Archive for the ‘Family Wealth’ Category

Grieving The Dream

Thursday, November 19th, 2009

This past week at Ali Brown’s Shine event, I had a big awareness during Anne McKevitt’s talk on branding.  Besides the fact that I found Anne to be totally off point for most of the women in the room, it suddenly hit me that I’ve let go of a big dream I’ve carried with me for a few years.    And I’m grieving it.

Anne was talking about building a worldwide brand.  Her message reminded me of what I once wanted to do.  And woke me up to the reality that I’ve let the dream slip away.

It’s funny how I didn’t realize it until that moment.  There was no point at which I said “that’s it, I can’t do it anymore.  I’m giving up on this dream.”  But, now looking back over the past year,  I notice this is the first real attention I’ve given it in several  months; it’s not something that will move itself forward on it’s own; and I want to spend more time with my kids now so I don’t see myself pushing it forward.  In fact, I’ve let go of a lot of things that require push.

I think I first started to let go of the dream when I was on the phone with one of my business/blogging/mommy role models, Penelope Trunk.  She must have been right in the middle of raising money for her company and unable to pay herself.   We had a brief conversation about two things I was working on: a reality show and writing the business plan to make this dream a reality.  She said I was crazy for wanting to raise money and develop a software program (a major component of the dream).  That I should do the reality show instead.

I wonder if she’d still say the same thing now that her company is at least partially funded.

Regardless, she was only reflecting back to me what I was already feeling.  I had spent two years on this big dream and I was tired. Exhausted really.  Feeling defeated.

I had just invested $15,000 and several months in a business plan that was not clearly capturing my vision and then I lost $10,000 to a couple of scam artists.  At the same time, the economic news was building to a frenzy and I realized I had an amazing business that was making a big difference for a lot of lawyers as it was and I needed to invest my energy in building the business I had rather than continuing to focus on the bigger vision.

I dreamed of making affordable access to a lifetime relationship with a lawyer™ readily available in every neighborhood of the US and Canada.  Think H&R Block or State Farm Insurance or Remax or TLC Laser Eye Care Centers.  But, for lawyers.

Every other profession – from accounting to insurance to medical to dental – has a centralized system the professional can plug into that is automated from soup to nuts so the professional can do what she does best and the managers can run everything from marketing to service fulfillment to membership management.

There is nothing like it for lawyers.  And, I was gonna be the one to build it.

The Personal Family Lawyer business I have built is a beautiful precursor.  Lawyers implementing my business model for attracting, engaging, servicing and retaining clients lawyers are transforming their practices.  They are moving beyond the failing, broken model and becoming trusted advisors to their clients. They are busier than ever, even in this shifting economy and making a real difference in their clients lives.

Just yesterday, I heard from a lawyer who joined our program to transition from a litigation practice that was turning him into someone he didn’t like into an estate planning lawyer who is making a positive impact in the world.  In his first month of seeing clients as a Personal Family Lawyer he has already engaged one client and has another 5 appointments on the books.  Unless you are a lawyer, you probably have no idea how amazing this is.

My systems work.  Sure, they’re not built on a centralized model like H&R Block, State Farm or Remax, and I’ve come to realize they may never be, but they are changing the world for the individual lawyers who are embracing a new way of being with their clients and grateful to have a proven business model for doing it.

I’ve gained new awareness about myself.  I’m an amazing coach, visionary, and communicator.  It turns out, I’m not so good at managing teams, hiring, negotiating, financials,  and all the other little detail things necessary to build a really big business.  I can do those things.  But, they drain my energy.  And they make me less good at what I’m really good at.   Plus, bottom line, they take time away from my kids and my writing and the self care that I need to be happy.

So, I’m grieving the dream.

At the same time, for perhaps the first time in my life as a business woman, I’m celebrating what I’ve built and discovering what it’s like to appreciate what I have without this intense, burning desire for more, more, more.

My business is built.  It brings in more than a million dollars a year and supports my family plus 6 of the most supportive, fantastic team members a girl could have.  I get to work from home, homeschool my kids and have started a secondary business coaching business owners who want what I’ve built with my honey.  We are making a huge impact in the lives of these lawyers and their clients as well as the business owners we coach.

I get to coach, write, and innovate.  It’s what I’ve dreamed about for so long and it’s all happening. My main job now is to continue to support the forward-thinking lawyers who have stepped out of their own comfort zones to adopt a new model of practice, keep innovating new campaigns to get the message out about what they are doing in the world and attract more lawyers who are ready for something better in their lives and their businesses and don’t want to have to reinvent the wheel to have it.

Really, what more could a girl ask for?

Sure, I’d love a ten (hundred) million dollar business.  And I’d love to be known as the woman who radically transformed the legal industry on a massive scale. And I believe I have the specialized knowledge to really do it right, but I simply will not do it at the expense of my family and my well-being.

My ego is pissed off that I’ve let go of the dream.  It wants to be seen as more than just a girl with a great business and a blog and a couple of kids.  But, that’s just further confirmation for me that letting go is the right thing for me to do.  I refuse to let some idea of what I should do an what I should be run my life anymore.

And even with all that, I’m still grieving the dream.

Contrary Advice: Don’t Pay Off Your Debt!

Thursday, December 18th, 2008

I’ve got to tell you, I’m a little bit sick and tired of the traditional personal finance advice out there that is telling you to pay off your debt and pay down your mortgage.
Insisting that you’ll experience financial freedom when you’ve got 6 months savings in the bank, no one you owe money to and you’re on your way to a relaxing retirement.

That’s all well and good, but it’s also not entirely true.

It’s not true in two regards: 

1) You don’t have to wait until you’ve got 6 months savings and no debt to experience financial freedom.  You can experience financial freedom right now.
2) Paying off your mortgage and all your debt could actually be harmful to your financial well-being, especially right now.

Now, that second statement is a big one, especially because it flies in the face of the traditionalists who say financial freedom is only possible with no debt.

But, consider this:

Imagine that you had $5,000 of credit card debt, owed $25,000 on a line of credit and had $50,000 in available remaining credit on your line and $20,000 available credit on your credit cards.  Now imagine that you were diligently doing what the traditionalists said and paying down your debt, a little bit at a time.  You were staying current on your payments and even paying a bit more than the minimums each month. 

Then wham, your hours were cut at work and out of nowhere your credit card companies decreased your credit card limits and your lender yanked the remaining balance on your line of credit.

Now what do you do?

You’ve got no access to credit and the chances of you qualifying for credit now, given the tightened credit restrictions and the decrease in your income, are ? none.

What should you have done instead?

I’m about to give you a radical plan.  A plan that is not for the faint-hearted.  And, a plan that is all about understanding your best investment.  It’s a plan that requires a lot of belief in yourself and what I’ll call spiritual balls.

Here’s the plan:

Don’t pay off your debt.  Not now anyway.  If you’ve got a line of credit on your house, write a check to yourself for the balance NOW.   Your bank just may take it back tomorrow.

Now, I’m not saying to go out and blow that money on more stuff you don’t need, vacations, or other consumables.

I am saying to put it in your bank account and figure out how you can invest it so it’ll make more money than it’s costing you.

It’s the same with available credit on your credit cards.  I’ve got several low interest credit cards ? about 4.9%.  I know that I can use that credit and earn way more than that.  Not if I buy a big screen TV or go to Cabo, but if I make a great investment.  (If you have poor credit and your interest rates are high, this is likely not a good strategy for you because the return on your investment needs to beat the interest rate on your debt for this to make sense).

So, what’s your best investment?  What’s the best way you can make a 10, 15 or even 25% return on your investment dollars this year?

Invest in yourself!

Take that money and start a business.  Not any business though.  Start a business that will leverage your time and your resources in the best way possible.  It takes money to make money.

(By the way, you do not need to quit your current job to do this!  I started business #2 while I was still working full time in business #1.  Yes, it was stressful and took a lot of work, but it was SO worth it!)

So, use that money to find the best possible mentor you can and put aside some of the money to implement what you are learning.
The key is to find someone who has already done what you want to do and is going to show you the way step by step!

Make the commitment to yourself. You deserve it.

Two years ago, I paid Dave Dee $30,000 plus 5% of my business to coach me on how to build an information marketing business so I could work from home and leverage the knowledge I already had.  Within three months of working with him, I had made $115,000.

Today that business is a million dollar business.  I call that a good investment.

I’ll invest over 6 figures in coaching in 2009 even though I’ve already had a huge amount of success.  But, you know what?  I keep learning.  The most successful people do.  Some of that investment has been made with my own line of credit.  I know I’ll generate at least a million dollars from the investments I make.

If you believe in yourself, there is no better investment than you.  Don’t wait for the bank to take its’ money back.  Invest in yourself and watch that investment pay off for the rest of your life.

Another big week here at Casa de Alexis!

Friday, November 21st, 2008

This past weekend I attended a workshop that rocked my world and has me thinking bigger than ever before. You can read more about it and my big six-figure investment at my personal blog, the Intrepid Mompreneur.

Then, Monday was my birthday. The big 35! And, I got to spend my big day filming my part in an inspirational movie for women called the Vow. Watch for it sometime next year.

My blog was quoted in the Washington Post about a big brouhaha surrounding a well-intentioned, but missed the mark Motrin ad.

And last night, I filmed a family holiday special for CNBC On The Money.

Are You Fighting About Money?

If money is causing a sore spot in your family, and I suspect that it is for a lot of you given the current state of affairs, don’t miss this week’s article that will give you a whole new perspective on how that fighting about money is actually making your financial situation worse … and how you can change that now.

Tying the Financial Knot. What to Know Before You Get Married.

Thursday, November 13th, 2008

The day my ex-husband and I combined our finances was far more significant to me than the day we got married.  Marriage was a big party and a piece of paper signed by the County Recorder.  Combining our bank accounts was a much bigger deal.

On the day we combined our bank accounts, I knew we were making a financial commitment to each other that would be difficult to unravel if things didn’t work out.
And they were.

Here’s a few things I wish I had known before we combined our finances:

1. Taxes

If you are married on the last day of the year, you will file a joint tax return for that whole year.  Even if you get married on December 31, you still file jointly for the whole year.  Yes, you can file as married people filing separately, but that’s not the same as filing two separate tax returns.  You are still taxed as a married couple.

This could save you money or it could cost you money.  Generally speaking, if you earn similar amounts of money, filing jointly will probably cost you more money.  If one of you earns substantially more than the other, it could save you money.

If you are getting married near the end of the year, run out the scenarios with your CPA or using an online tax calculator and consider whether you should postpone the official marriage date until after the 1st of the year.  I know that sounds weird, but if it could save you a lot on your taxes, go ahead and have the wedding, but wait to file the paperwork and make it official.

2. Combining Finances

It’s not always a great idea to combine your finances right away when you get married.  If you are both earning about the same amount of money and you don’t have any children on the way right away, keep your own separate accounts and agree to both contribute to a joint account, which you will pay family bills from.  Get used to this for a while before totally merging all of your accounts.

If one of you earns substantially less, you can adjust the contributions to the joint account pro rata.  If one of you plans to quit his or her job to stay home with the kids or otherwise take care of the family obligations, make sure you’ve discussed ahead of time how the non-breadwinner partner will have control over some of the family money for his or her personal expenses.

No matter what, make sure you each maintain at least one account that is your own account with your own money in it that is not under the control of the other partner.  Each partner needs to have their own financial autonomy even if one partner is the breadwinner and the other is not.  And, each partner should have their own individual credit cards in their names.

3. Community v. Separate Property

If you live in a community property state, all of the income you earn from your labor after you are married is considered community property, which means it belongs to both of you even if it is in a bank account with just the breadwinner’s name on it.  Any of the property you bring into the marriage with you remains your separate property, but only so long as you maintain it as separate property and don’t contribute it to the community.

If you put separate property into an account in both of your names, it becomes community property.  If you earn income on your separate property and that separate property has not been gifted to the community, the income is separate.

If you inherit money while you are married, that stays separate property, but only if you keep it in its own separate account and don’t mix it in with your family accounts.  Once you do, it’s community property.

4. Debt

Any debt you incur during your marriage, is very likely going to be debt owed by both of you, even if only one of you incurred it.  Yep, it’s sucky.  But, true.

So, before you get married and/or combine finances, each of you should show your entire hand. Create your personal net worth statements.  List out your assets and your liabilities.  Then swap the information.

Keep financial records of all assets owned during the month of marriage indicating current value of all assets and amount due on all debts.  This will come in handy if you end up getting divorced down the road and can save you tens of thousands of dollars in legal and accounting fees.

5. Estate Planning

Once you get married or even merely tie the financial knot, you need to get your estate plan in place.  Especially if you don’t have children yet, the law may not provide a default estate plan you’d be happy with.  In California, half of your assets could go to your spouse and half to your parents.  And, if you aren’t married, your whole estate could be left to your parents, leaving your life partner out in the cold.  Take the time to find out what would happen if you were incapacitated or died so you can make sure things would be as easy as possible for the one you love if anything happened to you.

Making the commitment to share a financial life with someone is a big step.  Before you tie the financial knot, make sure you are on the same page about what you want out of life and how you plan to grow, preserve and spend your family wealth.

You’ll Kick Yourself If You Miss This: Financial Freedom Opportunity #1 in a Down Market.

Tuesday, October 21st, 2008

Yes, the market is down.  You’ve probably lost a little money.  Maybe a lot.  You’ve heard me talking about opportunities.  Perhaps you’ve wondered what I meant by opportunities.

Today, the first of two opportunities you cannot afford to miss in this market downturn.

This one is for business owners.

Planning Opportunity #1:  Proactive personal asset protection

If you own your own business, this is the time to think about asset protection.

A few years ago, when I heard about asset protection, I poopoo’d it as something that didn’t apply to me.

First, I figured I didn’t have anything to protect and didn’t need to waste money protecting assets for the future when I needed to focus on growing those assets now.

Second, I thought it was something fear-mongering lawyers put out there to generate more business, but wasn’t really necessary.

Last, I thought it was only for the uber-rich, who were setting up shell companies in places like the Cayman Islands.

Lo and behold, was I wrong on all fronts.  And, if you think asset protection doesn’t apply to you, you’re probably wrong too.

Asset protection means taking control of what you can control – your own behavior and decisions – so you don’t end up in a place of reaction and fear due to events outside of your control.  It means proactively safe-guarding what you have acquired and what you are building for the future.   It means working with a trusted advisor to guide you during times of uncertainty.  It means making smart choices, not from a place of fear, but from a place of empowerment.

Let’s start there.

Is asset protection important even if you don’t have much?

Of course, loss hurts no matter what.   Some might say it’s even more important when you don’t have much because the impact of a loss of the little you do have is so much greater when you only have a little.

Check out this case.  This couple used an advanced asset protection strategy to protect their kids’ 529 college accounts and less than $200,000 of other assets.  And, thank goodness they did or they could have lost everything after a business deal went bad.  At least, at the end of the day, they still had what they safe-guarded.

Safe-guarded from what you might ask?

This is the part that was most surprising to me. I used to think the threat of lawsuits was mostly hyperbole pushed by over-active lawyer imaginations.  Over the past two years I’ve learned through my own personal experience that’s not the case.  As my success has grown, I’ve been threatened with more than one lawsuit.

Having an asset protection plan in place to protect my most valuable assets has allowed me to approach each of the situations calmly and without concern.

Here are a few examples:

*   When I moved into my new house, we hired a cleaning crew to prepare the house for us. One of the housekeepers was cleaning a window and fell through plastic covering           a vent left behind when our floors were refinished.  Of course, her employer                 threatened a lawsuit.

*     A former employee who was fired for theft has brought a retaliatory labor board     claim against me.  Lawsuit filed.

*     When I moved out of my former house, my landlord and I disagreed about who was responsible for the remaining time on the lease despite my having found a suitable replacement tenant they didn’t want.

Each of the circumstances that led to these unfortunate situations was and is outside of my control.  What is within my control and has contributed to my ability to calmly respond without stress instead of being forced into a place of reaction and fear is knowing my personal assets are protected.

So, how does all of this apply to you?

As a business owner, there are many things outside of your control.

What if one of your businesses is forced into bankruptcy due to the business failure of one of your key clients?  What if a disgruntled employee decides to bring a lawsuit?  What if someone gets hurt on one of your properties?  What if there is a disagreement between you and one of your partners, clients or vendors?  What if you can’t make the payments on your equipment or property lease?

Without asset protection in place, all of your personal assets could be at risk.

With proactive asset protection planning, not from a place of fear, but from a place of empowerment, you would have the peace of mind of knowing that your children’s future is safe-guarded.

During this time of uncertainty, that kind of peace of mind can be priceless.  It will allow you to make business decisions more aggressively and ultimately achieve more of the success you want.

The key is to be proactive because otherwise, the asset protection planning may not work, no matter how good it is.

If you wait until something has happened, you cannot put in place asset protection plans without violating laws against fraudulent conveyance, which prohibit you from moving assets once you are facing the threat of a lawsuit.

Here’s an asset protection action plan for you to take right now:

1. Make sure your business is properly incorporated as either an LLC or a Corporation.

2. If you are incorporated, be sure you are in compliance with all State filings, records of meetings, separate sets of books and bank accounts, and other record keeping requirements.

3. Consider advanced asset protection strategies, such as a Nevada LLC, which provides “charging order” protection, or an irrevocable trust to shield your personal assets.

Asset protection is necessary even if you are doing everything right.  In fact, I’d say it’s necessary especially if you are doing everything right because that means you’re successful.  And the more successful you are, the more important this is.

Remember, it’s not about reacting from fear, it’s about empowerment.

If you are a business owner and you are serious about doing some proactive asset protection planning, go to the Personal Family Lawyer website and request a Family Wealth Planning Session.  Use the certificate code “Asset Protection” and I’ll get you a private phone consultation with one of the top asset protection lawyers in the United States.  Please only take me up on this if you are serious about asset protection, have at least $100,000 of assets outside of your business to protect and you are willing to make the investment in proactive protection.

I’m Scared Too … What to Do Now

Wednesday, October 8th, 2008

I was going to write to you today with 6 actions steps to take to prosper now.  But, I logged into my Schwab account yesterday to find out that I had lost over 1/3 of the account value in my investment account, ½ the value in my Roth IRA and ¼ of the value of my Traditional IRA.

I wanted to cry.  Ok, truth be told, I did cry a little bit.

Then, last night, I had a dream that my teeth were falling out.  I haven’t had one of those in a long while.  I only have them when I’m stressed.  It’s from grinding my teeth.

And, I realized that without even being consciously aware of it, I’m massively stressed about by what’s going on around me. If I am, you are.

Truthfully, I have nothing to be stressed about.  My business is better than ever.  I live in paradise and even if I lost every bit of money I’ve accumulated in investment accounts, I’d still be just fine.

But, all of this economy stuff has impacted me at a core, subconscious level.  It’s uprooted financial fears that are grounded in my childhood and the past and while not based in my current reality are clearly still there.

How do I know?

I find myself distracted.  First thing this morning instead of focusing on my business, I was obsessing about the money lost in my investment accounts.  I find myself searching the net for information about the economy and what’s happening out there.

Not focusing on my business or on anything that I can control.

And if I’m distracted, I bet you are too.  So, the 6 action steps will have to wait until tomorrow because what I have to say today is too important and if you don’t heed this message, you will be too stuck to get into action.

That’s the real danger of what’s happening in the economy.  Many thanks to Stephen Fairley for helping me see this clearly.

What I feel inside of my body and I think you do too is overwhelming fear

Here’s the problem:

What we focus on grows.

As the news media, the internet and people around us spout the doom and gloom news about the economy, we experience fear on a bodily level.  Even when that fear is not externally justified because our own situations are pretty darn good (for example, this is a great opportunity for people who were previously shut out of the housing market to own their own homes), the fear is in the air and it can be hard to ignore.

And if you are like me and have financial fear deeply rooted in your consciousness as a result of growing up with programming that have led to lack consciousness, unresolved emotions can rear their ugly heads and manifest themselves in illness, general dis-ease, and worst of all distraction.

If you are a business owner, you cannot afford to get distracted by this fear.  Distraction leads to lack of focus, which leads to decreased action, which leads to a decrease in your business.  This is the biggest danger to your business, not the economy.

If you are able to get out of the fear and FOCUS your business will be successful.  No matter what happens with the economy, you will find a way to thrive.  Haven’t you always?

And, if you haven’t, it’s a perfect time to start learning how.

So, what should you focus on?  Only that which you can control.

Most of what is going on is outside of your control.  You cannot control the ups and downs of the Dow.  You cannot control everything going on out there.

The only thing you can control is yourself and your own response to what’s happening.

You can control your personal actions.  So, pull yourself away from the news and the internet and take a few minutes to make a list of everything that is within your control and focus on only those things.

If you have money invested in the stock market that you know you are going to need within the next year, liquidate those accounts and get them into FDIC insured bank accounts, which is where they should have been in the first place.  Don’t beat yourself up if they weren’t. Just be thankful that you learned from the mistake before you lost all of your money and take action now.

If you have money invested in the stock market that you are not going to need for another 20 years or more, leave it where it is and do NOT LOOK at the account values again.  Everytime you look remind yourself that you have just lost focus and bring yourself back to awareness of what you can do now.

Here’s a great exercise – each time you find yourself losing focus, take out a piece of paper and make a list of everything you can do right now to increase your income, then start to take action on those items.

If you are ambushed by co-workers or friends who insist on ratcheting up the fear level or spewing negative prophesies, tell them you are not willing to do that today and send them this article to read.

If you feel like you need to indulge your fear a little bit, take 5 minutes and write down everything you are afraid of and the worst case scenario if all of those things actually happen.  Write down your beliefs about those outcomes and inquire within as to whether those beliefs are really true.

I think what you’ll find if you do all of this is that you are okay.  All of your needs are truly met in this moment and that the fear is just a big test to see how committed you are to your path of success.

What Now? How to Find the Golden Opportunities Right Beneath Your Feet

Tuesday, October 7th, 2008

Yes, the economy is in the toilet.  Yes, it’s a scary time.  And, yes there are loads of opportunities.

It’s true.  If you stop watching the nightly news and start listening to the right people – people like Suze Orman, Ramit Sethi, Dave Ramsey, Bill Bartmann and JD Roth – what you’ll hear is that there are opportunities to be had during these times of turmoil.  Great opportunities.

Bill Bartmann made a BILLION dollars during our last economic crisis.

Even where it appears that there is pain happening all around you – people losing their jobs, stock market losses, and retirement plans being devastated – if you can see through that outward appearance to another layer of depth you will prosper during this time.

So, what are the opportunities?And, how do you find them?

That depends on your current situation.

Here’s the first opportunity:

Honestly assess the reality of where you are right now.  There’s no more hiding.  It’s time to come out of the darkness and shine a light on where you really are.  What a beautiful opportunity!

Today, in this moment, you get to start over from a place of new awareness.  You get the opportunity to learn from your mistakes.  You get to move out of shame, guilt and fear into the light of truth, beauty and honesty.

It starts with getting honest about the reality of your situation.

Over the past few years, most Americans saw their wealth increase more than they could ever imagine.  The equity in our homes exploded.  We had more access to credit than ever before.  Jobs were plentiful.  And salaries were steadily increasing.

Good times.

How did you respond during these good times?

Did you get caught up in the buying frenzy, increase your debt load and use this new found money to buy (or lease) new cars, big screen TVs, toys for your kids, and clothes for yourself?

Or, did you use your access to capital to start a new business or expand an existing business?

Perhaps you kept your eye on your future and put money away in 529 plans and retirement accounts.

Maybe you invested in real estate either in your own backyard or across the country where home prices have dropped precipitously.

Whatever you did, my bet is that you are freaking out a little bit now.  Wondering if you made good choices.  And what the results of those choices will be.  Fretting over what to do next.

Good.  Either way, you are thinking.  You are becoming aware.  You are discovering that what you do and how you think has ramifications down the line.  It’s time to wake up.

So, what should you do now?

That’s opportunity number two.

You get to decide from this day forward how you want to show up in the world.  Five to ten years from now, everything will be different.  Housing prices will be going back up.  The stock market will be out of the toilet.  Jobs will be plentiful.  Where will you be?

More importantly, who will you be?

Will you have the cash in 2010 when some people think our real estate market will bottom out to buy or will you be sitting around in 2020 when prices are through the roof again wishing you hadn’t missed the boat, again!

How you respond NOW will determine the answers to these questions.  Note my use of the word respond.  You can choose to RESPOND to what’s happening right now or you can choose to REACT.

You don’t have control over the stock market or the effects of the bailout plan.  You do have total control over you.  That’s an opportunity.

If you react, chances are you will over-react.  You will move into fear, guilt, shame and anger.  You will try to blame other people for your situation.  You will fail to take responsibility for your own circumstances and see yourself as a victim.  You will miss the opportunity that is right here in front of you.

Or you can respond.  If you choose to respond instead of react, you will be empowered to make smart decisions.  You will take responsibility for your current situation and see it for the learning experience it is and make the decision to get informed and educated. You will recognize that you are not a victim and there is no one to blame.  You will forgive yourself for the poor choices you made or congratulate yourself for making smart choices.

If you made poor choices over the past few years and you are in debt up to your eyeballs, trying to hold onto your house or have perhaps lost your house already, and you don’t have a job or a business that is supporting you, it’s time to get serious.

Here’s the opportunity!

Take a good hard look at the income you need each month to clear up your debt and start investing in yourself, look around the house and see how you can simplify, what you can eliminate from your life, to see what you can sell, and either get a job or buckle down in your business and focus on your income producing opportunities.

Start taking the small actions you need that will allow you to feel good about yourself again.

Either way, I recommend you use this as a time to get informed.  Not from the nightly news.  Not from your friends.  Not from Twitter or Facebook.  Get informed by doing your own research, your own investigation.  Meet with your own trusted advisors.  If you don’t have any, get some.

And keep (or start) taking care of yourself.  Go to the dentist.  Exercise.  Eat right.

The more you take care of you, the more you’ll start to realize you deserve it.  The more you begin to realize you deserve it, the more you’ll start asking for what you want and the more you’ll start getting it.  The more you get what you ask for, the more you’ll be grateful and take care of yourself.  It’s a perfectly beautiful feedback loop.  Get it going.

In a couple of days, I’ll give you 6 concrete steps you can take right away to start prospering now.

Family Financial Freedom Notebook

Sunday, October 5th, 2008

Lots of people are wondering, what do I do know that the economy appears to be melting down?

First and foremost, don’t panic.  You are not going to end up standing in line for the soup kitchen.  Not if you’re reading this right now.

What you are going to do is get more aware of your family finances, learn to live within your means and generally gain awareness you didn’t have before.

Then, you’re going to look back on this “financial crisis” as the best thing that ever happened to us.

One of the most important things you can do is to establish a family freedom notebook.  This is a notebook that you use to keep track of everything related to the financial well-being of your family.

At a minimum, here’s what you put in it:

1.  Monthly bank statements for every bank account you have, including any custodial accounts in your kids’ names (keep 12 months worth of statements in the notebook and then scan and archive older statements).

2.  Monthly brokerage account statements for every brokerage account you have, including college savings accounts, like 529s (keep 12 months worth of statements in the notebook and then scan and archive older statements).

3.  Monthly retirement account statements for each of your retirement accounts (keep 12 months worth of statements in the notebook and then scan and archive older statements).

4.  Monthly insurance policy statements for each of your insurance policies ((keep 12 months worth of statements in the notebook and then scan and archive older statements).

5.  Copies of your insurance policies (keep these forever).

6.  Documents related to any other assets owned, such as the pink slip for your car or lease papers if you are leasing your car.

7.  Monthly mortgage statements (keep 12 months worth of statements in the notebook and then scan and archive older statements).

8.  Monthly credit card statements (keep 12 months worth of statements in the notebook and then scan and archive older statements).  Also, in this section, keep a list of all of your credit card numbers, along with their security codes and the 800# on the back of the card.  This list will be a lifesaver if you lose your wallet.

9.  Any other loan statements or statements evidencing liabilities you may have, such as student loans, personal loans from parents or car loans.

10.  Family Profit and Loss Statement:  This is a monthly updated ledger of all income that comes into your family and all expenses that go out.

11.   Family Balance Sheet:  Updated monthly, this will list out the current values as of month’s end for each of your accounts, including liabilities.

12.  Estate Planning Section:  Your whole estate plan would be too big to keep in your Family Freedom notebook, but you can keep a CD or jump drive with your estate planning documents on it and any documents related to the transfer of assets into your Living Trust.  Plus, keep your long-term guardian nominations and your Kids Protection Plan, medical powers of attorney for your kids, and your own health care directives and powers of attorney in this section as they will need to be accessed immediately if anything happens to you.

13.   Other personal legal documents:  if you own property with anyone else, have entered into any business arrangements, or have personal legal agreements, keep those in this section.

14.  Pay stubs:  keep a year’s worth of the part of your pay stub that shows how much you got paid, how much went to taxes and how many hours you worked.  I can’t tell you how many non-breadwinner spouses have told me they don’t know how much money the breadwinner spouse makes.  Bad idea. Make sure you know and have the records.

15.  Social Security Statement: You know that green and white letter you get in the mail each year that says how much you’ve paid into social security and how much you can expect to get, keep it here.  I can’t promise you’ll actually get this as our system may not have the money to fund it, but you can at least keep the record that shows you paid into the system.

Obviously, this notebook contains very sensitive information, so consider keeping it in a small fireproof safe in your house.  Just make sure the safe is not one that can be lifted up and carried away by a thief.  Make sure it’s the kind that anchors into the ground or the wall.

Please note:  this is not a household notebook or a Family Emergency notebook.  That’s a whole different animal and something that SHOULD be kept accessible to other family members, babysitters and household helpers.

If you have other suggestions for the Family Financial Freedom Notebook, please post them here in the comments.  I love to hear your ideas.

Don’t Keep it In … Relief Comes When You Let It Out

Friday, October 3rd, 2008

I just finished reading an article in Conde’ Nast Portfolio Magazine by Michael Lewis who moved his family into a New Orleans mansion they could ill afford.

He pointed out the problem with the upper  middle-class,the problem that has gotten us where we are today A problem I lived through my whole life growing up.

A problem Lewis so clearly illustrated by describing the story of Lilia and Jesus Garcia of Stockton, California. A middle class couple making a combined $130,000 a year each who moved into a mansion-like house they bought for $535,000.

Of course they ended up in foreclosure. They couldn’t afford the house. It was a symbol of how well they were doing. But, they really weren’t doing that well at all. Not well enough to live in a mansion.

I knew it was time to sell my house when someone offered $625,000 for it (it was 850 sq. ft.!) and my hairdresser and her bartender husband bought a $750,000 townhouse in our neighborhood.

These people couldn’t afford the houses they were buying.
I could see what was coming because I’ve been there. I lived this reality.
When I was 7 years old, my parents moved into a show house, like the Garcias’.
It was the Old Spanish house at the corner of Old Cutler and Ludlum in Miami, Florida.  Everyone knew the house. I never had to use my address. I could just give the cross streets and people would know my house.

I felt special. I’m sure my parents did too. And they bought it to make up for the fact that they had less money and less security and less of a future than the rest of their friends who truly were upper middle class and some of whom were uber-rich.

What people didn’t know about our house was that the kitchen was full of cockroaches. The electricity would frequently get turned off when my dad didn’t pay the bill.
We couldn’t really afford to live there.

My dad had to borrow money from my grandparents to buy the house.  Money he never was able to pay back. My mom always blamed him for that.  Didn’t she know they couldn’t afford it?

If not, why?
Something tells me my dad didn’t even want that house. My mom pressured him to keep up with the Greenberg’s, the Markowitz’s and the Little’s.That’s why they bought the house.

So, what do you do when you take on a lifestyle you can’t afford? You either find a way to make more money or you take a big step back and start to rebuild.

It’s not the end of the world. You aren’t going to die. Well, maybe a part of you will.  Your ego. It may die. But, that’s not such a bad thing.

You move into a rental in a less desirable neighborhood (in Miami, that was Kendall where the solidly middle class live) and you give up your fancy cars.

Your kids get jobs and buy their own first car. Mine was a 9-year old Honda Civic I paid $1,600 for out of my work money and loved.

You start shopping at Target (back then Kmart) instead of Nordstrom’s or Saks.  You do more with less.

And you find out that it’s okay. You are alive. You don’t need all that stuff.
Now that you’ve tasted the good life, you can have it again if you really want it. You’ll just get there on a solid foundation next time.

If your marriage is built on deep love and trust, you keep your family together. You don’t blame each other. You take responsibility for your part.
If your marriage is built on the same fa?ade that your life was built on, it falls apart too.

My parents’ marriage did. My mom’s crumbled expectations were too big a burden to bear on their marriage. My dad could never give her what he had promised.
And on the other side of all of it, you find something new and fresh. You find the truth of who you are. You find what matters.

With any luck at all, one day you look back on all of it and thank God for it because you realize it took losing everything to find yourself.

If You Really Can’t Decide Who to Name As Guardians, Here’s What to Do

Sunday, September 28th, 2008

There are a lot of parents out there who have not named       
guardians for their kids because they really can’t decide.

You might be one of them.

But, here’s the thing. If you don’t decide and something happens to you, the decision gets made by a Judge.

You don’t want that, do you?

Here’s a few things that may help you decide:

1.  Think through on a practical, realistic and non-emotional (to the extent you can) level who would come forward to raise your kids if you were in an accident.

2.  Is that who you would want to raise your kids?

3.  If not, who would be better than that person or those people?

4.  If more than one person would come forward, who         
would a Judge pick if the Judge had to decide between all
the people who would come forward?

Bottom line? 

If you don’t decide, a Judge will. Even your worst choice would be better than that, right?

The free website will walk you through the entire process of choosing the right guardians for your kids and then legally document your decisions.

If not knowing who you want to name has been holding you back, don’t let it hold you back a second longer.

Do it now. It’s Free. It’s Easy. No Excuses.