very obvious to me. Many of us don’t know what we want. For those who do know what they want, they are the successful ones. They have a savings account. They have little to zero debt and are working on becoming “retired” by the time they turn 45-50 years old. Whereas, those who don’t have a clue what they want out of life, except winning the lottery, have the problems with debt, over-extended credit and a car on its last leg (or axle) with no idea how they will be able to replace it when it finally gives up the ghost. Now you may not be that badly off, but I think you know where I’m headed with this. If you wish to be financially successful, you need to know what you want out of life. As Rob Bennett says in his book, “Passion Saving,” “To be middle-class almost by definition means to be on a quest for more meaningful work.” This is so true. Many of us have credit card debt, mortgages, loans and medical bills; how can we possibly dream of living “off grid” in Colorado when we have all that looming over us? How about giving your dream one more try? Until you nail down what you truly want out of life, all your financial goals will fall by the wayside because you don’t know why you need to be saving money. So, sit down with a piece of paper and a pen and write at the top of it, “What I want most in the world is...” and fill in the blank. What you write may surprise you. Most folks start off with the standard stuff: “a healthy family, a house, no debt, and a better job.” But I want you to work past these things and go deeper. Why? Because I know that you have given up on your real dreams. At some point in life you gave up on a passionate dream because you didn’t see how it was going to be possible to achieve. Rather than trying to figure out a solution, it was SO much easier to drop it and then try to fill that emotional void with impulse spending and driving the credit card balance up to higher levels. It was easier to deal with the pain of debt repression then the fear of attempting to achieve a dream. Your dream is possible. I know you may not even remember what it was that drove you so passionately when you were 8-12 years old, but it is usually at about that age when most people stop believing in themselves and their dreams and start walking the path of paycheck-to-paycheck living. For my husband, it was giving up on getting a history degree because he was told by so many of his friends and family that a young man couldn’t make a decent living with such a career path. Here he is now at 45 finishing up a degree in history and feeling great about finally doing what he has always wanted to do. Studying history and writing books. For me I gave up on ever getting a doctoral degree. I almost starved myself through the 5-year degree program for a Baccalaureate in Biochemistry. No lie. I had dropped down to a dangerous weight and would not have been able to continue if I had to go an additional semester. Now, here I am at [age omitted because a lady never tells!] and just last week I applied to a Ph.D. program. Thanks for celebrating with me! What dreams have you given up on? Are you having problems figuring out how to remember them? Here is a list of things to do to get your memory moving. Answer these questions on a piece of paper. 1-If I had all the money in the world, what would I do with my time? 2-If I could spend my time in any way I wanted, what impact would I make in my community? 3-What have I always wanted to do for myself, but stopped because I was afraid? Don’t let the fear stop you this time. Write this down. 4-If I didn’t have to worry about the opinions of friends, family or spouse, what things would I do? These questions may seem a bit simplistic, but I have found that when I’m mentally blocked on an emotional topic, it is the simple questions that get my thinking gears rolling. Write your responses down. Don’t just sit there at your computer and stare into space working on your answers. Bring them into our 4-dimensional “real” world and put them on a page. Once you have figured out your dream, then it is time to put that dream into an action plan. Let your mind wander and consider the financial, educational, and support systems needed to help you achieve it. Here is an example. One of my relatives decided at the ripe age of 57 to go back to school to become a doctor. Yes, a doctor! Her children were all for it, but her friends were the naysayers in this. She frequently heard them say, “But Grace, you’ll be 67 before you’re even done!” Quick as a flash she answered back with, “Yes, but I’ll be 67 anyway.” Grace is my inspiration! After you have finished writing down your dream, you are going to e-mail me. Okay, maybe you don’t want to e-mail me, but the idea is e-mail it to someone and discuss it with them. Ask for help on how you are supposed to accomplish this dream. The ideas will start to flow. Your mind will start to work on possibilities and potentials. That is when the fun begins. That is when you become financially mature and begin to change your money situation. Money…It’s Not Just for Rich People! LIVE! ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ Here is the simple financial system you’ve been waiting for on a 5 CD set! No crazy budgets, no incomprehensible financial jargon, just every day language and easy-to-understand exercises to rocket you out of debt and guide you to a wealth accumulation lifestyle. SmartCents is all about changing people’s mentality from financial scarcity to that of abundance. Usually this is done in a two day seminar where you are given exercises and are shown the flow of money and how to partition your money according to the 60/40 Principle. SmartCents has made this two day seminar available on a 5 CD set. It was recorded live so you can hear questions from the audience as well as get a dose of my wacky humor. You can order your set for only $80 (includes shipping) from: http://www.speakupproductions.com/Money_Live.htm Christmas in June: Talking with Family about the Commercial Carousel ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ For all my readers who don’t celebrate Christmas because of their particular religious practice, please replace “Christmas” with whatever celebration you want to simplify and all will be well. On to our story... It is a Christmas that will always stand out in my memory. After eight trips up and down our townhouse steps on Christmas Eve, I was sitting on the couch six months pregnant with our fourth child. Across the living room I saw the cute little Christmas tree sweetly decorated with strings of popcorn, cranberries and cut-paper decorations. The children had put small candy canes along the lower rows of branches. As my eyes traveled down the beautiful but simply clad tree, they came to rest on the carnage that used to be a carpeted floor. My plodding up and down the stairs had been productive. Packages by the hundreds seemed to rest there on the living room floor. Like a boulder field below a mountain, packages were strewn so far from the tree you couldn’t have reached it to put an ornament on it! As I stared at this mass of gifts that came to us compliments of well-intentioned family, friends and co-workers, I wanted to cry. I knew that many of these gifts were for the children and I also knew that the toys and packages took time, effort and money to reach us. However, I also recognized a sad fact, that after the third gift was unwrapped my kids would lose interest. They were still young; I had a 6-year-old, a 4-year-old and a 2-year-old. I knew that Christmas for them was all about the excitement and joy of seeing new toys and packages, but that they could not sustain that enthusiasm when they had received too much. The pile under the tree represented way, way too much! Please don’t think I am being ungrateful here. I’m not. I was touched by the thought that each one of those presents represented. I was thrilled that so many people loved us that they had sent these gifts to brighten our Christmas morning. However, it was too much. By having too much, my children would not use most of the toys. By having too much, my little townhouse would become packed full with objects that would require attention, storage and clean-up. By having too much, my children would rip off paper of packages and move on to the next gift without even giving consideration to the one just opened. This is not how I wanted to celebrate the sacred time of Christmas. I wanted simplicity, not excess. I have heard over and over from friends, colleagues and clients how much they dislike the glut of Christmas and all the financial stress it brings. “How do you stop it?” they plaintively cry. I don’t blame them for the sentiment. The holiday itself is wonderful, but buying stuff has managed to get out of control. Here are the steps that Brad and I had with family and friends to change our traditions to a simpler system. 1-Start the Christmas conversation now. With summer here people are more willing to chat about the commercialism of Christmas because the stores aren’t full of messages that say you MUST buy product X to be a good relative or you’re a cheap jerk! Now is the time to discuss options to Christmas giving. 2-Draw names for gifts. Many families already do this, drawing one name to receive a major gift at Christmas and then buying little “stocking stuffers” for other members of the family. This works especially well when you set an upper limit to the gifts. We did this one year and had a $20 limit (by the way that’s $20 total for the main gift and stuffers!) It was a blast to see the creativity everyone brought to the celebration. 3-Explain and show Grandma and Grandpa other ways that they can demonstrate their love throughout the year rather than saving it all for Christmas. I pick on them because in our family they are the major spenders in the gift-giving arena. I had to explain to my wonderful parents that I appreciated what they were doing for their grandchildren, but what the kids REALLY loved was mail. We discussed that they send short notes to the kids and articles from magazines during and after the holiday season. This idea hit the jackpot. Grandpa now sends his grandsons a new quarter for their collection as each new edition is minted along with a short handwritten note. My sons love it. 4-Buy gifts after Christmas Day. I have a couple that told me this works great in their family. Each person posts on the web site what they want for Christmas. The family members “sign up” to get the gift they want to buy and the actual purchase is done AFTER Christmas when the sales hit and the pressure it off. Then in January the family celebrates Christmas! They told me of the thousands of dollars that the family has saved not only in gift giving, but also in air fare!!!! 5-Ask for or give gifts that are perishable or require no storage space. My favorite gifts to give and receive are books, magazine subscriptions, and food. I read books and then give them to the library. I read the magazines and then give them to friends who I know will enjoy them, or recycle them. And I love cooking in the kitchen. Remember that re-gifting is a fine art form that is frugal, not cheap. You can do it as long as you don’t give the gift back to the very person who gave it to you. If you’re not going to use the gift, by all means, give it to a person who will. The bottom line is this, dear friend. The act of giving gifts is to let folks know we thought of them. What the actual gift is doesn’t matter as much as the thought that went behind it. This has always been my view; unfortunately, I didn’t have family that always agrees. It took three years and many, many telephone conversations, but, finally, we have détente! (Celebrate with me here!) When Christmas arrives, we are no longer deluged with packages. Our tree actually can cover all the packages with its limbs and the kids get one “big” gift and several little ones. How did Brad and I bring about a non-commercial Christmas? We started using money. That’s right. Grandma, Grandpa, Aunts, Uncles, and Cousins -- all of us now ship money (not cash) through the mail and ask the folks on the other side to buy what they want. It took years of working on this and trying LOTS of other options before there was mutual consensus on this simple and obvious solution. Now, we all save on shipping, time at the mall and gift wrapping. And we always get what we want! Some people have told me that money doesn’t say as much as a “real” gift. Then I look at my four kids playing with the “exact” toys they wanted from Grandma, Grandpa, Aunt and Uncle. I see the excitement and joy of Christmas still in their eyes after the last gift is unwrapped and I see them totally thrilled with the treasures. Brad and I exchange our gifts after Christmas because we go shopping for each other during the sales on December 26th. You will have to come up with your own system for handling Christmas this year. I suggest you initiate negotiations now for scaling down on the gift giving. Be creative in options that you list as potential traditions for the new Christmas coming along. Given enough time, you too, can celebrate the true joys of the season without the financial stress of the commercialism. Here are some web sites that have articles and stories on returning to simple holiday seasons. http://www.simpleliving.org/ http://www.newdream.org Book Review: “Passion Saving”, by Rob Bennett ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~For the past two months Rob Bennett and I have been trading e-mails and phone calls as we work together to bring our country to a stronger financial footing. In his book, “Passion Saving,” Rob mentions several things that had me saying, “Hear, hear!” as I was down in the den reading. My husband would look up from his paper and ask, “Everything alright, dear?” and then I would launch into a 15-minute discussion with him. Here are some of the points Rob makes in his book that dovetail nicely with the 60/40 Principle and how to establish realistic financial goals. 1-“Saving money is a lot like spending it, if done right. It’s not about self-denial. It is about putting money away to use later for a richer, fuller life!” Here Rob is making the point that saving money for “retirement” is not enough incentive for most folks. What you need is a really strong reason for saving that is not along the lines of “because it is important.” There is not enough emotional leverage with that sort of statement to get you going on savings. What you need is a goal that will allow you to sacrifice the expenditures of today for the lifestyle you really wish for yourself. 2-“Saving allows you to buy back control of your time. Money saved is passive income.” These statements bring into play the power of security. As you see your savings account grow you will feel a sense of peace that you had never known before. Rob discusses how to work a financial goal into reality so that you can have a lifestyle you dream of within a workable timeframe. All it takes is a bit of paper, some scratching of a pencil on said paper, and an idea of what dream you want out of life. 3-“Think of the term, financial independence, as referring not to an end point, but to a power that the accumulation of capital gives you to make progress toward the realization of life goals.” Each one of us has our own definition of what the “good life” is. Rob makes the point that we need to plan for our good life and we do it by steady progress on our savings goals. By working out our plan using a bit of every paycheck, we will see progress. 4-“Savings goals are goals that can be realized with five years or fewer of effort.” I love this comment. It is on page 42 of his book, and it is a major keystone for a sustained, stable financial future. If you look at your financial goals closer to where you are now, you’re more apt to stick with them. Rather than looking down the road to when you’re 65, just look down the road 5 years and you will feel a greater surge of energy to reach this closer targets. I’ll be making additional comments regarding Rob’s book on the blog. Pop on by http://themoneymuse.blogspot.com/ to join in the discussion and add your point of view regarding the saving of money. Rob also has a blog: http://www.passionsaving.com/the-financial-freedom-blog.html Rob rants each day on a new topic. (His words not mine!) Charity Highlight: Project Linus ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ This is a charity to which I have donated money or homemade blankets for over a decade. Project Linus is a 100% volunteer non-profit organization with a two-fold mission: First, to provide love, a sense of security, warmth and comfort to children who are seriously ill, traumatized, or otherwise in need through the gifts of new, handmade blankets and afghans, lovingly created by volunteer "blanketeers." Second, to provide a rewarding and fun service opportunity for interested individuals and groups in local communities, for the benefit of children. As my husband and I moved across the country I have worked with various Project Linus chapters in New Jersey, North Carolina, Maryland, California, Idaho and Missouri. You can donate to the national organization or find a local chapter and donate to them. They have need of cash (name a non-profit that doesn’t!) yarn, fabric, and volunteers. This charity has been highlighted in many magazines and talk shows because of its impact on youth and their familys. If you wish to learn more, the national web site is: http://www.projectlinus.org Reader Tip: Money Market Accounts ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ Dear Janine, I'll repeat my suggestion from our phone conversation on the 6% money market account: If you have some cash for a money market account, one of the best ones available is www.fnbodirect.com. The current rate is 6% and will remain at this rate until September. This bank is 4-star-rated by bankrate.com and the account is FDIC insured up to $100,000. This is the internet arm of First National Bank of Omaha in Nebraska. Jan Dahlin Geiger, CFP®, MBA Financial Network Corporation web page: www.financialnetworkcorp.com Thank you, Jan for your education and advice! Jan is also the author of “Get Your Assets in Gear!” It is due out in 2 weeks and I’ll be reading it for July! Reader Question: ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ Janine, What are some good resources for financial planning and investing? Anita, VA Dear Anita: First off, you’re not alone in this question. Many of you have asked for resources on learning how to invest the money you are saving. While discussing with several millionaires their favorite magazines for keeping up with such issues, SmartMoney magazine by the editors of the Wall Street Journal was mentioned as a favorite along with Money Magazine. One financially independent financial planner told me, “I have been interviewed by both Money Magazine and SmartMoney and I was WAYYYYY more impressed with the professionalism and knowledge of the SmartMoney reporter. Money is good, but I think SmartMoney is a notch up.” My personal preference is Money Magazine, so go to your local library and look up both magazines. See which one you like best and fits your personality better and subscribe to it for at least a year. The most important part is to make sure you READ it when it comes in!!!! Good luck. Do You Have a Question or Charity for the Next Newsletter? ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ If you've got a question or charity you want me to address in the next newsletter, please send it to janine@smartcentsinc.com with the subject line "Newletter Question/Charity." My 2Cents will feature a question and a charity each issue from the Frugal Friends Network. If you wish to remain anonymous, not a problem! Just state that in your email.
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