What is Financial Health?
Financial Health is how well you handle your financial responsibilities such as budgeting, investments, credit etc.
There’s never been a better time for women in partic- ular to take control of their financial futures. Even if financial equality has not been achieved, women are more financially successful and independent than ever before. With that success comes more responsibility to organize and manage their financial health.
• There are over 10 million female-owned businesses in America, generating more than $2.5 trillion in annual revenue. (That’s AWESOME!)
• Women are starting new companies at twice the rate of men, according to the National Foundation for Women Business Owners.
• Women tend to be better investors than men.
According to a recent study by the National Association of Investment Clubs, women’s investment clubs outperformed their male counterparts by a wide margin in 9 out
of 12 years.
While more women today are taking charge of their financial future, many leave money management to men or 35
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ignore it altogether. As a result, far too many women stay on the sidelines of the money game and never take charge of their financial future.
At first glance, it may be difficult to believe that women’s financial needs are all that different from men’s. However, while the general principles of financial planning are universal, women face unique challenges that amount to different financial needs.
• Women live longer than men (an average of 7 years) so they need 20% more for retirement.
• On average, women earn 25% less than men.
• Since women tend to take time off to raise children or take care of parents (women take off approximately 11 years more from work than men), they save less than men do for retirement.
• After earning lower salaries for fewer years, women’s social security benefits are about half of men’s.
• The majority of women had certificates of deposit (CDs) in their retirement savings accounts when a more aggressive investment vehicle was more appropriate.
There are serious consequences for women who do not know how to handle their finances properly or effectively and some are as follows:
• Almost 1 in 4 women are broke within two months of a husband passing away, because they were never involved in the financial business of the family.
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• Over 75% of all women are eventually widowed at an average age of 56.
• 53% of women are not covered by a pension compared to only 22% of men.
• A staggering 87% of the poverty stricken elderly are women.
The statistics are startling--but it’s never too late to start taking control of your financial future.
Can’t pay your bills? You’re not alone. Today, millions of Americans are having difficulty paying their debts. Most of those in financial distress are middle-income families with jobs, who want to pay off what they owe.
But it is important for you to act. Doing nothing can lead to much larger problems in the future-even bigger debts, the loss of assets such as your house, and a bad credit record.
The good news is that there are solutions. The remedies provided can help improve your relationships with creditors, reduce your debts, and help you manage your money. In brief, these solutions can help give you a new, fresh start.
If bill collectors are calling you, you know you’re in financial trouble. But what if you’re just having difficulty stretching your paycheck to pay monthly bills? If you answer yes to any one of the following questions, you should act.
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Do you routinely spend more than you earn?
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Are you forced to make day-to-day purchases on credit?
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Are you able to make only the minimum payments on monthly credit card debts?
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If you lost your job, would you have difficulty paying next month’s bills?
There are things that you can do to change your financial picture.
Some tips are listed below:
Review your specific obligations that creditors claim you owe to make certain you really owe them. If you dispute a debt, first contact the creditor directly to resolve your questions. If you still have questions about the debt, contact your state or local consumer protection office or state Attorney General.
Contact your creditors to let them know you’re having difficulty making your payments. Tell them why you’re having trouble perhaps it’s because you recently lost your job or have unexpected medical bills. Try to work out an acceptable payment schedule with your creditors. Most are willing to work with you and will appreciate your honesty and forthrightness.
The Fair Debt Collection Practices Law prohibits a debt collector from showing what you owe to anyone but your attorney, harassing or threatening you, using false statements, giving false information about you to anyone, and misrepresenting the legal status of your debts. Remember that under other federal laws to collect debts, creditors cannot seize most government assistance and can only garnish a portion of wages to collect debts.
Budget your expenses. Create a spending plan that allows you to reduce your debts. Itemize your necessary expenses (such as housing, insurance and health care) and optional expenses (such as entertainment and vacation travel). Stick to the plan.
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Try to reduce your expenses. Cut out any unnecessary spending such as eating out and purchasing expensive entertainment, David Bach author of Start Late and Finish Rich calls it the Latte Factor. Consider taking public transportation rather than owning a car. Clip coupons, purchase generic products at the supermarket, and avoid impulse purchases. Above all, stop incurring new debt.
Consider substituting a debit card for your credit cards. Don’t spend what you don’t have.
Use your savings and other assets to pay down debts.
Withdrawing savings from low-interest accounts to settle high-rate loans usually makes sense. Selling off a second car not only provides cash but also reduces insurance and other maintenance expenses. Suzie Orman suggest that you only spend paper money, meaning once you break a dollar save the change and put it in a jar and see how much you can save.
Look for additional resources from governmental and private sources for which you may be eligible. Government assistance includes unemployment compensation. Aid to Families with Dependent Children (AFDC), food stamps, low-income energy assistance, Medicaid, and Social Security including disability. Other resources may be available from churches and community groups. Often these sources are listed in the Yellow Pages of your phone book.
Have you considered having your own business versus being employed?
Have you read the Rich Dad Poor Dad bestselling trilogy by Robert T. Kiyosaki? This is a must read for anyone wishing to 39
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control their financial future and even target super riches. The books in sequence are:
1. RICH DAD POOR DAD
2. CASHFLOW QUADRANT
3. GUIDES TO INVESTING
Compared to a job or a self-employed profession, his presentation, rationale and arguments for building your own business are compelling. We recommend that you study his material. Here are a few quotes:
• “The rich don’t work for money.... the poor and middle class works for money...the rich have money work for them.”
• “A job is really a short-term solution to a long-term problem.”
• “The primary reason people seek job security is because that is what they are taught to seek, at home and at school...then with debt loads, they must cling even tighter to a job, or professional security, just to pay the bills.”
• “When you work hard and become successful (in a job or career), that same success brings you less and less time...even if it does bring you more money...many just burn out.”
• “In moving to the business quadrant...your goal is to own a system and have people work that system for you.”
• “Job security is a myth...it is also risky for self-employed people in my opinion. If they get sick, injured or die, their income is directly impacted.”
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• “My rich dad teaches one to focus on passive income and spend ones time acquiring the assets that provided passive or long-term residual income.... passive income from capital gains, dividends, residual income from business, rental income from real estate, and royalties.”
For most of us the easiest way to produce passive income is through one of the three types below. Robert Kiyosaki outlines three types of businesses:
1.
A startup corporation - where you develop your own system 2.
Franchises - where you buy an existing system 3.
Network Marketing - where you buy into and become part of the existing system (for example Youngevity, Soul Purpose, nSpire Network, Total Life Changes, just to name a few.
The first two are the most risky, require the most capital and skills and are therefore beyond the average person. There are huge leverage advantages for the individual within the structure of a good network marketing company. For more information on home based businesses, network marketing and business opportunities, you can contact me directly via my website at www.mrsopportunity.info or you may e-mail me at diamondenterprisesinc@yahoo.com. I personally LOVE network marketing and I have been involved in the industry for a number of years now and I would not change a thing.
You may be asking, what is the purpose of my own business? The development of your own business represents the development of an asset (an asset is defined by Robert Kiyosaki as a vehicle that produces income). A business asset produces passive income i.e. it does not require your daily effort to produce the income. Passive 41
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income increases from the growth of your business and from increased tax sheltering of income available to business enterprises.
Sheltered surplus income should be reinvested within the business structure to create other forms of investment with passive income also. In simple terms, this is the method used by the mega-rich to accumulate their assets. You have to decide what you want financially and get a financial advisor to help you with your financial goals and create a plan of action.
My Story: I constantly struggle in this area. I am not a millionaire yet but I am working on it by building both traditional and network marketing businesses. It seems that there is never enough money to meet my needs or philanthropic/humanitarian desires. I realized after being burdened with credit card debt as a college student, that spending cash was far better than spending plastic. The credit card industry draws you in and then squashes you by hitting you with every imaginable and unimaginable credit card charge. By the time you realize it, you are knee deep in debt. I have been there, done that and I don’t wish the bill collector harassment on anyone. I have learned over the years that I must only spend what I can afford to. It is better to wait to get something you want when you can afford it, than to be in debt for the rest of your life. Your credit score is crucial to your financial health. The better your score the better your financial choices. Now let’s look at social health.