MoneyMinding Monitor

I’m sooooo grateful for the support of my amazing husband with this project because for years – yes years - there has been a task allocated to administration that has been cluttering up my peace of mind. Tonight we sat down and looked at how long it would take to complete and what exactly was involved so we could get the help necessary to get the job done. Well, several hours later, we had enjoyed some quality time together including some nice chardonnay and the result is that a huge volume of material that has been sitting in mVillage (the MoneyMinding Membership community) that wasn’t easily searchable now is! This is still just the beginning of information that is currently available, just not picked up by the ‘search’ function. Well, for mVillage members, you can select your financial area of interest in the ‘search bar’ and all this content and waaaaay more is summarized for you.

In one evening we were able to enjoy quality time together AND provide huge value to our subscribers. If you’re currently an mVillage member, then I encourage you to enjoy the ease of use you now have in accessing this valuable information. And, if you’re not already a member, then the easiest way to get started is with The Death by Money Report available at www.deathbymoney.com. When you order the report you receive 30 days of unlimited mVillage access that is normally $19 a month.

You can access this information easier now AND you can ask questions and comment on the information with your anonymous login! That means you don’t have to be intimidated by asking a question you think maybe you already should know the answer to. Remember the only bad question is the one not asked! Enjoy! And, hopefully some of this will also help you create some giant ‘check marks’ in your life as well as help you get financial results you didn’t know were possible!

Uncovering Potentially Misleading Financial Advice - Overview
IMMEDIATE RELIEF FOR FINANCIAL STRESS
HEALTHY ECONOMICS
THE SIMPLE WAY TO INCREASE YOUR RETURN
Solving the Mysterious Case of Illusive Income
WHY GETTING OUT OF DEBT IS NOT ENOUGH
KEY STEPS IN PREPARING FOR RETIREMENT
Why We Need to Love Insurance
Who’s Fault is it Anyways?
Owning Your First Home
Managing Conflict of Interest in Financial Services
Narrow-minded View of Financial Literacy will Create More Problems than Solution
Is Lack of Financial Education Costing You?
Regulate or Educate?
The Real Reason “Not Spending” Doesn’t Work
What to Do When You Don’t Know What to Do?
Why Cutting Back Your Spending Will Lead to Failure
Confessions of a Shopaholic: Reviews Miss the Opportunity
Misconceptions About Multi-Millionaires and Their Money
Obama’s Paradigm Shift Won’t come from Old Teaching
Reasoned Responses to Radical Money Situations
What is ‘Risk Tolerance’ Really?
The Richness of Giving
Are You Up or Down?
When Conventional Advice on Money Won’t Do
Financial Turmoil ~ Doing the Right Thing for You
Navigating the Early Days of Credit
How to Turn Money Worry into Success
What Will You Splurge On?
Money - Taboo Topic or Compelling Conversation?
The Many Meanings of D.E.B.T.
The Enjoyable Road to Debt Freedom
Money Management is More than
The Entitlement Epidemic: Eroding Our Financial Future
Saving Money Will Keep You Broke
Buying A Car: A Personal Story of Lessons Learned
3 Simple Principles of Financial Decision Making
How to Get Out of Debt and Save Money at the Same Time
How to Stay Calm When Your Money is at Stake
5 Simple Changes You Should Make to Your Money Priorities
The Missing Piece in Financial Planning for Advisors
The Missing Piece in Financial Planning for Clients
What is Your Professional Title?
Treasure Hunting
Your Clients’ Financial Comfort Zone
Accepting Financial Advice
A Built In Negative Return: Secure Investments?
A Guaranteed Investment
How to Save for Retirement While Still Enjoying Today
A New Definition of Retirement
Financial Advisor or Scam Artist?
Grandma’s Lessons in Financial Management
How Are Your Spending Habits?
How Giving Has Blessed Our Life
How to Build, Manage, Maintain Wealth
How to Buy Your Dream Home
How to Make Financial Decisions
How to Retire When You Want with the Money You Want
Lucky Financial Planning
My Portfolio is Down - What Now?
No More Restricted Spending
Special Financial Strategies for the Younger Generation
The Lure of Low Interest Rates
Treat Yourself to a $1000 Spending Spree
What is the Price of your Lifestyle
What Really Happens When Rates Go Up?
What Type of Life Insurance is the Best?
Who’s Minding Your Money?
Is Insurance an Investment or Expense?
Confirming What You Understand

There is no doubt that with, or without money, it’s a topic that causes uncertainty today. In many cases, money anxiety can lead to divorce, illness, investment loss, business failure, family turmoil, and a life unlived! The solution to financial issues, however, is a paradigm shift away from conventional wisdom that promotes ‘spend less than you earn, get out of debt and, save more for retirement’. This is outdated information that is actually fuelling the problems!

My newest resource called The Death by Money Report, the causes of money stress and how a $10 solution can save your financial life is available online and I want to make sure you have access to it right away. This timely information will challenge your thinking about money, yet provide immediately simple and helpful insights that anyone can implement into their life today – regardless of their current financial situation.

The Death by Money Report presents a powerful argument that introduces a whole new way of thinking about your finances in a way that creates opportunities to earn income that you didn’t know existed. The report also provides an action plan for the practical application in the real-world for the concepts it introduces. This isn’t just theory, this is about making positive steps that have the ability to change your situation (whatever that might be) right away!

To learn more about the report and the causes of money stress and how a $10 solution can solve debt and retirement issues by spending, not saving visit www.deathbymoney.com. It’s well worth your $10 investment for the purchase.

To your success,
Tracy

PS – For a limited time only during this initial launch, when you purchase The Death by Money Report, you will also receive a special report on finding and working with Financial Professionals. This is an additional $10 value, included free with your report to help you work efficiently and effectively with financial professionals who share your values for earning, and managing your money. It’s available when you order from www.deathbymoney.com.

PPS – If you want to be part of a movement that helps others experience financial independence in a fresh new way, please share this message with others and ‘like’ it online. Young, old, rich and poor, we all benefit when money is working for us, not the other way around!

Contrary to conventional wisdom, financial freedom doesn’t happen when you have no debt. In fact, the road to debt freedom and the process of maintaining it will actually halt your progress. That’s not to say that you should run out and rack up your credit cards and abandon your debt – that’s just irresponsible. It’s to say that the missing key to financial success; to reducing financial uncertainty; to experiencing financial peace – doesn’t happen when you have no debt.

When you have access to credit you have access to an incredibly powerful wealth building tool. If you use it incorrectly, you don’t get the results you’re looking for. When you appreciate it for what it can do, and you take the time to know how to use it effectively, you can experience its full potential in ways you didn’t previously know existed or were too fearful to act on.

The problem is that this powerful tool called credit has been provided easily without adequate instructions. Sure, there are the basic operations such as how to make purchases and payments, and what the interest charges are and the consequences of not making payments. These are the just the basics. Unfortunately because the more advanced operational instructions haven’t been taught, or have been misused, we have millions of people using the tool who don’t even know that they don’t know that there are better ways of using what they already have.

Think about it. Do wealthy billionaire tycoons like Donald Trump make financial decisions about how to pay off the mortgages on their skyscrapers? Not likely. They have learned to use credit to acquire an asset that creates income which pays for the expenses of the building as well as the credit that was used to make the purchase in the first place.

The bigger problem we have with this focus on getting out of debt is that far too many people have been given access to credit and have used it to acquire the lifestyle they want, rather than using it to earn that lifestyle. They know how to work for a living and how to access credit, but then they listen to scarcity minded teachers who haven’t fully grasped the concept of how our economy operates. For some strange reason, many people seem to think that by taking money out of the economy by stopping spending so they can get rid of debt that they have been told is ‘bad’ that somehow they’re going to be able to live happily ever after. This is partly because they haven’t received the proper instructions on how to maximize the tool they have in the form of credit but also because they have lost the ability to understand how to create income.

Haven’t we heard from some great success teachers about the concept of ‘what you focus on expands’? If you focus on what you don’t want then aren’t you really telling yourself that you’re not worthy of the desires you have been acquiring with this tool called credit? Does negative reinforcement really inspire confidence to learn and to develop new skills? Does cutting back and denying your interests ultimately help you learn how much money you really want to earn so you can live the lifestyle you really want to live?

When you focus on getting out of debt you are actually reinforcing lack, scarcity, fear and unworthiness. Sure, some non-deductible debt with high interest rates is better gone – but the way to get rid of it is to focus on creating income. You have to find ways to earn the lifestyle you desire, rather than acquiring it with plastic cards. And when you can master that skill, the income will be sufficient to look after the debt and your desires, and then we can all live happily ever after!

Here is some of the feedback and quesitons from the Small Change Financial Expo where I delivered the following workshops in Victoria:
1. Preparing a Budget that Makes You Money
2. Teaching Your Kids About Money
3. The $10 Solution to Saving Your Financial Life

 Loved it, best one from Friday and Saturday. ~ Carleen
 I was interested to hear how to build a plan and impart that to kids. I found the drawer technique helpful. ~ Aidan
 Very good. A different way of thinking about money. ~ Sue
 A very motivational speech. ~ Philip
 Great chat. Keep up the good work. You’re doing a good thing. Thank you. ~ Brian
 As someone currently contemplating entrepeneurship I found your workshop inspiring. ~ Laura

Questions:
 If you borrow money from the bank to purchase an investment and the loan is ongoing year after year, can you deduct for taxes the loan every year?
o Yes, but…These questions are always best answered by your tax professional. And, it’s not the loan that get’s deducted, it’s the interest and … this question and how it’s worded leaves me to wonder if this is an appropriate strategy for the level of financial experience the person asking the question has. A leveraged loan is a more advanced strategy, combining MoneyMinding steps 9 – 12. I would certainly suggest you discuss the strategy with your accountant, and a financial professional who will look at your financial situation from a holistic perspective, not one of ‘how can you get a quick fix’. Make sure you check out more like this and find out more about the strategy and what’s good and what to look out for in the MoneyMinding membership area, mVillage. It’s free for 30 days with the purchase of a Death by Money Report at www.deathbymoney.com

 Limitless exponential growth is obviously impossible in a finite world but your theory seems to be based on this concept. Please explain.
o The concept of doubling your money is one aspect of a 3 part plan that includes learning and implementing a solid financial foundation, overlaying that with specific measurable and scalable income goals that start at $10 and double each month for a year. After the year, the objective is to have a foundation, the income and a plan for sustainable income in whatever amount has been determined in the ideal budgeting, cash flow forecasting, and planning components of the year long plan. The plan is to create income that is measurable, manageable, scalable, and maintainable. I do this as a group program called ‘Project M’ if you’re interested. It’s also something you can get the overview of in The Death by Money Report, Wealth Secrets of Everyday Spending, or the MoneyMinding Makeover – and actually in most of the resources available from MoneyMinding. It’s exponential to however large you want it to be as long as it’s implemented with a solid foundation that works for real-life money management and how you want to live your life.

 What’s the difference between maximizing your investments and return on investment?
o I have written several articles and blog posts on this topic as well as answered the question a few different ways. These are all available inside the mVillage member area, but essentially the difference between return on investment and rate of return is that one provides for an ongoing benefit whereas the rate of return is about amassing some amount at the end of the period of investment.
o For example, $10,000 x 10% = $11,000 at the end of a year. But, $10,000 invested to provide $100 per month provides a far greater benefit both in the short and long term.

 Is to make money investing in companies a smart way to go?
o That depends. When you’re ready and have implemented a solid foundation following the 12 steps of MoneyMinding, by the time you reach step 10 and are investing in assets to provide income, income stocks (which are shares representing ownership in a company) are an option. Investing in stocks is also a good option for step 11 and 12 as well. To have a sustainable, solid plan, you have to have the foundation first though. You can find out more by searching on ‘investing’ and / or ‘sequence’ in the mVillage member area.

I don’t think I would surprise anyone if I shared that a top financial goal for most people is to own their own home. Imagine my horror at a financial advisor who specializes in insurance, explaining to a group of young families, how over a 5 year period they would be better off financially if they rented.

Emotions are what drives decisions, whether we want to admit it or not. The young people were attending the presentation because they wanted to know how to buy their first home. Unfortunately, as the presenter explained that the median price of a 3 bedroom home in the area was $530,000 and that a mortgage payment would be about $2500 per month, and rent would be $1700 for a similar home she was attempting to explain away a dream with simple math.

The explanation was that over a 5 year period by renting instead of owning, a family would actually be ahead $48,000 ($2500 minus $1700 x 60 months). Furthermore, because we are living in an uncertain economy she didn’t ‘feel’ that double digit growth was possible from the real estate market so that benefiting from capital appreciation from real estate was unlikely or perhaps only modest. No economic data for this view was presented, just like none was provided for the next explanation that was offered for why she ‘felt it made good financial sense to rent in today’s economy. She went on to explain that because employment was unstable and average incomes were barely able to cover a mortgage payment of $2500 a month that home ownership brought with it a lot of extra expenses and uncertainties that renting didn’t have. And of course, there would still be the issue of qualifying for the mortgage in the first place. She said she didn’t know where a young family would come up with the substantial down-payment and closing costs plus have enough qualifying income in the first place to even buy the house.

I was getting sick to my stomach listening to the groans and exasperated sighs from the audience. One man finally commented that it seemed impossible for anyone to own a home today. To which our financial advisor presenter responded that the real estate market had indeed changed with the economy and that if you rented and invested the $48,000 difference in savings from renting vs. owning, that you would not have had all the uncertainty of repairs and extra bills that come up with home ownership, that you wouldn’t have to worry about making mortgage payments if you lost your job, and that overall it made better economic sense (in her view) to rent.

Yikes!! She’s double talking and not knowing it, because on one hand she’s saying save $800 a month for 5 years with no return on your money you’d have $48,000, then on the other hand she’s saying it will be hard to come up with a down-payment for a $530,000 house, and on the other hand she’s saying invest the $800 difference from renting vs. owning, but she’s not shown an investment return on her math!
If you’re going to attempt to dissuade someone to give up on a very strong emotional dream, you better have some pretty strong emotional and logical arguments. You make money owning things. Also, when you own something you have options. You can rent, renovate, refinance and leverage for example. You can purchase insurance to cover risks to maintain peace of mind (the product our financial advisor sold and presumably wanted to earn a living from). You can partner with other people to make purchases. And down-payments don’t have to come from working and saving after tax dollars for years on end in savings accounts that don’t appreciate at the same rate as physical (real estate), or business assets (stocks).

Finally, the basic math used to explain the $48,000 that renting vs buying would ‘save you’ is flawed because it doesn’t consider the time value of money. In this example, using a $530,000 mortgage at 3.25% for 25 years (as our advisor did) you will find that the culmination of each of those $2500 mortgage payments over a 5 year period will reduce the outstanding mortgage balance by about $75,000. When you apply financial math to the monthly $800 savings that was supposed to be invested in the rent vs own scenario compared to the basic math example if all you did was earn the same percentage on your money as you would have been paying on the mortgage (3.25%) you’d actually have $52,000 at the end of 5 years. But, still not as good as the mortgage pay down situation. If real estate stayed fairly stable, from a math perspective owning definitely comes out ahead.

The question then is, “how can you buy the house”? We have already said there are strong emotional reasons for wanting to own: security, peace of mind, pride of ownership, flexibility, and math. And when you can support a dream with logic, you will start to explore possibilities to make it happen. There are many creative financing solutions available if you have a good mortgage broker to work with. There are certainly far better ways to come up with a down-payment than saving after-tax dollars on a monthly basis. And, creating income isn’t something that’s dependant on a job.

Overall, this narrow, ill-informed, out-dated opinion supports fear, lack, uncertainty and definitely not wealth creation or financial satisfaction. You can’t rationalize away a dream, especially when the numbers just don’t add up. Find someone who will help you brainstorm options and find solutions to help you realize your goals and dreams in a way that works for the way you want to live your life!

Author’s Note: The problem we have today is that too many people offer financial advice that continues to promote a dependent, fear-based, scarcity mentality. We need more financial professionals who understand that their expertise is to fulfill dreams, not kill them. This is part of the reason behind www.deathbymoney.com; to help people understand the cause of financial stress and to introduce a solution that can be implemented with as little as $10.

The concept for a Death
by Money book has been evolving for a few years, but the report is only a few
months old. It started with a few simple suggestions from people interested in
the story of the dramatic business fraud and betrayal and the powerful message
that situation illustrated.  The general
consensus was that the story needed to be told to help others avoid, minimize
exposure to, or recover from issues that cause financial stress.

The result of these
simple conversations is the new Death by Money Report:  How a $10 Solution can Save Your Financial
Life.  It is the culmination of
information from years of research, work and application plus a powerful story
of financial loss, survival and recovery.

Along the way, it is
definitely proving that the small things repeated consistently do produce the
biggest results in the shortest amount of time. And, that these small things
happen as we carry out real-life money transactions. The results aren’t from
major investments, business opportunities, or terrific rates on refinancing.
The real results are from earning and spending money on a day-to-day basis.
Lord knows, the results certainly don’t come over a 30 year period of scrimping
and saving and sacrificing long term! Yikes, who wants to wait a lifetime to
experience results and to support the causes you believe in?!

The Death by Money
project, as it has grown to be known as, is gaining followers and getting
people to think differently about their finances even as it was being written.
In an early version the report received reviews about how strongly the argument
was presented; how well articulated the message was; and how it really ‘got me
thinking about my situation and my retirement and what was really possible today’.

The ‘project’ has people
re-thinking their situation and asking different questions that take them on a
journey where they begin to see hopeful possibilities, rather than continuous
struggle, uncertainty and sacrifice because of financial restrictions or other
issues.  Money is becoming less of a
burden; less of a hindrance; and more of an interesting tool that can create a
beautiful canvas for a life of purpose and passion.

The Death by Money Report, and
everything that has come together to make it available for others to benefit
from its simple, yet powerful message, is what I will share with you going
forward.  In the meantime, the team of
people who have made (and who are still making) this project possible, have got
it to the point that you too, can begin to experience its incredible
message. 

You can now order the report and
the support to go with it at www.moneyminding.com for $10.  You
will find out how a $10 solution really can save your financial life or help
save the financial life of someone you love!

Abundant blessings,

Tracy (and my co-author, Lisa Maxwell)

For MoneyMinding Members you can follow along and ask questions and comment on the informaiton, stories, and concepts presented to help you identify potentially misleading or potentially catastrophic financial advice - and most importantly to be able to differentiate the good ones from the not-so-good ones.

You can login to mVillage at www.moneyminding.com to read them all, or become a Minute Manager Member to get your access. http://www.moneyminding.com/mm/store_courses.php

Just Pay More

… If nothing else, round your payments up, recommends Tracy Piercy, CFP and CEO of MoneyMinding.com. She says that when people have a payment for $644, they think of it as $650. Why not just pay $650, then? An extra $6 a month on a $200,000, 30-year loan can save you four payments at the end of the mortgage loan. …

When you pay extra, make sure the extra is applied to the principal balance, not just set aside for the next payment. And before you make extra payments, read your contract and make sure you won’t have to pay prepayment penalties.

Refinance With a Shorter-Term Mortgage

… To get the effect of a shorter-term mortgage without the risk, take out a 30-year loan, but make payments as if you had a 10- or 15-year loan. “You just make increased payments. You’re in control, not the bank,” Piercy says. …

Use Money Merge Accounts (The Australian Method)

…  there’s no magic formula for shifting your money around. “You don’t need software to do that,” Piercy says.

The biggest downside to the money merge plan is that it requires discipline. “You wouldn’t do it unless you understood cash management,” Piercy says.

Fox News
By Sally Herigstad
Published March 28, 2011
see the whole article here

A recent article titled Financial Literacy Key to Prosperity posted on advisor.ca by Vikram Barhat on November 16, 2010, shared some quotes worth sharing as they support the message we have been delivering for years – and, in fact, are the reason for the MoneyMinding Methodology, programs and business that has been developing since 1997.

“Financial literacy…could have a measurable impact on the economic output of Canada, said Donald Stewart, CEO, Sun Life Financial, speaking at the Distinguished Advisor Conference (DAC) 2010 in Orlando, Florida.”

“Stewart urged financial advisors to make financial education “more engaging” to ensure “the country understands, pursues and is receptive to the financial literacy lessons.”  (Sounds like the Minute Manager with mVillage to me).

“While stressing that financial literacy has to start at “the school level from coast to coast,” he asked advisors to lead from the front,  “Financial life is characterized by complexity and change and the role that you play in advising individuals is a very critical responsibility.” He admitted, though, that an advisor’s job is difficult and challenging, as it takes place in an environment of intensifying regulations and greater complexity.”  (That’s why MoneyMinding provides the expertise and third party service so this function can be hands off for the advisor who will be there to support the education, and to not divert their attention from the importance of delivering and maintaining the products and services necessary to fulfill on the financial plans for their clients).

“Stewart particularly encouraged leveraging financial literacy in the family as a way to instill better financial skills in the next generation. Children imitate actions and behavior of their parents and “parents who demonstrate poor financial habits” are passing them on to their children, he said.

“Parents need to acquire the skills and knowledge that their children will acquire so that they can reinforce what should become a lifelong learning process,” said Stewart. “If you improve the financial life of a parent you’d be making a key difference to the children and so ultimately to all of our futures.”  (We’ve been supporting families, spouses, and whole generations with financial literacy for years – congratulations to those MoneyMinding Members who have recognized this and have taken action for positive change).

“One of the highlights of the assessment of the current state of financial literacy around the world is the importance of behavioral economics. “People behave in financial situations in a way that isn’t entirely economically rational,” said Stewart.  (Hallelujah – it’s not just about knowledge it’s the emotional confidence to make positive personal financial choices – hence, the MoneyMinding Methodology integrating financial literacy and behavioral finance).

“As elsewhere, Canadian financial landscape is changing and advisors need to keep up with it. “There is a big responsibility that goes with all this change, because if you don’t [participate] then you contribute to naysayers who don’t agree that financial advisors are making a huge difference to the lives of Canadians.”  (Again, I say thank you to the MoneyMinding Marketing Partners and Mentors who are part of the solution and not contributing to the problem!!)

“Economies are increasingly becoming synchronized as globalization continues to shrink the world. Now more than ever, advisors need to keep an eye on the highly linked events of today’s world. Stewart drew attention to the economic development of India and China to illustrate how changes in one part of the world can reverberate far and wide. “Keep aware of what is going on in these two major emerging economies, because it’s not something that we are unconnected from.” (And, globalization is one reason why MoneyMinding is universal in its content and not connected in any way to any country or geographical area.  The goal is to help strengthen the communication between advisors and clients with the financial literacy and behavioral finance programs). 

Recently, an article was published for financial professionals that presents some of what we have been saying for years. Here are my comments on some of the quotes from the article:

Early financial education helps make the distinction between learning a life skill and what should be left to the professionals. This is such a key quote because adults today have not formally been taught finance. They think they can, and should, do it themselves, which also devalues professional advice.

“Part of the problem is [that] the educators don’t necessarily have the skill set to be able to teach financial literacy in the way we are talking about.”

Financial knowledge needs to go beyond product knowledge to include fundamentals of financial planning, an area where the financial community can assist by providing teachers [with] professional learning opportunities and resources.

There’s a significant role for the planning community to play in “promoting learning opportunities through professional associations and federations for educators to enhance their financial knowledge and skills”. This is part of the niche MoneyMinding fills by providing tools and information to both the industry and their clients.

The push from the financial planning community serves a dual purpose: it brings people to advisors. “The majority of people who don’t go to advisors… don’t know what they don’t know.” Hey, this has been my line for years!

See the full article here