What’s Your M.Q.?

Do you know someone who is really smart, but makes really dumb decisions when it comes to money?  These individuals are likely to be successful in other endeavors, but their financial lives are out of kilter.  Here are a few examples:

  • Joan has a great job and earns a six-figure salary. Even though she gets a generous raise each year, she can’t seem to be able to save and invest for her future.
  • Three years ago, John received a large inheritance from his grandmother. If well managed, her generous gift could provide John financial security for the rest of his life.  However, he feels anything but secure.  The responsibility of financial stewardship has challenged his self-confidence and triggered anxiety attacks and depression.
  • Tina recently graduated from law school and landed a position in a top firm in San Francisco. Although she was offered a very competitive starting salary, she finds that it is inadequate to meet her living expenses, car payments, and student loan payments.  After all the sacrifices she has made to reach this career goal, she is angry and frightened about her financial outlook.
  • Tim wants to micro-manage the family budget and it is driving Karen crazy. They have been married five years, and Tim’s attention to their money matters is becoming increasingly obsessive.  To assert her independence in this relationship, Karen frequently goes on shopping sprees.
  • Ken checks the market several times a day. On down days, he is filled with anxiety about his shrinking retirement nest egg.  Recently, after several days of steady declines, the Dow precipitously dropped another 300 points.  Ken immediately called his broker and demanded that she sell every one of his investments and put the proceeds into a money market.


Values & The Meaning of Money

core-values-nov-2015Values are the essential meanings relating to what is desirable or has worth. Like “quality of life,” values are subjective in meaning and unique to each individual. In a nutshell, our values reflect what matters most to us.

When thinking about values, we often think in terms of principles or standards we consider important such as “honesty,” “loyalty,” or “altruism.” We also tend to think of values in terms of what we hold most dear such as “my family,” “my faith,” or “my health.” (more…)

Business Succession Issues: Understanding Buy-Sell Agreements

business-succession-planningRunning into financial troubles isn’t the only reason that some closely held businesses fail to succeed. Their untimely demise may result from the lack of a formal plan providing for the orderly succession of management and ownership of the business. Such a plan frequently incorporates a buy-sell agreement as the tool for ensuring that the business will continue even after the departure, death, or disability of an owner.

To head off future problems, it pays to understand the uses and structures of these agreements. Although they can be adopted at any time, it is best to decide whether to put a buy-sell agreement in place as early as possible in the life of a business. (more…)

Allowances: Tool Or Tyranny?

allowanceIn her blog “Good Thinking,” research psychologist Denise Cummins explains why the topic of allowances raises such a high level of concern and confusion for parents.

Allowances are powerful things. They are a child’s first exposure to the power of personal choice that financial means can bring. It is for this very reason that parents approach it with a mixture of fear and trepidation.

To some, it is the quintessential way to teach children financial literacy as well as character traits like patience, thrift and generosity. To others, however, allowances are dangerous things that take away parental power and authority, and teach nothing more than greed.


Better Financial Advice: New Approaches Gain Traction

new-financial-approachesFinancial Therapy

Getting people to feel less stressed when thinking, talking, and making decisions about money is the goal of Financial Therapy; a combination of psychology and financial advice that is focused on developing healthy relationships with money.

While a financial counselor usually comes in at a point of crisis—like bankruptcy or intractable financial conflicts between spouses—the role of a financial therapist is to help us understand the stories we tell ourselves, true or not, about money. These “money scripts” usually reside outside of our consciousness, and act as an invisible force guiding our thoughts, feelings, and decisions about money.


Values Define the “Rich” Life

values-hands-familyFinancial Life Planning is a holistic process that will first help you to clarify your values and then guide you in defining and designing your unique version of the “rich” life.

When thinking about values, we often think in terms of principles or standards we consider important such as honesty, loyalty, or altruism. We also tend to think of values in terms of what we hold most dear such as family and good health.