Failure Is All Around Us – And That’s a Good Thing

April 14, 2017

One of the consistent themes in life – in virtually every facet – is failure. It was one of the things that the University of North Carolina basketball team talked about after they beat Gonzaga for the national championship. Last year, UNC lost in the national championship game to Villanova University. This year’s team used last year’s loss as motivation. There are countless examples in the sports world of a failure being used as a motivation for a future success, but it only works if something is learned in the process.

We see that when we are interviewing candidates for positions here at Financial Finesse. At some point in the process, the conversations usually turn toward their biggest successes and failures in life. It’s amazing the stories that we hear about both sides of that equation.

More often than not, the lessons learned from the failures are much more valuable than the lessons learned from the successes. The same concept has proven to be true in the financial lives of many employees I talk to each week. There are a few “rules” that I use when coaching a person through a failure to help them not repeat it and to end up in a better place because of the lesson learned in the failure.

1. Forgive yourself. There is absolutely nothing to be gained from berating yourself and giving yourself negative messages. Say “I messed up this time, but I’ll get better.”

One of the more common “failures” people talk to me about is amassing credit card debt. They view it as a personal failure, and many people think that they’re the only person in the world who has gotten a little bit in debt. When they learn that others have been in this position (and MUCH worse) and then gotten themselves out of debt with just a few slight tweaks, they can exhale, begin to forgive themselves for the debt, and prepare to move forward.

2. Figure out why it happened. What exactly led to the failure? Was it a lack of attention? Was it a disregard for the consequences? A lack of information/education or something outside of your control?

Once you figure out the why, the real learning is possible. In the debt situation, it’s usually a simple lack of attention to detail that created the issue. A $20 purchase here, $25 there, a doctor’s visit with a copay and a night out with friends and all of a sudden there is more month than paycheck – and the need to use a credit card is there. If that pattern persists for long enough, there can be a few credit cards approaching their credit limits.

It’s not malice or blatant carelessness. It’s a gradual slow creeping up of credit card debt that happens when there isn’t a focus on exactly where each dollar is going. I’ve met a lot of people with significant credit card debt. Exactly zero of them woke up one day and said “I’m going to max out four different cards today and then struggle to pay them back.” It’s a slow build, and once there is a realization of that – the pay down can start.

3. Recognize that whatever the failure is, it isn’t YOU. It’s usually just one behavior that if modified ever so slightly, can be turned into a strength/reason for your next success. The tired old movie line “it’s not personal, it’s just business” is important here.

Don’t take a financial speed bump as a personal failure. It isn’t you. It’s situational…and situations can change.

4. Change whatever that behavior is! This is by far the most important step. The old “if you keep doing what you’re doing, you’ll keep getting what you’re getting” phrase comes to mind.

Usually, changing a behavior isn’t as tough as we think it is. I’ve started to use an app to track my exercise and nutrition and as a result, my level of fitness is increasing while my level of body fat is decreasing. One quick change – using an app to log my meals and my exercises – is helping me make very small changes that are providing good results.

5. Stick to the positive change. The world is filled with stories of people who have made progress, only to regress after a short period of time. I’ve had friends lose 25-50 pounds, only to put on 30-55 after burning out of the program they used to lose it. I’ve seen people file bankruptcy because of massive credit card debt, only to rack up another $40-50k in credit card debt within a year or two of the bankruptcy. Progress is best when it’s sustainable.

It’s impossible to go through life without experiencing failure. If someone does, it means they’ve either never tried anything difficult or they have absolutely zero self-awareness and don’t recognize their failures. Neither is ideal. So if it’s virtually impossible to go through life without experiencing it, embrace the failure that is all around us and use it to motivate you to a future success.

What I Really Want for Christmas

December 21, 2016

It’s the most wonderful time of the year: that time when we all give thanks for what we already have, then storm the malls for 30-ish days to buy more stuff. We’re constantly asked what we want for Christmas and then the rest of the year, we try to reconcile our consumer culture with our desire to be content with what we have. So when I’m asked for my wish list, I confess that instead of thinking of presents, I wax idealistic and think in terms of what I would want if it weren’t for that pesky reality issue. In no particular order, this is all I want for Christmas — or ever:

1. A couple do-overs

I actually don’t regret the headline “mistakes” of my life — like saying “I do” when we didn’t or changing my college major in order to graduate on time. Those things have led me to where I am today, which is exactly where I want to be. It’s those little things I’d like to go back and fix like the time in 4^th grade when the kids on the bus were teasing my little brother and I chimed in rather than stood up for him or skipping my best friend Jenny’s bridal luncheon because I didn’t want my boyfriend at the time to be bored. A mulligan wouldn’t change the course of my life, but it could have made a big difference to someone I care about.

2. Everyone to give a crap about the environment

It’s the only earth we have. I don’t get why some people are able to turn off their give-a-darn when it comes to taking care of it — like the woman who told me that recycling is “impossible” at her house because she has two teenagers. Nice excuse, but don’t teenagers typically care more about that stuff than their parents?

I’d even be satisfied if everyone just turned off the water while brushing their teeth. I see people lamenting global warming but then toting around disposable plastic water bottles. Just one small change can make a difference.

3. No more homeless pets

At one time in my life, I actually lived with four cats. I dream of opening our home to a dog or two once we have a yard and won’t have to walk up three flights of stairs for every walk. It kills me to go by the shelter and see those poor puppies and kitties waiting for some love and attention. Please spay and neuter your pets. And the next time you want a furry friend, adopt from the shelter instead of buying from the store.

4. Money to cease being taboo

I always say that if people walked around with their credit card balances displayed, everyone would feel better about their financial situation. It saddens me how many wonderful, successful people I know are secretly freaking out inside about money. They feel trapped in a lifestyle that is destroying them financially. If we were more honest with each other about our fiscal challenges, we’d all find it easier to resolve the problems and focus our energy on the things that really matter to us.

Of course I’d love to see world peace, an end to greed, and the ability to time travel, but let’s not get carried away. These four wishes are near and dear to my heart. What would you put on your suspended-reality wish list? I’d love to hear your answer on Facebook. And happy holidays!

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Sometimes It Does Take a Rocket Scientist

October 03, 2016

Portia Jackson believes that people should be able to design their finances around their lives and not their lives around their finances. A business strategy coach and former rocket scientist who is studying financial planning, Portia joined our team this year for a long term financial planning internship. I recently had a fascinating conversation with her about her world view and why she is pursuing her CFP® designation. The future for this mother and financial wellness evangelist looks bright!

Why did you become a personal coach? What influenced your decision to pursue the CFP® designation? How do you see combining those two paths?

I became a business strategy coach after many of my original podcast listeners (I used to host a podcast for working moms, Working Motherhood) kept emailing me and asking me how I was able to run a business, work full-time and manage my family, including a daughter with special needs. I loved my podcast and it gave me fulfillment, but as I started working with the members of the Working Motherhood, I realized I LOVED coaching so much more! I get to help people see an immediate difference in their lives? Yes, please!

I decided to pursue the CFP® designation after teaching a workshop course on tackling debt for many years. I loved the impact I was making on people’s lives and seeing the weight lifted off their shoulders after they realized they wouldn’t be in debt forever made my heart sing. I wanted that feeling all day every day so I decided to change careers and become a financial planner. I also wanted to do it right so I knew I had to be a CFP® professional. The two paths easily combine because I believe the combination of a solid financial plan (i.e. 6 months emergency fund, zero debt, fully-funded retirement and college plans, home ownership, estate plan, tax minimization and proper insurance coverage) with working at something you love to do is a complete path to financial wellness.

How does your background as an engineer influence your financial planning and personal coaching style?

My engineering background helps me as a financial planner and coach because I’m very data-driven. I work off of action, not just “what could happen.” If something isn’t working, I can course-correct. Planning a launch of a billion-dollar rocket and launching someone’s business or retirement plan are both very important so I use my strategic background to reduce some of the uncertainty that can surround those areas.

What’s your personal mission? Who do you most want to help?

My personal mission is to free people from financial stress and bondage so they can then pursue their personal mission in life. I feel that many times the amount of energy people put into worrying about money (even if they are doing everything “right”) can be put toward their personal calling in life. I believe everyone has a specific purpose in life and that purpose often goes unfulfilled because they are stuck in a job they dislike just to pay the bills and then they are too exhausted to do anything else or sometimes people are doing everything right and still can’t afford a decent lifestyle.

They aren’t trying to keep up with the Joneses. They just want to be able to own a home, have insurance, travel maybe 1-2 times a year and send their kids to college. In an expensive place like Los Angeles, that can easily add up to a lot.

What is the biggest mistake you ever made with your money, and what did you learn from it?

The biggest mistake I’ve ever made with money was buying a rental property at the age of 23 in a bad neighborhood with no money down in 2005 in Chicago right before I moved to Los Angeles for grad school. I really don’t know what I was thinking when that happened. Actually, I do. I was focused only on the POTENTIAL cash flow. Those late night real estate ads were apparently very convincing to me.

The property was a big pain the butt. It sucked up all of the money I won from a game show I was on and commercials I booked while I worked in Los Angeles. It also caused a LOT of stress for me during what should have been one of the most exciting times in my life.

What have you learned about money and marriage that you can teach the rest of us?

I’ve learned that communication is key and that understanding each other’s personality types is really important when it comes to family finances. My husband and I have monthly financial meetings, where we review our budget, our net worth statement, our financial goals and the financial mission statement we’ve written for our family. I’m the CFO of our family and while I can typically recite the budget down to the penny, he is the bigger visionary and wants to see where we are going.

When you got married and had children, did you feel prepared to deal with the financial aspects of partnership and parenthood? What do you wish you had known in advance?

We felt pretty prepared going into marriage because financial planning was part of the two pre-marital classes we took. (We like to be thorough, haha.) When our kids came (very soon actually, we had a honeymoon baby) it wasn’t too much of a disruption to our budget, although the budget for sending kids to daycare could feed a small country for a while.

How do you teach your kids about money?

Our kids are just 4 and 2 right now so we haven’t really had the money discussion yet, but we plan to use the envelope method that I used growing up — one envelope for giving, one for saving and one for spending. They will earn money through chores as they will not receive an allowance. As parents, we believe that we are to be mentors to our kids and train them for the real world and in the real world, there are very few handouts.

Is there anything that really surprised you about coming to intern at Financial Finesse? Why?

Yes, I was surprised that workplace financial wellness as a type of business actually existed. When I was searching for a place to complete my required experience hours for the CFP® designation, I came across many opportunities to sell products or gather assets, but I never heard anyone lead with the benefit of changing lives and offering unbiased financial guidance with no ulterior motive or sales pitch, which is what we do at Financial Finesse. The passion that everyone has here for helping people and for extending this vision to more people is truly amazing and a rare jewel in the financial services industry. Unlike in my brief wire house days of seeing people get excited to close a sale, people at Financial Finesse are excited about a great Financial Helpline call or one-on-one planning session.

Do you have a question you’d like answered on the blog? Please email me at [email protected]. You can also follow me on the blog by signing up here, and on Twitter at @cynthiameyer_FF.

4 Financial Moves I Wish I’d Made in My 20’s

August 24, 2016

Whenever I have the opportunity to work with an employee who is just starting their career by calling the Financial Helpline to make sure they’re making all the right financial moves, I can’t help but gush a little bit. This simple phone call often sets into motion actions and habits that will legitimately change the course of this person’s life. I often wonder how my life would have been different if I’d had the Financial Helpline to call for unbiased financial guidance from someone who would have given me a straight answer, no strings attached. If I could turn back time, here’s what I’d have done differently:

Joined an HSA plan as soon as it was offered. I still remember the hoopla in the financial services community when health savings accounts were first rolled out, but I didn’t get it. I wasn’t yet a financial planner, so I didn’t fully understand why anyone would sign up for a health insurance plan that could cause them to pay full price for the first couple thousand dollars in healthcare expenses each year, and didn’t even consider signing up. Similar to many people’s logic, I avoided the HSA due to the high-deductible without taking into consideration the fact that my employer was willing to fund some (or all) of that deductible and based on my lack of health issues, I was unlikely to spend even that. By the time I realized the beauty of the HSA, I only had a couple years before it was time to switch to more comprehensive coverage since I knew my costs were going to increase.

Opened and funded a Roth IRA. I’ll never forget the day I stepped into my co-worker Tom’s office and asked him to open a brokerage account for me to begin investing in an index fund with the extra money I had been paying toward my low-interest student loan. Tom looked at me and said, “Are you sure you don’t want to use that money to fund a Roth IRA instead of a taxable account?” I nodded, thinking that I didn’t want to kiss that money goodbye for the next 35 years, so I opted for a regular brokerage account.

I was wrong. Had I instead used that money to fund a Roth IRA, I still would have had access to my deposits without tax or penalty, and I would never have to pay taxes on the growth of my investments after age 59 1/2. When asked by young people about priorities in savings, I never waiver in my answer:

First get the match in your 401k. It’s free money, enough said.
Then max out your HSA. If you don’t need the money tax-free for healthcare expenses, you can access it like a normal retirement account after age 65. It’s also often free money.
Then fund a Roth IRA. While you are still under the income limits and the money has years to grow, take advantage of it.

Created a pet care fund. I adopted my first cat, Hattie May, my senior year of college and over the course of her short 13 year life, I estimate that I spent at least $5,000 on her care. The worst part about this is that I should’ve spent more to take care of her issues, but because I didn’t have money set aside, I skimped. This is something I’ll forever regret and I often wonder if she’d still be alive today if I’d prioritized saving for her costs. Here’s what I should’ve done: find out the cost of pet insurance for annual visits plus emergency care and then instead of buying the insurance, set that amount aside each month into a separate savings account. That way when things did come up, I would’ve had money available and if nothing came up, I wouldn’t be out the money.

Spent less money on cheap clothes. Confession: I engage in retail therapy with the best of them. I just wish I could go back to those early years and made a few less trips to stores like Old Navy and Target, where I succumbed to merchandising brilliance and bought clothes I maybe wore twice. I could’ve re-routed that money toward Hattie’s fund or a Roth IRA. The worst part is that when I went through periods of closet-cleaning during those years, I didn’t receive any tax benefit from donating those clothes as my itemized deductions weren’t high enough to qualify.

What I wish I’d done is put a limit on myself for impulse shopping. I don’t believe in going cold turkey. I do think we can all handle moderation though.

I can’t turn back time, but I can share the wisdom of my mistakes so here’s hoping you can learn from mine. What financial moves do you wish you could do over? Let me know on Facebook or send me a tweet.

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We All Make Mistakes

July 05, 2013

My daughter and I took a trip together and I let her be our DJ and choose all of the music while we were in the car together. Well, almost all of the music. There are a few songs I had to ask to skip, I just couldn’t stand them! Continue reading “We All Make Mistakes”

What I Learned From a Bad Movie!

June 29, 2012

Over the last weekend, I had the pleasure of seeing a new movie. I really love going to the movies, but I rarely do it. And when I do, it’s usually a Disney or Pixar movie with my kids. So, it was a rare treat for me to get to go out with a friend and see a non-animated movie. Being completely clueless about what movies were in theaters now, I deferred the decision to my friend who chose “Abraham Lincoln: Vampire Hunter” in 3D. She had read the book and loved it, and she knew that I like historical fiction – books that take historical events and get “creative” with it. Continue reading “What I Learned From a Bad Movie!”