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Financial.

5 Money Makeovers

5 Money Makeovers

I’ve spent a while searching for the 5 greatest money makeovers of all time, and couldn’t find anything that would really make a difference. While there are hundreds of tips out there to save money: like pay your insurance annually, buy energy efficient appliances, stop shopping for shoes when you have over 100 pairs (ughhh). Most tips just leave me completely uninspired.

Here are a few things that I find are more inspiring and will help you live a better financial life (however, you may need to have a proper money mindset foundation, read my 5 Money Manifests – whether making money or spending it – having the proper money mindset is key.)

1. If you Have Debt, Stop Focusing on it! Don’t spend so much time worrying. I know what we focus on will expand in our lives – for the good or bad. If all you focus on is your debt problem, I believe it will just keep compounding problems in your life. Make a plan to get out of debt and then forget about it – that’s right – forggeddaboutit. Focus on the positives, new ways of increasing your income or new business ideas, and the other part of the equation will disappear.

2. Manage Impulse Shopping. Although, I will say for women, our idea of impulse shopping is like spending $100 on ourselves, whereas our male counterparts seem to impulse shop with high ticket items (boy toys are way more expensive (electronics, cars, watches, ATV’s, anything that goes fast – Do I hear an AMEN ladies?) Instant satisfaction is here to stay – it has always been and always will be part of our challenges as human beings in all parts of our lives. What instant satisfaction does is give us a quick surge of adrenaline, and a hangover of debt in some cases. Trust me, nothing is better than an impulse shopping trip, however, if we have the money for it, it’s always sweeter. (Remember, I said manage impulse shopping not eliminate it.)

3. Start Saving. Money Preferably. (If you’re like my grandma – used zip lock bags don’t count). Just start. I don’t care how much debt you have, you need to start saving and get into that habit. And before I get the smarty pants people tell me that it makes more sense to pay down debt accumulating at 19.99% than saving money which may only get a return of anywhere from 0.4% – 10%+, I say NO! This is why I say ‘SAVE’ before pay off high interest debt (or do both simultaneously). First, it gets you in the habit (and it’s paying yourself first). It’s showing to the universe (or your intentions) that you are wanting to get ahead. Second, you are OBLIGATED to pay your minimum payment anyways, so you will keep doing it to kingdom come because you actually care about your credit rating (if you didn’t – you wouldn’t even be reading this). You will pay down and re-spend every month. I do. It’s called life and you still need a credit card. Third, they aren’t gonna give you $100,000,000 credit card. At some point, they won’t keep increasing your credit (they can’t legally anyways unless you ask) when your debt ratio and income can’t support it. So, that means your credit card limits won’t be increasing at a rate as fast as your saving will. At the end of the day, if they don’t increase your credit card limits, and you have saved/invested money religiously for years, you will have way more in the way of assets than debt, and if you wanted to get rid of that credit card, you just cash out some investments and be on your way. (Yes, not the most brilliant/easiest plan – but hey there’s a million ways to get from A to B.)

4. Plan Ahead. Most people don’t have a plan at all – just get something down on paper. Writing has magical powers (so they say) – we tend to remember it better. I dare you to try it for a month, and write it down every day and tell me your results. Even though I do it, I’m horrible at doing things every day! So I need to do this too. Write down your goals, what you want to have accomplished, and put it out there – EVERY DAY. It will come back to you.

5. Give. Giving does more for you than it does for those receiving, plus it will come back to you in some form. There is a natural law of giving- we reap what we sow, cause and effect, and dynamic exchange. Giving doesn’t always have to be money. Give of your time to volunteer, coach, and teach. If you believe it doesn’t come back to you in some form – well you just made the world a better place to be. And those treasures are more important than any physical treasure you can build up on earth. Randy Alcorn in his wonderful book, The Treasure Principle says, “The only antidote for materialism is giving.”

“When all is said and done,” says author Og Mandino, “success without happiness is the worst kind of failure.” So, buy new zip lock bags if that makes you happy.

 

Coach.

5 Money Misconceptions

5 Money Misconceptions

Nothing I love more than talking to people about money – their beliefs around it, how they go about earning it, what they do with it when they have it and how their beliefs about money completely shape their life. Sometimes though, our money beliefs can negatively impact our lives, so I put together 5 common money misconceptions that I’ve seen over the years.

You probably have thought one of these at one time or another and maybe still hold it as a core belief. No matter where you are at, my hope is that you don’t let these misconceptions hold you back from the financial life you desire for yourself.

Misconception #1 – Money means financial security
Money will never equal financial security. There is no security in life; we know that, however we still like to ‘create’ security in our heads or back up plans. Being prepared as best we can and having a plan for potential likely scenarios that could play out in our lives is important, and part of our basic human needs for safety. Life, fortunately, keeps us from being prepared for everything. This is what makes life an exciting adventure. If we had ‘insurance’ for everything that goes wrong we’d be a world of actuaries, underwriters and claims departments.  I’m glad that’s not the case.

Misconception #2 – More money means less worry
Nope. In most cases it just means you have more to worry about or be obligated to. The trick is to not worry. Period. Worry doesn’t add one second to your life. More money sure doesn’t end worry, it just gives you new things to worry about. Being rich or poor has nothing to do with your worry factor. So stop worrying about money and get a plan in place to either make more money or use what money you are given more wisely.

Misconception #3 – I’ll get out of debt when I make more money
HA – you won’t – you’ll just buy a Rebecca Minkoff or Kate Spade! When I saw Preet Banerjee speak last year (author of ‘Stop Over-thinking Your Money‘ and TV host of Million Dollar Neighbourhood), he mentioned that for most people your expenses increase in step with your income. It’s true! As a planner and financial coach, I see this ALL the time.  More money for most people means more to spend.  The only way you will get out of debt is if you create a plan to get out of debt and then take the actionable steps to do so. (By the way – I think it’s great to spend money. My beliefs lie with one word: balance. Everything in balance. So spend away – just remember to save too!)

Misconception #4 – There is only so much money to go around 
Wealth is unlimited. Everyone can be as rich as they choose to be. Most people believe wealth and financial abundance is only for a small percentage of people. The truth is that money and wealth can be created. It’s not finite. The Richest Man in Babylon by George S. Clason is a classic you should read if you haven’t. In that book he talks about how something as simple as building a house creates wealth for all that are involved. It’s a fantastic illustration on how wealth can be created and multiplied (and I’m not talking about the FED printing money out of thin air – that just compounds the situation – good or bad).

Misconception #5 – Stock Market is risky
Carrie Schwab-Pomerantz, President of Charles Schwab Foundations says:
“Risk-averse millennials should remember that the stock market is ‘engineered to grow.’ Underlying the sometimes cryptic seeming graphics and streams of numbers that many people associate with the stock market are companies. Like you want your investment and money to grow, the people running those companies you are investing in want to grow too. Need more proof? From its 2007 high through its 2009 low the S&P 500 lost more than half of its value, but people who stuck with it would be up close to 20% from the peak by now.”

So define risk for yourself. Maybe the risk of not reaching your financial goals is greater than the risk of being invested in quality stocks or ETF’s. Everything is risky – even a GIC because it won’t meet your goals. You already know this – there are no guarantees in life. The dooms day stock market mentality has to go at some point (and usually comes and goes along with the economic cycle). GOOD NEWS THOUGH! We need each other (and the products and services we provide) to survive and live a full life – we are all on the same team. Increasing and advancing is built into us humans. SO, no matter where in the economic cycle we are – everything will be okay….. unless of course aliens come down to earth – then you are on your own my friend. 😉

 

Manifest.

5 Money Manifests

5 Money Manifests

When you hear the word MANIFEST do you picture some crazy voodoo lady with spunky hair, a magic wand and a mumu, who’s right off her rocker? I do! Well to be fair I come from a very conservative background where ‘crazy’ was defined as staying up till midnight playing dutch blitz (it’s a great card game, btw!) However, over the years and a plethora of books and courses later, I’ve fully embraced this crazy money magic called manifesting (and it really is money magic!)

So what does Manifesting and Money have to do with each other? Manifesting is just bringing forth into your world your thoughts and words. It’s just what’s going on in your head, your mindset, being revealed in your physical world. If you don’t believe in crazy hoo-doo huey-pooey magic, that’s totally okay, however I challenge you to be aware of the relationship you have with money. What’s crawling around in your head does manifest in your life in it’s many forms. Money Manifests have everything to do with your financial situation, whether you would like to admit it or not.

These 5 Money Mindsets you can MANIFEST in your life all come from one of my top 5 favorite books, The Dynamic Laws of Prosperity (read it!) by Catherine Ponder, a minister from Alabama in the 1960’s.

So I challenge you to read these and implement them in your life. I believe small changes to your money thinking will truly help you manifest your financial goals.

1. The golden rule of prosperous thinking is that you should not think or say anything concerning another’s financial affairs that you would not want to experience in your own. If you think of yourself as prosperous but of others as in financial lack, you are unconsciously inviting the same thing to happen to you.

2. Shop when you are in a good mood. Notice how much more you are able to purchase for your money when you are in a good mood. But if you shop in haste or while in low spirits, everything seems to go wrong, including the purchasing power of your money.

3. Appreciate your money. Stop thinking money is evil, or disregarding it by saying ‘Oh, it’s just money.’ When you begin to appreciate your money it will appreciate for you, rather than depreciate. Sounds silly, but talk nice about your money and to your money (If you are petting your money like a cat and saying things like “nice money, purrty purrty money” then best to keep that one to yourself, but hey – whatever floats your boat – no judgement here!) Cherish even the pennies on the ground.

4. Don’t send mixed messages. If you listen closely to the conversations of people about you, you will discover that this is a general attitude. People often discount the importance of money in one breath, and yet they admit that they are working very hard to get it in the next. They do not realize the cross-current they are setting up in their thinking, which in turn voids most of their efforts. Through such crossed-up thinking about money, they are working at cross-purposes, and often they will experience a crossed-up result.

5. Believe in success and prosperity for all. Never become disappointed, discouraged or upset by what others say or do in an effort to hold you down or take your good from you, as you begin to rise through prosperous thinking. In the long run, they cannot hurt you, only themselves. Instead, feel flattered when people try to hold you down or “down you” in any way. It’s a sure sign that at last you are succeeding and that others realize it.

Remember, there is more than enough to go around for everyone. Keep a mindset of abundance, not of scarcity or competition.

 

Create.

5-4-5 Money Magic

Money Magic

I’m starting a five week series called ‘Money Magic’.  5 weeks with 5 tips each week on how to create financial possibilities for your life.

  • 5 Money Manifests
  • 5 Money Misconceptions
  • 5 Money Makeovers
  • 5 Money Measurements
  • 5 Money Mindsets

See you next week!

Insurance.

Death By Dishwasher

Critical Illness

CRITICAL ILLNESS

Apparently, death by dishwasher has increased 100% since they invented the diswasher. Beware, those crazy dishes can pile up and wreak all sorts of trouble on your life, even relationships (specifically the marital type), sometimes resulting in an “accident”, disability or as already alluded to, death. What advice I’d like to give you is to avoid those pesky things all together, however, in life we know that dishes, taxes and death are certain, and for the most part unavoidable. Sadly, there is one more certainty to add to that list that will likely affect everyone at some point in their life: Critical Illness.

I’m not going to go into statistics, but everyone knows someone or multiple people in their life with a critical illness right now. And here’s the thing, most people do survive their critical illness, be it cancer, heart attack, stroke, etc. and for many years after go on to live completely normal lives. Life after a critical illness is becoming more common thanks to medical technology and health care advancements and fabulous support groups.

Critical Illness Insurance, I believe, is an important part of your financial portfolio (because I’ve seen it financially distress families many times). If it’s not in your portfolio, I really think you should take a serious look at it, regardless what age you are at!

Keep in mind, it’s probably not part of your benefits plan at work (if you are lucky to have one).  There are very few companies that do offer Critical Illness Insurance as part of their benefits, so make sure to read and know what your benefits cover.

There are even return of premium options (so you get your money back at age 75 for example) and although Critical Illness Insurance premiums are more expensive than Life Insurance, still typically less expensive than Disability Insurance.

But what I really want to tell you today is what Critical Illness Insurance really does for people. I’ve handed out a few critical illness claims myself (all to people under age 50 by the way!) and found it had a very positive effect on those families.

I think when handed a large lump sum of money when you are diagnosed with a critical illness is a mindset game changer – keep in mind, you can do whatever you want with this money (oooh, and I forgot to mention the best part: It’s TAX FREE!) I think it goes unsaid, but I know in my clients’ situation that there was no financial stress on the families during that difficult time, there were financial options available to them to go seek medical attention at the best places in the world if they wanted to, and they felt they were more in control of their situation, rather than having their situation control them. Plus, they didn’t dip into their life savings, and came out in remission financially unharmed years later.

I’m also a firm believer that a positive mindset will overcome anything. And when you have financial resources available to you to, you are less likely to get depressed or feel like a burden to others, because still one of the top reasons for divorce and depression is financial difficulty.

I could write a book about Critical Illness Insurance and why I’m so passionate about it (oh wait, I am….), but for today, just remember to stay clear the dishwasher, and if anyone in your family asks, just tell them I said so*.

*This advice is not real legal advice and should not be construed as legal advice. Liability for not doing dishes is at your own risk, and you should NOT not do dishes without first seeking legal and other professional marital advice. If you were injured as a result of not doing dishes or your life was otherwise negatively impacted by not doing dishes, you are advised expected to shrug it off and be more careful next time.

 

Invest.

Miss Piggy Rocks It!

DIY Investing

DIY INVESTING

Miss Piggy rocks it!  That girl gets it right every time.  Have you noticed how she doesn’t lift a finger, yet she totally always seems to kick-ass, have it all together and look hot while doing so? I think I discovered her dirty secret; she is not a DIYer.

I sure don’t want to do my own facial, waxing, taxes or dental cleaning.  For pete’s sake, I don’t even like doing my own cooking – because then I’m forced to eat it.  I do hire that stuff out and I’m way better for it.  Do the stuff in life you love; the energy boosters, not drainers.

Any true DIYer will tell the saving-a-buck-DIYers that it’s not cheap to be a DIYer in general.  Most DIYers are hobbyists; they enjoy doing their craft. If you want to be a DIY investor, it’s a lot of research, time invested in reading, learning the ins-n-outs, and the cost involved to pay for the top gurus to hand out investment advice; not to mention the cost on some of the great investment tools that are available online. And, truth be told, DIY investing can cost even more than what your advisor charges.  I know personally that some of the top gurus charge thousands for their investment newsletters per year – and so they should.

Ask anyone who ever took a stock tip from the office watercooler, or from your best friend’s dad’s cousin who divorced the Wolf of Wall Street. Ask them how it turned out!

Everyone who’s been around the block knows there is no such thing as get-rich-quick, without intentional planning and smart hard work.  In financial planning, there really is a thing called ‘the luck factor’, however, I will tell you from experience, luck befalls the folks who had a solid plan or goals in place and have been working steadily toward them.

My big point on DIY investing is this, if it isn’t your passion, hire it out.  If it is your passion, then totally do-it-yourself.  If you are trying to save a buck, and that’s your primary focus, then you may be better off putting your money under a mattress or hide it in your child’s messy bedroom – don’t worry – if it’s like my daughter’s room, your money will be safe – no one will ever find anything in that mess anyways!

Very VERY few people are true DIY investors; everyone gets info and advice from somewhere.  The question becomes, who are you getting your trusted investment advice from?  (Hey, I will be the first to tell you I get my investment advice from amazing experts, as do most advisors {very few do their own extensive research and portfolio managing}.  Trust me when I say, being a professional investor is a full time job for a team of people.)

At the end of the day, the advice you get from your Investment Advisor is usually worth a multiple of whatever investment fees you are paying for.  A 2010 study by Investment Funds Institute of Canada shows that people who work with financial advisors/planners have almost twice as many investible assets as investors who do not work with a financial professional.

I also find most investors get return CRAZY (or return comparingitus), which leads them to want to pursue the glamourized DIY world.  That seems to be all anyone ever talks about or cares about. Guess what! When it comes to investing, it’s not all about returns.  This is not about how much money you make, but how much money you keep!

When you go to the beach you need a large tote, not a clutch.  The clutch won’t hold shite. Point-in-purse, what you hold for investments is not even half as important as how you hold your investments, meaning the type of account it is held in and the tax consequences of that account.  Taxes will be a far bigger nemesis to you any day of the week than those of meager (but steady) returns.  Hence, why DIY gets more complicated if you have to learn the investment world AND also brush up on the tax code at night.  FUN!?!

So why not take a page from the amazing Miss Piggy – delegate some of the draining exhausting crap in your life (like all that financial stuff) and go kick it in areas of life that you love and leave you inspired and full of life.

 

Invest.

Red or White?

Investment Fees

INVESTMENT FEES : BUNDLED OR DIRECT?

Life is full of choices.  Some way harder than others. Like Red or White? That seems to be the hardest question I’ve had to ask myself this week while on holidays.  A good problem to have.  However, other choices in life pop up – like should I choose bundled or direct investment fees when dealing with an investment advisor and these can be way more perplexing.

I think this will become a more pressing topic next year as investment fees will be brought to the forefront for all Canadian accounts with the upcoming mandatory investment fee disclosure to be front and center on everyone’s statements next summer (read my last weeks post on investment fees and CRM2).

I went searching through one of the investment firms that I use and found this amazing 3 1/2 minute video that illustrates this point better than I can.

At the end of the day – wine is wine, fees are fees, it really doesn’t matter which way you go (desired outcome will suffice)… and I’ll explain lots of that next week when I talk about the cost of being a do-it-yourself investor.

 

 

* Ipsos Reid Canadian Financial Monitor, IFIC 2010: The Value of Advice Report
Video courtesy of Vision Financial Solutions and Invesco

 

Invest.

Transparency is Always Good

Investment Fees

INVESTMENT FEES & CRM2

I’m a huge fan of transparency…..always good to know all pertinent information upfront to make an informed decision. 😉

No one likes being kept in the dark (although I’m a huge fan of dim lighting and its effect on the aging process)!

And now you won’t be kept in the dark when it comes to the fees you are paying in your investment account.

Here’s the deal: As of next year, July 2016, every statement you receive will disclose all your management investment fees, administration costs, commissions paid front and center on all statements. In the industry we are calling it CRM2 (Client Relationship Model Phase 2 amendments to NI 21-103) and the Canadian Securities Administrators (CSA) to enforce it among all investment dealers across Canada.

This most likely includes you, considering 4.6 Million households as of 2010 (or over 10 Million Canadians) hold mutual funds or equities in one form or another.

Trust me when I say, this is a good thing for you, the client. Transparency is always a good thing.

However, you may be surprised by the ‘sticker shock’ of this – warning: investment fees listed on your statements may appear higher than my 7-year-old on laughing gas at the dentist this week.

What you need to know is that the investment fees are not changing. However, the way in which they are presented to you is. It may appear that fees have increased or are changing simply changing because they will be bold and in your face, whereas before they were simply dealt with behind the scenes, talked about once and for the most part forgotten about.

It’s also important to note that investment fees have always been disclosed in the prospectus given to you when you purchased the mutual funds or other investments originally.

Also, it’s essential to know that your advisor doesn’t keep all that money. The pie gets split by many different hands; similar to realtor fees.

I think the more I live, I learn first hand; you always get what you pay for. Same goes for the value of investment advice. Even if it ‘feels’ you aren’t getting any value, there is lots going on everyday behind the scenes to bring you your investment.  And at the end of the day, there’s no free lunch when it comes to our capital markets.

In the end, you may be shocked to find out what’s behind the sheets (…of paper), just be glad you now get all information upfront and can go forward and make informed decisions.

The Value of Investment Advice by Ellements Group

 

Insurance.

Bite the Bullet

Insurability

INSURABILITY

Ever been to Costco and said you were going to ‘grab it later’ although to realize later it wasn’t there – like I’ve done 100 times.

Enter: The World of Insurability.

Insurability, in Lisa terms, is an insurance company’s opinion of you, your health, lifestyle and family history at a certain point in time, typically when applying for insurance.

Here’s the thing. When applying for Individual Health, Critical Illness, Disability or Life Insurance you NEED to get it while you are healthy. It’s this crazy thing where insurance companies don’t want to take on your smoking, drinking, diabetic deep fried Oreo habits (all the things that make for a great, GREAT stampede week!)……I think it has something to do with their business model emphasizing profits.

I had a client call me yesterday. He told me he just had a stroke and in the next breath mentioned how glad he was to have purchased his life insurance last year (and I have hundreds of stories like this). It’s so important because you just don’t know what tomorrow brings, and you have the power to take simple planning steps today. The only thing any of my clients who have had living benefits claims say the same thing; they wished they had more insurance.

So, what do you do? Get your insurance while you are young and healthy and apply preferably before Stampede.

If you are uninsurable, there are policies available, however premiums are higher.

Find an insurance broker/agent/advisor who specializes in traditional underwriting (the kind where you have to take medical tests and have a nurse come over – preferable if you are in good health) or non-traditional underwriting (policies that only ask you healthy questions and base underwriting decisions instantly on your answers). The non-traditional insurance market offers insurance products for EVERYONE…although again higher premiums and smaller payouts, however most people don’t even know that’s an option AND most insurance brokers don’t either!

Lucky for you I specialize in both. I can answer any of your ‘boring’ insurance questions. Leave a comment below or email me. I slept with an insurance textbook under my pillow for 15 years.

You never know what tomorrow holds for you and your family. I still laugh when people say, ‘well my parents lived to 100 kicking and healthy’. If that’s the story that keeps you warm at night, then I wish you sweet dreams. Reality is this….

49. That is the AVERAGE age of all Critical Illness claims in Canada (yes, average meaning half younger and half older)
56. That is the AVERAGE age of widowhood in Canada (meaning your man should not be your retirement plan).

So, do yourself a solid and get a few million dollars of life insurance on good ol’ hubby, because that story will keep you warm at night. When God takes hubby he will leave behind a Golden Gucci Purse to cuddle with.

I poke fun, but bear with me and forgive my lame-lisa-humour; I sell life insurance for a living.

What I mean to say is this. You may not die tomorrow but your insurability might, so get the proper coverage today while you are healthy.

So why not bite the bullet, before it bites you (or your husband and secure your Golden Gucci today!)

Estate.

Get the Last Word

Will

WILLS & ESTATE PLANNING

Truth be told, I’m partial to my romantic comedies although every now and then I’ve always liked a little gun fight, the odd car chase, or even the Terminator. He always did threaten he’d be back….. (this week in a movie theater near you)

Well, here’s the thing (spoiler alert!), unlike the Terminator, in real life when we die, we are dead. We are not coming back (GASP!)…….yet, it keeps taking thousands by surprise every year.

What’s even more shocking is how many Canadian die without a will, or die intestate.

56% of Canadians do not have a will according to a 2012 survey by LAWPRO.

A will is the foundation of a good financial plan. Not only because you get to direct how your assets are distributed, but if forces self-reflection and one of my favorite planning principles Stephen Covey made famous, ‘begin with the end in mind’. Knowing what we are building, getting clear and painting that picture also helps propel us towards our goals. There are intestacy provisions which vary from province to province, however they probably won’t reflect the true wishes of most individuals and especially if you fall into any of these categories:

– if you wish your spouse to receive your entire estate
– in your second marriage
– in common-law relationship
– in same-sex relationship
– you have children from a previous marriage or born outside of marriage
– you have a child with special or circumstances
– you do not want a public trustee or government managing assets for your minor children
– you don’t want your kids to get their hands on all that money at age 18 or 19
– if you wish to do any tax planning whatsoever
– if you wish to leave any money to charity
– if you wish to appoint guardians for your minor children (and you def don’t want crazy Auntie B doing that!)
– if you wish to grant extended powers to your executor
– if you wish to establish trusts for your loved ones (so Johnny Jr. doesn’t get a $100K sports car at age 18)
– if you wish to leave money to your favorite financial coach …. (PM me for my banking details 😉 )

and finally

you need to have a will…

because who doesn’t want to have the last word.