I had the pleasure of speaking at the Securing Mi Financial Future on October 5th. I spoke about creating a vision for your life, conquering debt, increasing your savings, and building a legacy for your future. After I spoke, I sat and listened to the other speakers. Although I am a financial educator, I love to be a student as well, so I can learn more about how I can improve the financial health of my family and serve my Phenomenal Moms even more. Here are some highlights from the sessions:
Align Your Finances With Your Vision: Aisha Taylor
When you start your financial journey, you need to first:
- Identify your goals. Every financial plan starts with creating goals. When you set goals, make them SMART (Specific, Measurable, Actionable, Realistic, and Time-Bound).
- Conquer Debt. Debt will keep you in bondage and prevent you from doing the things that you want to do in life. For example, the average senior has about $73,000 in debt. That’s about $1,000/month in debt repayments alone depending on the interest rate of the debt and the time to pay off the debt! Think about how that money could be used. Also, be careful about co-signing because if the borrower defaults, then you are responsible for repaying.
- Get aggressive with saving. I know that conventional wisdom says save 3-6 months of expenses. However, I’m a bit more conservative and I say to save 6-9 months if you are a single mom. I have this philosophy because I started working during the Great Recession and I saw how people with “stable and good jobs” get laid off and were unable to secure employment for more than 6 months. As a result, they ran out of money and started losing their homes and their cars. Witnessing that shifted my mindset about just how much money you should have in an emergency fund, especially if you only have 1 income.
- Build a legacy. Our children look up to us, so it important to be a good role model and teach them great money habits. Building a legacy starts with us.
Financial Quick Checks: Mark Robinson
If you are going to move forward in your finances, you need to look at them. Ask yourself,
If you are going to move forward in your finances, you need to look at them. Ask yourself,
- Are you putting your family at risk because you don’t want to review your finances?
- There are 100 pennies in the dollar. Where are you putting all of the pennies?
At the end of the day, it isn’t just about you. It’s about the health of your entire family. Remember, good decisions and bad decisions are both compounded over time. Depending on your decisions, over time, these decisions can lead you to a good or bad position. Therefore, keep an eye on your financial metrics and ratios to see where you stand with your financial health. If you don’t problems can start, build, and then cascade.
Also, don’t be a passive or hands-off investor. You should always:
- Know what investments you own
- Know why you own them
- Know how your investments are doing
- Know what you are paying
Retirement Income Planning: AARP
Did you know that 20% of people age 55-64 have no retirement savings? Don’t put yourself in a position to have to rely on the government. Retire with dignity. Start thinking about retirement early. There are a few sites that can help you to understand your retirement and increase your savings:
Identity Theft Prevention: The Michigan Attorney General’s Office
Did you know that every 2 seconds an American’s identity is stolen? Identity theft is a huge problem because it impacts your credit, your money, and it can be expensive and time-consuming to fix. There are things that you can do to help to reduce your chances of identity theft.
- Review your credit quarterly. You are eligible to receive a free credit report annually from AnnualCreditReport.com from the 3 reporting bureaus. Instead of getting all of your credit reports at one time, request 1 credit report from one provider every 3 months. For example, request your Experian report in March, TransUnion in June, and your Equifax in September.
- Don’t make copies of important information on public machines because copiers have memory
- Make copies of important information and safeguard it so you can reference it if needed
- Before you sell a used electronic device, wipe the device (even video games) to prevent the next person from accessing your information.
- File your taxes early to help minimize tax return fraud
Also, don’t forget to protect you children from identity theft. If someone asks for your child’s social security number, then ask them why they need it.
Medical identity theft is on the rise because of the increasing cost of health care. Here are ways that you can minimize your risk of medical identity theft:
- Review your explanation of benefits statement to ensure that the charges are accurate and valid
- Shred the explanation of benefits statement to ensure that people cannot access your insurance information
- Remove personal information from the prescription bottles
- Be wary of people who ask for your social security and Medicare card, and never give out your Medicare identification
Investing For Retirement
People tend to remember the volatile swings of the stock market, which can make investing intimidating and scary. However, the long-term trend of the stock market has been up. Also, there have been more ups with the stock market than downs. Therefore, don’t be afraid of the market. Here are a few reasons why you need to invest in the stock market:
- Your gains will be larger when you invest in the stock market versus sitting on cash. The interest rate is very low. Your long-term return will be higher if you invest in the market
- Inflation will reduce your purchasing power. Therefore, you need to earn a return greater than inflation if you expect to have the same purchasing power. Cash and other low-risk investments do not, at a minimum, keep up with inflation.
If you do decide to invest, then here are some tips to maximize your investments:
- Understand your investments and who you are managing your money with. This is your money and you need to be knowledgeable.
- Start retirement savings early. Time is one of your biggest assets when it comes to retirement planning. If you start investing early, you can invest less over a longer period of time and have a bigger nest egg than if you invested more for less time.
- Consider tools that allow you to maximize your investments and your ability to pass on wealth. Consider a Stretch IRA which allows your to take distributions over time and across multiple generations.
Who Gets Grandma’s Yellow Pie Plate?
Have a plan for what happens to your stuff. Ironically, many of the family arguments and issues result over stuff and not the money. Here are ways that you can minimize the likelihood of family arguments, and also ensure that your stuff is given to the proper person.
- Make a will. There are two things that are guaranteed in this world: death and taxes. Making a will doesn’t mean that your life will be shorter. It just means that you are in control of your asset allocation after death.
- Make a list. List out your stuff, who you would like it to go to, the item’s significance, and why you chose to give it to that person.
- Ask people what they want, and write it down. The speaker gave an example of a couple who collected antiques. They just knew that their children would want to inherit the antiques. However, it turned out they didn’t value the antique collection, and they were more interested in different items. Instead of giving the antique collection to the family, the parents were able to gift the antiques to a museum instead.
- Make an identifying card. For sentimental pieces attach a card to the item so people understand the history and value of the item. The speaker mentioned a pair of binoculars that had been in the family for years. To an average person they would think that those were just an old pair of binoculars, however, those binoculars were used in World War I. Without the card, the value and meaning of the binoculars would have been lost.
- Be the one who makes the decision about your own stuff to minimize conflict. People are more likely to accept the allocation and fairness of the distribution if the gift giver determines it. Make sure that the list is referenced in the will, and that the list is kept with the will.
Hopefully, these tips will empower you to make some changes to your financial management. Don’t try to do everything at one time. Pick a topic, work through the recommendations, and then move on to the next one. Over time, you will make progress. Remember, this is a marathon and not a sprint!
Leave a comment in the Phenomenal Moms Facebook Group to let me know how this helps you!
Aisha Taylor is a single mom of twins, personal financial coach, work from home entrepreneur, and #1 Amazon Best Selling Author of the book “5+5 FNPhenomenal Ways to Save $100 This Week Without Killing Your Lifestyle.” Aisha has been featured in ESSENCE, Jet Magazine, and Black Enterprise. She is also the Founder of FNPhenomenal (Frugal –n- Phenomenal), a movement designed to help single moms transform their finances, enjoy life, and stop living from paycheck-to-paycheck. It’s time for you to be Financially Phenomenal!
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