In the May issue of NY Magazine, there is an article which asks “Are You Suffering from Perfection Anxiety?” , which quotes an article by AA Gill in a recent Vanity Fair (I’d provide a link, but it doesn’t come up easily – too much traffic?). Though I assume the article is more than a bit tongue-in-cheek, it got me thinking about “comparanomics”(definition: having what someone ELSE has be the foundation for what YOU spend your time – and money – pursuing). As one art expert in the article points out: the return on a $60M piece of art is likely to be…below $60M – but doesn’t that assume it’s measured strictly in terms of $? What if the return was measured in impact: say the purchasers decided that the coast of installing complex security systems (or hire a manager or dedicated security person to watch over the painting) in their new LA home was more than they needed to pay – especially since they only intended to spend a month or so here and there in LA. So they decided to leave it in the museum where it resides – on the condition that they could close down the museum a few times a year for a select gathering of their closest friends and family – to get together, socialize and celebrate their great taste in art. So now, they have a beautiful painting, they have one less thing to worry about protecting, they will gain extra benefit (or at least studies show they have the potential to) and happiness by DOING something with the art instead of just HAVING it, and the museum will still have people flocking to see the art (in fact, attendance may rise because of the publicity). So: return = $ cost of art + impact? As they say in the MasterCard ad: “priceless”. How would that affect the perfection complex, I wonder?
“Literacy”, according to Webster’s dictionary, is “the ability to read and write”. So it follows that “Financial Literacy” is the ability to read and write numbers. When I first saw the term “Financial Intelligence” on the cover of the book by Karen Berman and Joe Knight, I thought “THAT’s what I’ve been looking for!” – because a lot of us can READ numbers, but what we really want to do is TRANSLATE the numbers and figure out what they are telling us. Right? Numbers are like a language – only easier: if I’m learning Spanish, I have to learn nouns, verbs and adjectives, feminine and masculine, past, present and future AND the grammar rules that give a sentence that wonderful rhythm – and meaning! Numbers don’t have tenses or genders or parts of speech – but they DO have meaning. Leave the complicated stuff to the professionals and learn the simple stuff: what is the story my numbers are telling me. If you need a translator at first, check out http://www.financedog.com or any of the books on “Financial Intelligence” at The Business Literacy Institute http://www.business-literacy.com. Before you know it, you’ll know your story – and you can begin to write the next chapters!
For a real light touch, if business books are not your thing, check out the Financial Intelligence graphic novel (okay – comic book) at http://www.business-literacy.com
A friend forwarded an email that he had received from the manager of his retirement fund, which included an article about “happiness”, with this recipe:
· Cultivating optimism/hope
· Avoiding social comparison (ruminating on what others have and we do not)
· Practicing acts of generosity and kindness
· Developing deep social relationships (versus an abundance of those that are superficial)
· Developing resilience/endurance through trials
· Practicing forgiveness (even more, forgiveness that is undeserved)
· Increasing “flow” activities – those where your gifts /talents are most utilized
· Savoring life’s joys (versus unbridled indulgence)
· Establishing purpose/setting goals
· Pursuing “spirituality” – acknowledging a power beyond oneself
· Physical and social activity – movement and engagement with those around us
As every media outlet I’m in contact with today is tempting me with all kinds of incredible deals – at incredible prices, I looked at this list – and it’s source – with some cynicism (see? – not cultivating happiness – yet). And yet, yesterday’s Thanksgiving celebration was – for me – a savoring of just one of life’s joys (with “bridled” indulgence): a gathering of friends to share – whatever each of us felt like sharing. So – that’s the point, isn’t it: I may eventually be able to do all the things on the list above, but for today, I just need do do one thing. So I’ll continue from yesterday and move and engage with those around me – though I’m tempted to stay by the fire, protected from the weather outside…
Years ago, my cousin Hap and I were talking about financial advisers and financial planners – we were both relatively new in our careers and wanting to do the right thing about saving for retirement – and saving, period. He told me that he had been working with “a guy” at Merrill Lynch for a few years and just that morning, his “guy” had called him to say that he was now a Portfolio Manager (a timeout, while I just clarify: a broker is someone who arranges a transaction between a buyer and a seller and receives a commission, and a portfolio manager is someone who makes investment decisions using money other people have placed under his/her control). My cousin said “So, Bob, what have you done in the last 12 hours that qualifies you to move from being a ‘broker’ to being a ‘portfolio manager'”. “I got new business cards.” Now, it turns out that Bob had the talent and he has done well as a portfolio manager for my cousin. But some of us treat people who manager our money like doctors: do what they say, even if we don’t think it is in our best interest. Do ask questions, check your assumptions, and take the time to find an adviser who you will be with for a good long time – it is worth the effort.
Check out Friday’s radio show:http://www.voiceamerica.com/episode/74185/is-your-advisor-listening
Last week I heard a speaker relaying the story of her early teaching experience -which she hated – and how THINKING more positively about her teaching actually made her more creative in her teaching and able to get out of her own way. She was still clear that teaching wasn’t for her and left the profession – but she left with achievement instead of bad memories. I’m an incurable optimist, so overall positive thinking comes naturally to me. But this got me wondering two things: 1. how many times a day to I think about money? 2. what percentage of those thoughts are positive? I honestly have no idea – but I do think about money a lot during the day: writing contracts for clients, doing the grocery shopping, listening to market reports – heck, listening to the news in general (the Budget, healthcare premiums, jobless/jobs reports), making travel plans for business or work – THINKING about making travel plans. Well, you know. And then my follow-on thought: if I switch negative thoughts to positive thoughts, what kind of happiness dividend over time because of my view?
So join me in an experiment – take a few pauses during the day to reflect on how often (in the last hour, in the last 4 hours – don’t make yourself crazy, but notice) you’ve thought about money. I’ll check back in next week with what I learn.
In the meantime, join us tomorrow to talk about the dark side of the personal financial industry with blogger, author, and researcher extraordinaire Helaine Olen. http://www.voiceamerica.com/episode/73942/pound-foolish
On today’s “Money In Your Life” radio show (link attached), Dr. Tim Kasser talked about his work studying the link between materialistic values and self esteem. He has done studies across the age spectrum, but important work with tweens and teens that have shown that, not only can you not buy happiness but that focus on status/image/money have a deep affect on a child’s self-esteem and on how that child shows up and functions in society. Listen to the show – and watch the short Youtube – to sort out what you can do, what your child can do and what advertisers can do.
The most straightforward definition of “budget” (n) is: “a plan for the coordination of resources and expenditures”. Hmmm. Coordination. What a great word – sounds so logical. And yet, the word “budget” tends to evoke the same emotions as “diet” (whose simplest definition is “food and drink regularly consumed”): feelings of deprivation and constraint. And the very thing you tell yourself you are cutting back on is the thing you can’t live without at that moment. So what if you don’t call it a “budget” at all? What if you make up a word or phrase that shifts whatever you feel when you say “budget” to something you like – “travel plan” – or make up a word that makes you laugh or feel good (“mugwump”?). Great. Now you have the label out of the way – what next? What is “normal” for a budget? Well, “normal” is having expenses that are less than income. But to really get at it, you can start with your income and the “50/30/20” split: 50 percent of your income is for housing and related bills (maintenance/utilities/insurance/rent or mortgage), 30 percent is for personal expenses (education/clothes/kids/entertainment) and 20 percent is for savings (emergency fund/debt repayment/retirement). And please note, I said START – the percentages can change depending on your values: maybe your housing costs are low and you choose to spend more on personal expenses – so you look more like “30/50/20” – or maybe you are focusing on paying down debt and saving as much as possible right now, so you look more like “30/30/40”. Wherever you are, just start somewhere and make a plan, and review it every month to see if it’s working for you The whole point of a budget or a mugwump or whatever you want to call it is to give yourself choices: you want to be proactive in your choices instead of reacting. Don’t take your cue from the government battles – “budget” IS a fighting word in that context. But in your house it doesn’t have to be.