Minding Your Money 360 - Quick tips to manage your money for success

I got a note from Andy and he asked a simple question. Do I need life insurance? He said that suddenly lots of people were trying to sell him life insurance and he wasn’t sure he needed it but the pressure was starting to get to him and he was wondering if he was missing something and if he should get some life insurance.

So here’s my bottom line. You need life insurance if someone else depends on your income. This could be a spouse or partner, kids, your parents or others that you care for. Life insurance is for the living not to replace you but to help those you leave behind to keep living in your absence. So if you are single, and no one depends on or will miss your income, having enough insurance or investments to cover your final expenses is probably all you need.

But if you have a family or people who depend on you, you may need life insurance. So the next question becomes, how much? One of the best ways to decide how much life insurance you need is to determine exactly what it is you want to cover. So if you have a young family, you might want to have enough insurance to cover their growing up years and possibly college. If it’s just you and your partner, you might want to help cover their retirement. And so on. Any life insurance agent worth their salt can help you put a value on the various options you want to cover so you end up with the correct amount of insurance for you.

Bottom line…take a look at your situation and if it warrants life insurance, get it. And, if it doesn’t move on. Don’t let someone else pressure you into an important decision like this.

And, that’s the minute for today. Did you miss a minute? You can listen to them all again, along with my notes and resources at www.mindingyourmoney.org

Thanks for listening and as always remember that minding your money really is the path to a richer life!

It's Monday and I have a question. And my question is this, What’s in your wallet? I’m serious. Your task this week is to look in your wallet and pull out all of the credit cards. Next, add up all of the balances on your credit cards, take a look at the interest rate and if you carry a balance, calculate how much you pay in interest each month and write that number down.

Sometimes when I work with people, they tell me that don’t have any money to save or invest and I have them go back and look at the number they wrote down above – they amount they pay in interest each month. If that number is $20 or more – those could be your savings dollars. While $20 dollars doesn’t sound like much, my goal is to build your savings muscle and once activated, it can grow and it is the growth that leads you to find more dollars and more ways to save. It doesn’t take a lot to get started – to pick up a new habit, but you do need something to prime the pump.

So here’s my question again. What’s in your wallet?

And, that’s the minute for today. June is coming and so is my money makeover challenge. If you want to get your money life in order this could be the ticket for you. Visit www.psworth.com and click on the red button for more info.

Thanks for listening and as always remember that minding your money really is the path to a richer life!

It’s Friday and time for our word of the week –the word this week is Social Security.

I chose Social Security because I’m getting a lot of questions about it but also because it can be an important part of your retirement plan. Here are some important notes to consider regarding Social Security:

Even if retirement is into the future, pay attention to those benefit statements that come about every year. Check them to be sure they are accurate. Mistakes can cost you a lot of money.

Decide when you want to start receiving benefits early on. At age 62, you will receive a reduced benefit and in general it takes about 13 years before it would have been better for you to wait until your full retirement age to take your benefits. So why take them early? You might need the money. If the life expectancy is short in your family – that might be a good option for you or if you don’t really need it, you can take it and use it for leisure activities.

Many people are opting today to wait until age 70 to take their benefits to get the maximum amount of money and they are also continuing to work. Keep in mind that if you have a traditional IRA, you will need to start to take money out – your required minimum distribution. The combination of Social Security, wages and money from your investments can push up your tax bracket and your tax bill.

Our word of the week Social Security. It’s a great benefit, but there’s a lot to know and not taking the time to get all the facts can cost you big time.

And that’s the minute for today. Like the Minute? Subscribe to it and leave us a review on iTunes or your favorite site so you never miss an episode.

Thanks for listening and as always remember that minding your money really is the path to a richer life!

While it’s difficult to live on Social Security alone, it can sure help in retirement. So Porsha asks, “Can I collect my ex’s Social Security?” She said that she recently got divorced and she totally forgot to ask about Social Security and she will turn 62 in five years.

Now that’s a good question and here’s my answer…it depends. And, here are five things it depends on:

Whether or not you spouse is eligible for Social Security. Not everyone is.

How long you were married. You must have been married at least 10 years. Heartbreaking true story, one woman’s divorce was final one-week before their 10-year anniversary and that locked her out of ever receiving any of her ex’s Social Security.

You are age 62 or older.

You have not remarried.

The benefit you are entitled to receive based on your own work is less than one-half of your ex-spouse's benefit.

If all that is true, you may be entitled to up to one-half of your ex's full retirement benefit, regardless of when they decide to take Social Security or if they remarry. On a final note: if you take your ex’s benefit at age 62 versus waiting for your full retirement age which in many cases is 66 – the benefit will be permanently reduced.

And, that’s the minute for today. Got a divorce question? You can find answers to questions like the one I answered today plus 128 others in my new book, How to Get Divorced Without Losing Your Blouse. Get your copy on my website (www.psworth.com/shop), Amazon or other bookstores.

Thanks for listening and as always remember that minding your money really is the path to a richer life!

Does your spending align with your goals? I got a question from a listener who said he always seems to run out of money before he has a chance to save anything and he’s puzzled because he said he makes a decent living – he says not a lot a money but a decent living.

If you have listened to the ‘Minute’ for any time, you’ve probably heard me talk about paying yourself first and if necessary making out a bill to pay yourself and putting it on top of your other bills.

But here’s another way to think about that and that is to look at your spending in terms of your goals. In other words, is your spending in alignment with your goals? A couple of things have to happen for you to answer this question. First, you have to have goals – that is you need to know what is important to you and what you want to achieve. Once you get passed that, you have to have a way to track where your money is going and that might be some type of budget or tracking mechanism that shows you what’s coming in, what’s going out and, more importantly, where it’s going.

And, here’s where I’m going with all of this – if you have money (a decent living) and you are running out of money before you get to save – your spending is probably out of alignment with your goals because if one of your goals was to save for something specifically, something that you really cared about, then it would be easier to match your spending with your goals because it would be easier to say ‘NO’ to things that move you closer to it and ‘YES’ to the things that do.

And that’s the minute for today.

Do you have a master plan for your financial life? A roadmap that reveals the next steps for your take to get to where you want to go? If not, I invite you to learn sign up for the Money Makeover Challenge. One of the key pieces of the challenge is creating a master plan for your financial life so you know what to do next to get you to where you want to go. We have a Challenge bootcamp starting in June. Go to www.psworth.com and click on the red button for more info.                                                        

Thanks for listening and as always remember that minding your money really is the path to a richer life!

My new book is all about divorce. In fact, it’s called How to Get Divorced Without Losing Your Blouse. And it’s no secret that one of the leading causes of divorce is money issues. But did you also know that money can also have the opposite effect? In other words, that a strong money relationship can strengthen your relationships and if you are single they can have a positive effect. You see managing your money provides you with choices and it turns out that having choices very is liberating.

So here are three things that couples can do to strengthen their marriage and their relationship with money:

Talk about money – if you are just coming into the marriage or even if you have been there for awhile, talk about your assets and your debts.

Decide on your priorities as a couple. In other words, make some decisions about how you will spend and save your money. If necessary, take baby steps like deciding if you will have joint, separate or a combination of accounts especially for household expenses.

Know when to ask for help. Sometimes try as you may, you might be able to do it on your own. So get help. A financial advisor or other professional can sometimes help you get to where you want to go and save your marriage in the balance.

And, that takes me back to #1 – talk about money. We are all so different, how can you possibly expect to make your money lives work if you don’t know who or what you are dealing with.

And, that’s the minute for today. Did you miss a minute? You can listen to them all again, along with my notes and resources at www.mindingyourmoney.org

Thanks for listening and as always remember that minding your money really is the path to a richer life!

It's Monday and I have a question. And my question is this, if you could wake up tomorrow morning and change anything in your life, what would that be? Would you find that perfect person to spend your life with, would you leave the person you once thought was perfect but now you feel no longer is? Would you exchange your not so perfect job for a better one? Would you manage you money better, finally lose the weight, buy a house, spend more time with your family, etc. Think about it. What would you want to do? Once you have it, write it down. Next, figure out what it would take, what would you have to do to make that a reality. If you aren’t sure, do some research. Google is absolutely amazing. It’s rare that I can’t find the answer I’m looking for there. Then as a final step write down what’s stopping you?

Could the main thing that’s stopping you be procrastination? Procrastination is devious. It offers us the opportunity to talk ourselves out of stuff – I’m doing okay the way I am. I don’t really need that. To negotiate with ourselves and gives ourselves a raw deal by making excuses – it’s too hard, I don’t have the time, my friends will laugh at me or my friends won’t like me anymore. Or to delay it, today is just not good, maybe I’ll get started tomorrow.

Never underestimate the power of procrastination. But if you have the courage to beat it, you can literally change your life with one decision.

And, that’s the minute for today. June is coming and so is my money makeover challenge. If you want to get your money life in order this could be the ticket for you. Visit www.psworth.com and click on the red button for more info.

Thanks for listening and as always remember that minding your money really is the path to a richer life!

It’s Friday and time for our word of the week –the word this week is Risk vs Reward.

I chose risk vs reward because it’s a part of everything we do and this so true when it comes to investing. Risk and reward tend to go hand-in-hand. In other words, the more risk you take, the greater the reward or more aptly potential reward because in investing there are no guarantees. You can take on a tremendous amount of risk and we sometimes do without realizing it because we are so focused on the potential reward. The closet things we have to riskless investments are savings accounts or CDs but even they have risk because even though you might not lose any money because it’s guaranteed, in most cases you do not earn enough to outpace inflation and taxes so you are in essence, safely losing money.

So instead of focusing just on the risk and reward consider this when choosing investments:

What do you want your money to do? Different objectives will lead you to different types of investments. Are you looking to grow it? Do you need an income stream? Or are you looking for a safe place to park it?

When will you need it? You can generally afford to take more risk if you will need the money far into the future because you will have time to recover from the ups and downs in the market.

Your risk tolerance level. This is an internal measure of well you can tolerate the inevitable ups and downs in the market and still sleep at night. Some people have high risk tolerances and others not so much.

However, that being said, probably the biggest risk doing nothing.

Our word of the week risk vs reward. There is a relationship between them but rather than focus on them when investing, focus more on your goals.

And that’s the minute for today. Like the Minute? Subscribe and leave us a review on your favorite site so you never miss an episode.

Thanks for listening and as always remember that minding your money really is the path to a richer life!

How Much Have You Saved for Retirement? Wait…don’t answer that question. For many people, saving for retirement abruptly ended with the end of most company pensions. The introduction of 401(k)s has eased some of the problem, but for many, that’s not the answer as many have saved almost nothing for retirement typically less than one-years’ salary.

So, some of the states have gotten together to introduce something they call the Secure Choice Retirement Savings Plans that requires businesses with five or more employees to either offer their own 401(k) savings accounts or automatically sign up workers for state-run accounts.

Workers can opt out of the program if they choose, but once in it they must pay roughly 3 percent of their income into tax-preferred retirement accounts managed by the state. While employers may or may not choose to contribute to their workers’ accounts, the employee’s participation is risk free – with the state guaranteeing a minimum rate of return. Sounds, good right? It could be the answer for many people, especially those who are fearful or have few investing skills.

So, what’s the problem? The problem is your House and Senate. They are voting to block this – something that could be so beneficial to so many people – why or as we say in Hollywood – what’s my motivation? Well, you may have to look no further than Wall Street. According to Senator Mitch McConnell, "The [state programs] would provide government-run retirement plans with a competitive advantage over private-sector workplace plans." My response, if that is indeed the case, then this is a great opportunity for the private-sector to step up their game.

So, now for the big question, what can you do? If you can see the benefit to a program like this, call or write your Congress people and let them know how you feel. Like it or not, this is a government of the people and sometimes just voting is not enough – sometimes you need to take extra steps to make your voice heard and depending on how strongly you feel about keeping your options open for retirement – this could be one of those times.

And, that’s the minute for today. My new book is finally out!! Yeah!! It’s called How to Get Divorced Without Losing Your Blouse. Get your copy on my website (www.psworth.com/shop), Amazon or other bookstore. It pulls back the curtain on the process so you know what to expect and can be better prepared. And, it’s definitely one place where you really need to mind your money.

Thanks for listening and as always remember that minding your money really is the path to a richer life!

Link to resource article:

http://www.msn.com/en-us/money/retirement/how-the-government-is-making-it-harder-for-you-to-retire/ar-BBAXPAI?li=BBmkt5R&ocid=spartanntp

Paying yourself first is one of the most important elements of building wealth because it puts you at the top of the list of those to be paid. You have two primary ways to make money: you can work for it, or you can put it to work for you. And the sooner you put your money to work for you, the faster it can help you build wealth.

So what does paying yourself first really mean? It means that you do just that, pay yourself before you pay any of your other bills. And all it requires it that you set aside a specific dollar amount or a percentage of your earnings every time you get paid. These dollars can go directly into a retirement account at work, a savings account, an investment account, or an IRA. In the beginning, the vehicle is not as important as forming the habit of paying yourself first. Then once the habit is established, you can rely on your master plan to determine the best places to put your money.

Re-evaluate the amount you pay yourself each year and increase the amount as your pay increases or as you decrease your expenses. If you haven’t yet formed the habit of paying yourself first, there’s no time like the present to get started.

As John Rohn reminds us, “To be successful you don’t have to do extraordinary things.  Just do ordinary things extraordinarily well."

Do you have a master plan for your financial life? A roadmap that reveals the next steps for your take to get to where you want to go? If not, I invite you to learn sign up for the Money Makeover Challenge. One of the key pieces of the challenge is creating a master plan for your financial life so you know what to do next to get you to where you want to go.

And, that’s the minute for today. Like the Minute? If so subscribe and leave us a review on iTunes or your favorite site. I read each and every one of them and 5 stars would be spectacular!                                                        

Thanks for listening and as always remember that minding your money really is the path to a richer life!