Tag Archives: personal finance

Different Strokes For Different Folks Is A Good Thing; 5 Reasons To Love Money Moxie

There are a bunch of personal finance websites and blogs out there, and many that focus on women.  I think this is great; the more information we have access to, the better choices we can make for managing our money.  But with so many choices out there, why check out Money Moxie?  Here are 5 reasons to stay on top of your personal finances with Money Moxie–and tell your friends!

1. We won’t tell you to ‘lean in.’  Actually do whatever you want.

With due respect to Sheryl Sandberg and successful women everywhere, we all follow a different path.  Some of us are children of immigrants, some have worked our way through college and business school (even against our parents’ wishes who preferred that we just settle down and get married), some of us never went to college but managed to build a successful business anyway. There is no one recipe of success.  Sure, for some women, it’s a gradual rise to the top, from private school to Ivy League to management consulting to big corporation to start-up sensation.  For others it’s a sloppier zig-zag of good luck, dumb mistakes, stupid risk-taking and amazing success.  But somehow we ‘did it’ or we’re in the process of ‘doing it’ and we all have a distinct story of our own to share.

2.  Saving money is not about foregoing the ‘mocha skim latte.’  Personally I don’t remember the last time I went to Starbucks;  it’s not because of the cost, it’s that I feel like my stomach lining keeps getting thinner and more porous every time I get a coffee there.  But the point is, saving money isn’t about saving $4.00 a day.  It’s about knowing ourselves and what’s important to us.

Does money= financial freedom and home ownership?

Does money= the opportunity to make more money?

Does money= the freedom we need to ‘find ourselves’?

Those are the questions we should be asking ourselves and once we know the answer, the rest is easy.

3.  We love ‘shot-callers.’  Every entrepreneur, business owner, freelancer, artist or professional woman has a unique story and experience– how she made it, how she spends her money, how she prioritized to get herself up the ladder.  We love meeting these courageous, smart women, and sharing their inspiring stories.

4. We talk about the economy, the deficit, taxes and the election.  While these topics may cause some droopy, glazed-over eyes, they’re important.  The decisions made in Washington directly impact our wallets.  On the other hand, who wants to spend hours watching C-Span when we could/should be watching “Orange is the New Black?”  We comb through the WSJ so you don’t have to (unless you want to!)

5. We are a website for hustlers.  Sometimes when you break free from the pack and start your own project-whether it’s a new business, a film production company, a freelance lifestyle — sacrifices have to be made. We work several jobs at a time, we work on our passion while we’re ‘working’ at our day job, we’re constantly talking up or about our project.  But that also means that money, time and resources have to be managed wisely.  We often say ‘no’ to nights out with friends so we can stay home and work on our business plan.  Sometimes we say ‘yes’ to nights out with friends so we DON’T have to spend another night working on our business plan.  Either way, been there done that.  And we wouldn’t trade the experience and the lessons for the world.


The Shot-Callers Who Work For Adventure!

By Lena Rizkallah, Money Moxie

Almost everyone has a bucket list.  Whether your dream is to learn how to pilot an airplane, spend six months hiking in South America, teach English in India or ride elephants in Cambodia, a bucket list is personal and often includes a dose of adventure and travel.  I recently met with two entrepreneurs who are capitalizing on planning, packaging and helping women check off some of their once-in-a-lifetime dreams through their new company, WHOA Travel (that’s: Women High On Adventure).

Meet the Founders of WHOA

Allison Fleece and Danielle Thornton met only last March when they were part of a group that hiked Mount Kilimanjaro.  From that life-changing trip, WHOA Travel was born and the two women found their new friendship blossoming into a partnership.  Coming from the international education industry, Allison had always enjoyed travel but thrived in more adventurous trips, experiences where she could push herself but also give back a little.  Danielle, who is an associate creative director at an advertizing company,  confesses that she’s always felt a never-ending hunger for travel and change, and that “I always knew I was going to leave Texas since I was a little girl!” (No offense, Texas!)

Allison Fleece and Danielle Thornton, WHOA founders

Allison Fleece and Danielle Thornton, WHOA founders

WHOA’s (www.WHOAtravel.com) mission is to organize trips for women that are fun, challenging and inspiring, and that allows the group to also give back.    As Allison puts it, the purpose of WHOA is “to provide a transformative experience for women through travel; at the heart of every adventure is an advocacy project that gives back to women and local communities.”

For example, although last March’s Mt. Kili trip wasn’t an official WHOA adventure, Allison arranged for the group to volunteer at Give A Heart To Africa, a nonprofit based in Tanzania that helps provide women with skills and training they need to learn English and make a living.

WHOA’s Adventure Trips

Although WHOA is only a few months old, things are already full-steam ahead!  For the 2013/2014 season, WHOA is organizing three adventure trips and is currently taking reservations.  The first is a trip to the Alps and Bavaria in September where the group will bike, hike and paraglide through the Alps, with a pit stop at Oktoberfest, and ending with yoga in the park in Munich.  All proceeds from yoga will go towards Give A Heart To Africa.

In March, the group will head back to Mt. Kilimanjaro for a seven-day trek with plans to summit on International Women’s Day, March 8, 2014, followed by another volunteer day and safari or resort options.  Finally next summer 2014, the group plans to hike the Inca Trail.  In addition to the three flagship trips, WHOA can also custom organize a special trip for individuals or groups who want to do something different.

Danielle and Allison on Mt. Kilimanjaro--you can be there too!

Danielle and Allison on Mt. Kilimanjaro–you can be there too!

This August, both women plan to leave their jobs and embark on a 7 week trip to Africa, Europe and South America in preparation for next year’s trips.  They will be meeting with contacts for each adventure, make new connections and spend time with the community organizations.  The passion and enthusiasm that Allison and Danielle have for their business is inspiring and contagious–I have a feeling they can persuade the most fearful traveler to hike Mt. Kilimanjaro!

The Early Days of WHOA

Although the energy and optimism at the new company is high, the ladies had to put some work into their partnership. Early on, they realized that they both approach work differently and also have different–but complementary–skill sets.  Allison is the talker of the two, engaging and persuasive, while Danielle is in charge of branding and the creative aspects of the company.  While their start was bumpy at times, since holding a “come to Jesus” meeting in which they were both painfully honest with each other about their goals and expectations, the business has run much more smoothly.  They collaborate on everything and both agree that even their website reflects both personalities.

Is Entrepreneurship Right For You?

The ladies offer simple advice when it comes to starting a business.  If you’re ready for a change and have an idea in mind, “put it out in the universe,” says Danielle.  “I knew I wanted to do something different and I was open about it.”  Allison agrees, adding, “You’ll never regret the risks you take, only those you don’t.”

Both Allison and Danielle agree that when it comes to picking a business partner, it’s important to respect one another and be brutally honest (but kind) with each other.  Working with a business partner is like a balancing act, and as Danielle points out, “It’s harder to find the right business partner than a husband!”

The business partners unfolding the WHOA flag on Mt. Kili

The business partners unfolding the WHOA flag on Mt. Kili

And since they are both leaving their corporate jobs, both women have cut back on spending.  Both are much more aware of their expenses, have stopped buying frivolous things and know that soon those regular paychecks will vanish so they have set and following their own strict budgets.  Allison admits that since she’s eating in more, she’s actually eating healthier!

Go Tell It On The Mountain!

While Allison and Danielle are very aware of the risks of starting their own business, they are certain that there is a need and a demand for a company like WHOA.  After all, many of us desire unique experiences and challenges, we dream of coming home from a foreign land with bragging rights, and we want to show our gratitude by giving back in some way.  WHOA combines all three by offering unique once-in-a-lifetime trips for women around the world.  As Danielle puts it, by taking on challenging trips like those that WHOA organizes, “you can change yourself, you can change the way you look at yourself and you can even change the world a little bit at the same time.”


5 Investment Tips From Kim And Kanye’s Baby

Please don’t judge me.

Listen, I’m not ashamed to admit that I am a reality TV connoisseur.  True, I am a nerd through-and-through (and not the cool-yet-awkward, tech-savvy, Lena Dunham kind). I get excited discussing the value of credit shelter trusts or whether the AMT should be repealed for Pete’s sake!  But on the other hand, I will get super passionate and opinionated when debating whether  it was cool for “Housewives of the OC” ladies Tamra, Vicki and Lydia to ditch Gretchen and Heather after dinner on their recent trip to Cabo San Lucas.  (By the way, it was.  Gretchen and Heather are just a couple of sticks-in-the-mud with veneers.)

I also watch “Keeping Up With the Kardashians” on E.  It’s not because I like watching rich people lay in bed all day in fluffy white robes talking about how stressed out they are, or go on long extravagant family vacations to foreign lands  where they lay around in bed all day in fluffy white robes.  And while I am fascinated (and confused) by the imagination of Bruce Jenner’s plastic surgeon, no, I don’t tune in to the show just to get a glimpse of Bruce’s Farrah Fawcett hair and high cheekbones.  And maybe others are but I am not watching for cracks in the relationship between Kourtney and baby-daddy Scott Disick.

The Kardashians

The Kardashians

I guess I watch the show because it serves its purpose.  Once in a while I want to relax and settle in for completely mindless, unuseful, brain-cell murdering entertainment–and I’m never disappointed!

Well this week was a big week for the Kardashians because Kim and Kanye who’ve been dating since early last year, finally had their baby.  The baby girl came a few weeks early, and while reporters had hovered around Kim throughout her pregnancy and reported her every outfit flub, extra pound gained and every Kim outing sans Kanye, since the birth of Baby K, the family has been very private.

Since I follow the media-hungry Kardashians, I know the eery silence is intentional, even strategic.  Both Kim and Kanye know how to make a ton of money by being in the limelight.  Kim is worth about $40 million while Kanye’s net worth is estimated at $90 million.  Between the two of them, they have been paid millions for sex tapes, law suits, clothing and fragrance lines, appearances and more.  If anyone knows how to turn the birth of a baby into millions of dollah-bills, it’s Kimye.



So while Baby North or Kaedance or Kris, Jr. is still only about 6 days old, we know she’ll be well taken care of and will likely be financially savvy and earning her first millions before age 5.  Here are some investment lessons we can learn from the newest edition to America’s Royal Family:

1. Timing is everything

Baby K arrived five weeks early but right before Kanye’s new album Yeezus dropped (ugh).  As a result she secured the time and attention of both mommy and daddy.  If she’d been born around her due date in July, Kanye would’ve been on tour and may have missed the birth and corresponding media circus.  Not to mention Baby K beat out the arrival of a real Royal (Prince William and Kate’s) Baby.

Similarly when investing in the market, it’s important to know when to get in and when to sell.  While a typical buy-and-hold strategy (investing in a mix of assets for a long period of time) can be smart over the long-term, there is value in watching specific companies or sectors for the right time to buy in or cash out.  Most of us are not financial professionals so it’s wise to team up with a trusted advisor who does watch the market, and can guide you in reaching your goals.  And make it a point to learn about investing yourself.  The more familiar you are with the market, the more equipped you’ll be to take advantage of market movements.

2. Sell High

Has anyone seen a picture of Baby K?  No?  Seems odd, doesn’t it, that a family that makes millions from having cameramen documenting their every move (weddings, births, fights, drunken escapades) hasn’t yet thrown open the doors of the NICU to let the cameras in.  Obviously, Kimye–or more likely momager Kris–is shopping around exclusive photos of baby K to the highest bidder–and will likely get millions!

This rule of thumb seems like a no-brainer when investing in equities but it’s hard to determine when the market has peaked and when is a good time to sell off certain positions.  Many investors learned this the hard way back in March 2000 when the tech bubble burst and tech stocks that plummeted.  A similar thing happened when the housing market collapsed in the fall of 2008, leaving stocks, property values and retirement plans at historic lows.  Yet all along, many experts had warned about the markets collapsing–as the market was skyrocketing– but the general consensus was that the market will only go higher, culminating in what former Fed Chief Alan Greenspan warned was dangerous and “irrational exuberance.”

To take advantage of market highs but minimize risk,  consider investing in an ETFs (exchange traded funds) which combine a group of stocks in a specific sector to mimic a particular index.  An ETF can be a low-cost strategy that gives you exposure to a particular area of the market.  It offers diversification so if one position loses value, the value of the ETF doesn’t necessarily plummet.  In addition to ETFs, many investors appreciate the simplicity and diversification of a traditional balanced mutual fund that leverages equity exposure for higher returns along with consistent returns from government bonds and cash.

3. Acquire an entourage

Have you ever seen photos of Kim or Kanye walking to their car or through the security line at the airport?  True, they are usually mobbed by the paparazzi but look closely and you’ll see a gaggle of handlers behind them.  Baby K is sure to have her share of men-and-ladies in waiting to handle her every whims–and when it comes to investing, so should you!

A financial entourage can include anyone from a financial advisor to an investment club that meets every month, to an online community, a group of friends or an investment buddy, to a collection of trusted websites and television shows that helps you keep up on the markets and the economy.  To find a fee-only financial advisor, try http://www.napfa.org to find someone in your area.  For advisors who work on commission, check out http://www.fpanet.org.  Many websites are available to help you learn about and undertsand the markets like http://www.bloomberg.com,www.Wealthwatch.com, http://www.yahoofinance.com and more.

4. Don’t be afraid to go international

I’ve read that when Kim went into labor, Kanye was just stepping off a plane from Switzerland.  In fact, many credible sources (ummm…US Magazine) reported that Kanye was abroad during much of Kim’s pregnancy, and that after the  birth of the baby the couple plan to move to France.  Whether for more privacy or for the fine wine and decent coffee, the couple may decide that living in Europe provides a better lifestyle for their family.

While world markets have all experienced their share of ups and downs over the past few years, many investors have seen strong returns by diversifying their portfolio and including international and emerging market funds.  Countries like Brazil, India, China and Russia have seen positive earnings in their markets, and emerging markets like Indonesia, the Middle East and Chile are  also benefiting from cheap labor and strong demand.  While an overall portfolio of international and emerging market stocks may not be wise, consider adding exposure to overseas funds as a way to increase returns.  Most of the top fund companies like Vanguard, Fidelity, Franklin Templeton, etc. offer international and emerging market funds so check out how the funds rate on http://www.morningstar.com before investing.

5. Don’t always believe what you hear

It goes without saying that Kanye West talks a big game.  In recent interviews and song lyrics, he has compared himself to God, Andy Warhol and Steve Jobs, among others and made references to his superior artistic and leadership abilities.  The guy is anything but humble and whether his proclamations are accurate, that’s up for debate.  That’s why, as Baby K grows up, she must use good judgement and scrutiny when taking advice from everyone around her.  While her father may announce that he is the king of rap or whatever, and her mother brightly responds with, “That’s AMAZING!” Baby K would be wise to keep critical eyes and ears open and continue searching for the truth.

As investors, we’re inundated on a daily basis with information, facts, opinions, analyses and rhetoric on the market, how it’s doing and where it’s going.  At the office water cooler, there’s always that guy that goes on about his friend’s “genius” start-up.  Turn on the TV at dinnertime and you have red-faced Jim Cramer hollering at a caller from Long Island about why he thinks Home Depot stock is sinking.  Turn to MSNBC and you’ll watch a White House spokesperson clumsily attempting to explain the benefits of the health care legislation.  Change to FOX News and you’ll likely hear a doomsday scenario of where the market –and basically the world–is headed.

All this information can have negative effects on investing if you let it.  On the other hand, tuning into these shows once in a while can provide perspective as long as you continue to work with a financial advisor, pay attention to investment accounts and how they’re moving, maintain a daily routine of reading about the markets (like reading a financial article per day) and discussing your thoughts with your advisor or trusted investment buddy.  It’s important not to give in to the confusion and make investing decisions based on that.

Welcome to the world, Baby K!  May your future–and ours– be filled with bling!

The Shot-Callers With Ingenuity–and Crowd-Funding!

By: Lena Rizkallah, Money Moxie

It seems that the recession and high unemployment rate, as well as general worker dissatisfaction, has created a unique atmosphere for entrepreneurship and creativity.  People have been laid-off, sometimes more than once, and many have realized that they’d rather work for themselves than work for “the man.”  But starting and funding a new business or venture takes money, and as a result, people are turning to crowd-funding sources like Indiegogo and Kickstarter that allow individuals, businesses, non-profits and organizations to raise money from family, friends and friends-of-friends.  This new trend, which also got a boost from President Obama’s Jobs Act last year, is really taking off and helping people raise money so their businesses and projects can take off too!

Nancy Vitale and Nilou Safinya  recently launched a fundraising campaign for their new film/TV production company to raise money for their first short film, RUNNING WITH SHARKS.  The women met through the Middle Eastern theater community and have been friends ever since.  Nancy studied dramaturgy/new script development at Columbia School of the Arts and worked as a dramaturg for various regional theatres all over the US.  She is also one of the founders and the Producing Artistic Director of Noor Theatre (www.NoorTheatre.org), a Company-in-Residence at New York Theatre Workshop, which co-produced the critically acclaimed play ‘Food and Fadwa’ in 2012.  Nilou’s background is also in theatre – in directing, stage managing and producing. She studied Theatre and Psychology at Columbia University and then worked for several years in the NY theatre scene, and more recently for an independent film and TV production company before turning freelance.

Nilou Safinya and Nancy Vitale, co-founders of Eyes Up Here Productions

Nilou Safinya and Nancy Vitale, co-founders of Eyes Up Here Productions

Their joint venture, Eyes Up Here Productions, is a film and theater production company through which they hope to provide a venue for women ( and men!) to tell their stories.  They first short film, RUNNING WITH SHARKS is their own story of being bullied at an aerobics exercise class and the chaos that ensues.

Currently, they are raising money to fund and produce their film and are in their second week of their funding campaign on Indiegogo.  You can learn more about their venture and make a donation here http://www.indiegogo.com/projects/running-with-sharks-a-comedic-short-film-series-pilot.

Recently, Money Moxie sat down with Nancy and Nilou to chat about their plans for their production company as well as their first film.

MONEY MOXIE: What is the concept behind your new production company?

Nancy: The concept is simple – to develop great stories in collaboration with artists we believe in. The name and branding focus the attention of all audiences – up here – at the big screen, small screen, mobile device, theatre stage, you name it.

Nilou: As far as the more tongue-in-cheek implications of the name, we are two real women with real stories to tell, and we want to direct your gaze to those stories. The rest is in the Eyes of the beholder.

MM:  How long did it take to get the company started-from idea to where it is now– and what did it take to get you where you are now?

Nilou: When the script for RUNNING WITH SHARKS was complete, we decided that producing it ourselves would be a great way to launch our new company.

Nancy: This way we are also challenging ourselves to continue generating and developing work once this production is complete.

MM: What are your goals for your company?

Nilou: Our immediate goal is to produce and finish this short by the summertime. Once it is completed, we plan to send it out to both film and TV festivals. We are also going to use the short as a pilot presentation to put forth to networks and broadcasters as a concept for a comedy series.

Nancy: Following that, we hope to develop more properties for TV, film and theatre. We are looking to develop our own content as well as the content of other artists we admire.

MM: Tell us about the project and your goals for the project.  How did you come to the $ goal that you set in your fundraising campaign?

Nancy: The project is a short comedic film called RUNNING WITH SHARKS, which we describe as a story for anyone who has ever felt judged in a swimsuit. It was loosely inspired by our own experience at a swanky Upper East side gym, where we were yelled at by territorial gym rats, who happened to be older than our mothers. Rather than letting it bother us, I wrote about it in an effort to point out how we ladies can be oddly competitive with one another. I would say that the competition doesn’t help anyone, but it made me write a short film script rather than cry in a corner, so it was somewhat helpful.

Nilou: Even though we almost did cry in a corner! Especially when I was yelled at for putting a support belt in the way of the alpha rat and Nancy was snickered at behind her back!  The $8,500 goal we set for the Indiegogo campaign is the honestly the bare-bones minimum we need to rent the necessary equipment, get insurance, hire cast and crew (at extremely minimal fees) and take care of anything else that we cannot get our friends to donate out of the goodness of their big, beautiful hearts.

Nancy: Setting up the campaign, we turned to friends who have funded films and plays using Kickstarter and Indiegogo and asked them about strategies that worked for them. Everyone recommended a brief, upbeat and fun campaign that engaged people as often as possible without being annoying.

MM:  Why indiegogo as opposed to other avenues for investing?  Did you get help from family/friends, bootstrapping or finding investors?

Nancy: As a new, unknown company, finding investors to give us thousands of dollars of start up money is not easy. We could also beg friends and family to help, but that is not a sustainable model. By launching this campaign, we have to put ourselves out there to the rest of the world, tell them why we want to tell these kinds of stories, that they’re important and that we want to tell more of them with their support. It’s about building a base of supporters that will eventually also be our audience.

Nilou: We are simultaneously talking to any brands we have access to as well as possible investors we know just to get the ball rolling and who knows – maybe someone will bite! However, once we complete this first project and have a tangible example of the work we want to do, we will certainly seek investors more actively for company proper as we explore raising funds for our next projects.

MM: What has been the response so far regarding the company and your campaign?  Where are you in terms of your fundraising goal?

Nancy: We are half- way through the campaign and half- way to our goal. Let’s keep it up!

Nilou: The response has been lovely, very positive, and people really seem to enjoy the pitch video as well as the company name. Our friends and family have been very supportive and complementary. We just need to get more people to see it.

MM: Knowing what you know now, would you have changed anything about raising money?  What advice would you offer people who are thinking of bootstrapping, fundraising, asking money from family/friends?

Nancy: Don’t do it too often. Eventually you’ll exhaust your base.

Nilou: We both often raise money for projects that are non-profit in nature, so there’s no financial return on investment and this sort of fundraising can be very difficult, especially past a certain level. To be very clear, Eyes Up Here is not intended to be a non-profit venture.

Nancy: We’re excited about moving into the next phase of profit-bearing entertainment, but we need a little help with this test run first. Please.

Nilou: And thank you.

The Shot-Caller with Plans

A recent New York Times  article revealed that to be considered “middle class” in New York City, one has to make about $160,000 per year.  In other areas of the country, that salary can get you farther–maybe a nice home with a pool, a car or two and a comfortable lifestyle–but in NYC, you’re lucky to be living in a doorman building in a decent part of town and possibly have a parking space.  If people making six-figures are still struggling to afford certain essentials, what if you make a five-figure salary?  How can you possibly maintain a decent lifestyle, have your needs met and maybe even afford a splurge or two?  And more important, how can you save money while living in NYC on a not-so-hefty salary?

Jennifer Cole, a freelance graphic designer (www.jenncoledesign.com), learned the hard way that to save money as a small business owner, it takes organization, prioritization and thriftiness. Yet over the past 4-5 years, she managed to save $35,000 on a $50,000 a year salary–and can still afford to pursue her hobbies, travel and shop!


The Tough Early Days

Up until recently, Jennifer’s experience with money had seemed like a crazy a rollercoaster ride. Growing up, she witnessed her family wrestling with money problems and debt, and she had always had a tenuous relationship with money. In college, she trained herself to be thrifty, living on $50 a week, and became adept at using coupons at the grocery store, prioritizing splurges and being creative with her existing wardrobe.   That frugality extended even down to her shampoo!  Later, as a business owner, Jen struggled to abide by this philosophy, but eventually she found herself in a hole.

She started her graphic design business in San Francisco, then moved to New York City several years ago and struggled to balance the responsibility of her business with the financial demands of living in a big city.  As an entrepreneur she knew that the key to success was managing her finances so that her business could sustain her lifestyle.

Her “aha” moment came one day when she was balancing her checkbook and realized she had spent $2000 in the past 2 weeks.  She was mortified and disappointed with herself–because the bulk of that money was spent on frivolous things and not on necessary expenses.  Soon after, she received a tax bill in the mail and didn’t have the money to pay it.  She quickly realized that if she was to continue her freelance business, she would have to be more organized, and allocate portions of her paychecks to taxes and other expenses.

Making Changes

After some soul-searching and thanks to a loan from a family member to help her pay the tax bill, Jen got herself in gear.  She dove into what she calls “spreadsheet land,” and set up a system that tracks her paychecks.  So now when she gets a $6000 check, she knows it doesn’t all go directly into her checking account; rather, she allows herself to keep half for monthly living expenses, then portions the rest into tax payments, retirement account, savings and business equipment/expenses.

Once she set up her spreadsheet and started using it, saving was a cinch!  By allocating her paychecks to savings and taxes, she didn’t have any lingering worries about missing payments or outstanding debt.  She knew how much she had to spend each month on necessary and variable expenses, and was automatically putting money into savings because of the way the spreadsheet was set up.  The more she saved the more peace of mind she had–and the easier it was for her to set priorities.  With her spending money, she learned how to live on a budget and make the right decisions, and the most important concern for Jen was to be unencumbered with money problems.

Rules To Live By

Five years later, Jen has a thriving business and a healthy savings account, yet continues to live below her means. She says, “Whenever I make money, I don’t up my lifestyle.  I have a hefty savings account but still live in a 300 square foot studio apartment.”  What rules does she live by?  “Set financial goals, live by your rules but don’t change your lifestyle if you get a raise or come into money.”  She says the most important lesson she’s learned is to “align your values with your money; that helps you prioritize how you save  and on what splurges.”

So even as she continues to grow and take her business to the next level, Jen also allows herself the occasional splurge, especially on her favorite hobby–traveling.  She is a fan of airbnb.com and arifarewatchdog.com, sites that offer low-cost travel options for budget-minded consumers.  Jen also does much of her wardrobe shopping online, and snags deals on sweaters, coats and boots all year-round by using coupons and specials advertised on the sites.  In that way, she is always shopping and never “needs” anything.

And this year, she has been pursuing another goal.  With her business and finances in order, Jen has been hitting open-houses and meeting with real estate brokers with the hopes of taking advantage of the low-moderate income housing opportunities available in New York City.  These governent subsidies may help Jen buy her first home–a benefit for people at her income level–but, alas, not available to the six-figure ‘middle class.’

Hairy Therapy Remix


I am your typical New Yorker.  Like many of my fellow city-men and women, I know how to hail a taxi without getting side-swiped. On escalators, I stand on the right and walk on the left.  I let people get off the train before getting on.  I give tourists succinct, exact directions – even offer restaurant recommendations – but don’t linger for small-talk.

However, as a New Yorker, I am an enigma.  That’s because I do not have a therapist.

It seems that every friend, colleague, acquaintance or person behind me in line at the drugstore has at least one therapist and sees that person pretty regularly. It’s not uncommon for a friend to start a conversation with, “Dr. Tony says my journaling is really helping me work through my issues.”  Or interrupt a dinner party to proclaim, “My therapist thinks it’s because my father never came to any of my piano recitals.” Or grab the phone in a panic and shriek, “I need to call my shrink!” after a night of debauchery.

I know that going to therapy is good for one’s mental health and can actually help people learn to deal with anxiety, stress or depression.

Don't tell me, tell your therapist!

Don’t tell me, tell your therapist!

However, as a woman of Middle Eastern descent, I prefer to spend my therapy money on more pressing matters – specifically on laser hair removal, electrolysis and waxing.  No therapist will help me get over the memory of me as a little girl in the fourth grade, sitting in my reading circle surrounded by my classmates. Compared to the cute, skinny blond girls in their bobby socks and tennis skirts, I was a thick hairy rectangle that smelled like hummus, sporting tube socks up to my thighs to cover up my hairy legs.  That’s a memory that is burned into my psyche and for that reason, I prefer to get rid of the evil that caused my anxiety, rather than go sit with someone and have a chat about it.

But everyone needs therapy – or even self-reflection – in order to take responsibility and move forward.

Similarly in personal finance, it’s important to do a little self-reflecting.  Especially now, at the beginning of a new year and as we gather our financial paperwork for tax time, it’s helpful to examine our finances, be honest about our spending and saving habits, and set some new goals to change bad behavior.

Here are some tips for planning a more financially rewarding 2013…

1. Before setting impossible goals for 2013, be thoughtful and thorough. Review your tax paperwork and last year’s budget.  Be painfully honest with yourself and ask, am I happy with the amount of money I made last year? Did I reach any of the financial goals I set for myself last year?  How or why not?  By actively taking the first step – looking honesty and critically at last year’s finances and identifying your satisfaction level with it – you can begin to set the right goals for next year.

2. Figure out your debt and make a plan to deal with it.  Add up your total annual expenses plus any additional debt; what is the ratio of expenses to income?  Were you able to manage debt and also save last year?  If not, review your spending/budget from last year and find three things you can cut out in order to reduce spending, manage debt and/or save.  Allocate the savings to a specific debt or to your savings in order to reach a particular goal.  Be specific.

3. Don’t have a 2013 budget yet?  SET ONE UP NOW!  Use Mint.com to set up a budget online, create an excel spreadsheet to track expenses or just write it down old-school.  Find a way to track your spending and then do it.   Manage debt by consolidating into a low-interest rate credit card and make sure you are paying more than the monthly minimum if you can.  Budget and save up for a six-month emergency cushion, even if that means putting $50 a week into your savings account.

4. Grow your money.  If you have a savings account and an emergency fund, consider taking a chunk and investing in short-term CDs or mutual funds or ETFs.  These can be low-risk options that can help you increase your savings instead of lingering in a low-interest savings account.  Also, make sure you are contributing to your company’s 401(k) and if your company doesn’t offer one, set up an IRA or a Roth.

5. Set a personal financial goal (that is also attainable) for 2013 and take the steps to get there.  Do you want to increase savings by 20%?  Do you want to get rid of all credit card debt?  Are you saving for a new home?  If that means taking an additional shift at work or getting a part-time job, do it. Or, are you ready to invest $15,000?  Check out some of the top online brokerage sites like Fidelity, Scottrade, or Etrade that also offer research and investing tools so you can do it yourself.

And if you’re ready to seek professional help, visit FPAnet.org to find an advisor in your area or NAPFA.org for fee-only advisors. Like a therapist, a financial advisor can help you identify bad habits, set priorities and help you reach your goals.  But they probably can’t help resolve any lingering daddy issues.

The Bond Bubble Explained

Thanks Tony Conte of Conte Wealth Advisors for this clear explanation of the bond bubble!

The past decade has been one marked by quietly inflating bubbles which unexpectedly burst leaving, financial markets reeling, diminishing opportunities for profit, and leaving investors’ life savings in unsettling flux due to volatile securities prices.  The burst and deflation of the technology bubble in 2000 led markets spiraling downward and, exacerbated by the terrorist attacks of 2001, erased a stunning $5 trillion of market value in just two harrowing years. More recently, the burst of the housing bubble helped to weaken markets and played an integral role in the evaporation of $16.4 trillion in U.S. household net worth from spring of 2007 to the market trough in mid-March 2009.

Bubble Bath

With the ever-imminent threat of total hysteria over daily market movements (thanks in no small part to the immediacy of reporting on 24 hour news stations drumming up advertising revenue through the creation of catastrophes, each complete with its own theme song), let’s get a little perspective before we whip ourselves into a frenzy in search of the next big bubble poised to burst.  A “bubble” in financial markets is simply the trading of an asset or security at unreasonably high valuations (eg. over priced stocks) followed by a sudden devaluation of the security, or a crash in prices.  Bubbles are as old as currency and countless numbers of them in varying magnitudes have risen and fallen over hundreds of years.

Some bubbles are fun, others not so much.

Some bubbles are fun, others not so much.

Tiptoe Through The Tulips

Ever heard of the Tulip Bubble?  That’s right, there once was a financial crisis surrounding the price of the popular, and seemingly innocuous flower which must complete a 5 to 7 year gestational period before being harvested and sold as the tulip that we’ve all come to know and love. A Dutch craze for the flower brought from Turkey and Holland led to an insurmountable demand while supplies dwindled due to the many years required for the plant to properly flower and replenish supplies.  At the height of this tulip-mania, some Dutch homeowners were trading their properties for tulips, which saw a 20 fold increase in value in just a month’s time.  The clearly unsustainable valuations collapsed over a period of weeks decimating the value of some tulips to merely one hundredth of their previous prices.  This was in 1636.

The Tulip Bubble

The Tulip Bubble

You see, bubbles are not new and are certainly nothing to panic about, but rather they are something to be wary of and managed with care and caution.

Madge, You’re Soaking In It

The funny thing about bubbles is that we often don’t seem to recognize the formation and growth of a bubble until we suffer the detriment of its decline.  The challenge in predicting even the existence of a bubble can sometimes be overcome with a reconciliation of bare facts.  Let’s lay them out here and see what you think.

In the first three quarters of 2012, roughly $220 billion had flooded into bond mutual funds. Going back just a few years to the collapse of Lehman Brothers in 2008, over that period of roughly four years investors deployed a staggering $900 billion in cash to bond mutual funds.  Many investors look to bonds for safety of principal and stability (relative to equities and some other assets), and fear of investing in more volatile assets seems to have encouraged an exponentially increasing interest in holding bonds and bond mutual funds. What many investors may not realize is that you can, in fact, lose money investing in bonds.

When the price of a bond goes up, it’s yield (the cumulative return of the instrument accounting for not only the bond’s interest rate, but also the price you had paid to purchase the bond) goes down. Could investors be mistaking the rising valuations of bond funds over the past few years as evidence of their supposed safety? The converse is also true: when interest rates finally begin to increase, the value of outstanding bonds is expected to decrease.  The all-time record high prime rate in the United States was 21.50% onDecember 19th, 1980. This means that if you were purchasing a bond around that time, you were lending your money to a company or entity in exchange for a bond certificate which promised that the entity would pay you interest (commensurate with the insolvency risk of the company issuing the bond) around that incredibly high interest rate.

In hitches and starts over the ensuing decades, at least until December 12, 2012, that prime rate has decreased to its current (as of this writing) standing at 3.25%.  Knowing what we know about the effect that interest rates have on the value of bonds in the secondary markets, one might deduce that the 30 year bull run on bonds will have to come to an end if rates are ever expected to go up.  To give you a sense of what this may mean to US Treasury Bond investors, consider this: A 10 year treasury bond issued at a 2.82% interest rate could see a 42% loss in value from a mere 3% rise in interest rates. Meaning, if you’d held $100,000 in these bonds prior to the rise in rates, you would only be able to sell those bonds for $58,000 in the secondary market after the 3% rise.



What To Do?

At first glance, the bond bubble situation may seem dire, but the informed investor may find him/herself well positioned to take advantage of this seeming inevitability.  True, investors have often bought bonds in a flight to assumed safety; however, in times when even the seemingly “safe” investments threaten to veer into a range of volatility, what is an investor to do?  We counsel some of our clients to consider avoiding bond mutual funds in favor of purchasing the individual bonds themselves with an intention to hold those bonds until their maturity.

Fluctuations in the value of a bond that an investor had intended to hold until maturity should minimally, if at all, affect

the investor’s long term expectations of yield. Most bonds are redeemed at a flat $1,000.00 per bond.  If a bond price fluctuates to a value of $900, $800, $700 or even lower, it could still eventually achieve redemption at “par” (that $1,000.00 value for most bonds).  This remains only one of many strategies to utilize this asset class with full understanding of the possibility of a coming storm and the ensuing rude awakening for complacent bond fund holders.

Bubbles come and go, of course, but with proper and prudent management and investment guidance, the average investor still can stand to gain from these perceived threats to our economy.

Anthony M. Conte, MSFS, CFP ® Managing Partner Conte Wealth Advisors, LLC 2009 Market Street Camp Hill, PA 17011 Phone: (717) 975-8800 Fax: (717) 975-0646 tony.conte@contewealthadvisors.com Registered Representative Securities offered through Cambridge Investment Research, Inc., a Broker/Dealer, Member FINRA/SIPC. Investment Advisor Representative Cambridge Investment Research Advisors, Inc., a Registered Investment Advisor. Cambridge and Conte Wealth Advisors, LLC are not affiliated.

Measure Your Financial Body Fat

It’s mid-January; do you know where your New Years Resolutions went?

Hard to believe that the holidays were just 2 weeks ago.  Usually by mid-January, the mild depression caused by lack of sunlight that grips most of us in the Northeast is in full effect.  This year it’s that plus the flu.  No wonder, then, that many of us have discarded our New Years Resolutions like some forgotten grocery list dropped on the floor of the Times Square subway.

Picking up the pieces of our New Years Resolutions

Picking up the pieces of our New Years Resolutions

But even if you got sidelined by the flu and haven’t been able to make it into the gym yet, or maybe went to Macy’s with the $100 gift card you got for Christmas and accidentally left with a couple of pairs of boots, three cable-knit sweaters, a blender and a European-style mattress, don’t let a little bad behavior stop you from making good on the promises you made to yourself.

One of the top three resolutions has to do with money.  People vow to get out of debt, save more, or start investing.  Setting financial goals is always top of mind for most people.  And like the other top resolutions–losing weight, becoming a “better person (whatever that means) or volunteering (good luck with that!)–nothing will be achieved unless you set goals, make a plan and work towards those goals.

But before you go transferring your entire savings account into your 401k, or opening an online brokerage account and depositing last week’s unemployment check, or saving up for a Bloomberg station so you can start day-trading…chillax.  Think of the old adage “you don’t know where you’re going ’til you know where you’ve been.”  In other words, determining your financial foundation first helps you understand yourself better and your attitude towards money which in turn will help you set–and achieve–better financial goals.

Recently, I joined a new gym.  I’d been going to the good ol’ run-of-the-mill gym for years and was tired of the broken machines, humid conditions and questionable stains embedded on the “clean” towels.  This new gym is beautiful, shiny, sleek; it’s the gym that the one-percenters go to, and even though I am not currently a one-percenter, this gym gives me access to this special status, if only for 3-5 times a week.

The one-percenters on treadmills

The one-percenters on treadmills

With my new gym membership , I’m entitled to a couple free personal training sessions.  I recently met “Tareeq,” a tall Dominican glass of water who approached me in the gym and pretended to flirt with me so that I would make an appointment with him (yes, that’s what they do, those wily personal trainers; they flirt with you and flash smiles in hopes that you will hire them as a trainer!  And of course it works.)

Last week was my first session where we basically took my measurements, did a fitness test and talked about my goals…basically a humiliating start to my Friday.  Funny how I started out the session pretty optimistic, cracking jokes, telling Tareeq that my weight “ain’t nothin’ but a number, just like my age, know what I mean?  Haha!” And then by the end of the session, after I had ran, walked a steep incline, attempted push-ups, sit-ups, gotten my fat pinched in various parts of my body and then stepped onto a scale–I was depressed and quiet.  My goals had changed.  I had walked into the session thinking, ‘I feel good, just want to tone up my lower body, and have fun working out’ but after I had evaluated my present state of health and fitness, I wanted more.  I wanted to lose weight, strengthen my core, lower my blood pressure, burn more fat during a workout, fix the sag situation in various parts of my body.

When it comes to finance, just like in fitness, we often make lofty goals without truly evaluating our situation and our attitudes–and as a result fall short of our goals.  By establishing a financial foundation first, you get a better idea of your good and bad habits, and the areas in your finances that need immediate attention; this leads to setting the right goals and the steps to tackle these issues.

This first step in setting a financial foundations is to understand yourself.

1. Be mindful.  In yoga, we’re aways reminded to be mindful of things.  “Be mindful of your breath.” “Be mindful of thoughts for they turn into actions which turns into the truth yadda yadda.” “Be mindful that you don’t scrunch your neck in downward dog.”

I am very mindful of this beautiful sunset.

I am very mindful of this beautiful sunset.

These are small reminders that can be extremely important to the practice of yoga and to receiving the full benefits of a pose.  When it comes to money, we should also be mindful of our actions and reactions to money-related matters.  How do you feel when you get your credit card bill in the mail? Do you instantly cringe and throw the bill in a  desk drawer, only to be found sometime in mid-August?  Or do you react in the opposite way, panicked by a fear of debt, spend your whole paycheck on bills and leave yourself with a twenty-dollar bill for the rest of the month?

What is your current state of debt?  What is your monthly income?  What are your fixed expenses that you need to live on per month?  Find these numbers and memorize them.

2. Change your attitude.  Many people approach money issues with a sense of fear.  I’ve heard people complain that they don’t understand finance, it’s complicated or boring.  Others don’t want to delve too far into their finances for fear that they’ll discover how majorly dramatically horrifically in debt they are (which is probably not the case).  Still others may think they don’t have anything to worry about because they’re too young, don’t earn enough money, or have someone else make money and investing decisions for them, etc.

First of all, take a good hard look in the mirror and acknowledge how you feel about money, debt, retirement planning and investing.  Are you afraid to ask questions at the bank, or talk to a financial advisor because you feel like you don’t make enough for someone to care about your questions or accounts, or because you don’t want them to think you’re stupid or because you don’t want them to sell you something?  My advice: walk into the bank like a gangster.  Act like you own the place.  Look at the bank advisors like they work for YOU.  I mean, they don’t, but if that’s what it takes to get you to change your attitude, tell yourself those lies!

Think of yourself as the Godfather and your financial advisor as your trusted Consigliere.

Think of yourself as the Godfather and your financial advisor as your trusted Consigliere.

The opposite of fear is confidence.  It is incredibly empowering when you can overcome your fear–or maybe even just ignore it or side-line it–in order to start a conversation with an advisor, ask questions and take control of your money (and not the other way around).

3. Create a process that works for you.  Let me start by saying that I hate math.  Anything that has to do with numbers–even the calculator on my Iphone–is extremely puzzling to me.  I am often stumped when someone asks me to times a number by 10.  So when it comes to establishing a budget and managing my finances I don’t use an Excel spreadsheet.  I like things spelled out, so I gravitate towards specialized programs like Mint.com, and I also like keeping good old-fashioned notes in a notebook (or on my Iphone).

Some couples use the envelope method to manage their household finances.  They stuff money into envelopes dedicated to certain parts of the household budget and anything left over from fixed expenses can be used for the variable expenses like entertainment, big purchase items or hair extensions.  I have a friend that lives and breathes Excel.  She uses Excel at work of course, to manage her household budget and bills but also to manage expenses on a group outing, for vacation expenses, even for shopping.

No one process works for every person; you have to find the method that is convenient, easy to use and something that you’ll stick to.  And then stick to it.

Establishing a financial foundation, like fitness, is a simple (sometimes painful) process that can lead to establishing the right goals.  Once you know “who” you are–with regard to your attitude, your fears and your habits towards money–you can set real goals based on that reality.

Your financial foundation can also be a great scare tactic that inspires you into action–kind of like what happened to me after my fitness test last week.  I was back at the gym every day this week, and even tried some exercises Tareeq showed me.  He would’ve been so proud if he saw me on that treadmill–but he was too busy flirting with a new member at the juice bar.