The significant other of an acquaintance passed away and while I sent my condolences I couldn’t help but wonder how she would move through financially this year.  I kept thinking did he have life insurance?  Were they a two income household?  Did she depend on him to help her with paying the bills?  Of course these things run trough MY mind right?  I am praying that in this economy that she will be OK.

I turned to hubby and asked about our life insurance and I feel we should have more.  We don’t have children or any significant responsibilities so it’s not something I’ve ever really felt compelled to look into outside of what we have now.  But with talks of babies on the horizon and owning a home I want to make sure that we have everything in place.

So what do we get?  Term?  Whole? Universal?  How about the kind where we get some of our money back after a certain time?  Hubby has a medical condition, how will that factor into the monthly cost?  What policy gives us the maximum benefit with minimum monthly installment?  Can life insurance be used for retirement as the policy builds cash value?

Bankrate gives us the rundown here:

Term insurance – The simplest form of insurance. You purchase coverage for a specific price for a specified period. If you die during that time, your beneficiary receives the value of the policy. There is no investment component.

Whole life — Similar to term, but you purchase the policy to cover your “whole life” not just a set period. Premiums remain level throughout the life of the policy, and the company invests at least a portion of your premiums. Some firms share investment proceeds with policyholders in the form of a dividend. Many companies will offer “a relatively low guaranteed rate of return,” but in reality pay at a rate in excess of the guarantee.

Universal life — You decide how much you want to put in over and above a minimum premium. The company chooses the investment vehicle, which is generally restricted to bonds and mortgages. The investment and the returns go into a cash-value account, which you can use against premiums or allow to build. With some policies, sometimes called Type I or Type A, the cash account goes toward the face value of the policy on the death of the policyholder. With a second variety, sometimes called Type II or Type B, the beneficiary receives the face value of the policy plus all or most of the cash account. While Type II is meant to provide a partial hedge against inflation, it demands higher premiums as you get older than Type I.

A variation of a universal policy, often called universal variable life, allows policyholders to choose investment vehicles.

Variable life — With a variable policy, there is usually a wider selection of investment products, including stock funds. As with a universal policy, returns on investments can offset the cost of premiums or build in the account. And depending on the type of policy, the beneficiaries will either receive the face value of the policy or the face value plus all or part of the cash account.

Why should women be concerned?

From New York Life: Many women have either no or too little life insurance. Historically, women were almost never adequately insured. We all have different life situations so what does it mean to us?

• If you’re part of a two-income family: Today, 61 percent of married women bring home a paycheck (compared to just 23 percent in 1950). Husbands and wives are economic partners. Today’s two-income families depend on both pay checks to make ends meet.(Figures for 1995. Source: Washington Post 1/22/97) If anything happened to you — and the income you generate — would your family be able remain in their home? Would your children be able to achieve their education goals? Would your family suffer a severe financial loss? Adequate life insurance can replace your income, remove uncertainty and help guarantee your family’s financial security.
• If you’re a single woman heading a house-hold: Chances are that you have little if any life insurance, according to industry studies — in spite of the fact that you have major financial responsibilities. Of all life insurance policies sold in 1997, only 4 percent were purchased by divorced or widowed women.(“The Women’s Market: Myth & Reality,” LIMRA International, 1999) As a single parent, you may be the sole breadwinner, responsible for the support and care of your children. Your need for life insurance is even more crucial than in dual-parent households, which will have another source of income if one parent dies.
• If you’re a full-time home maker: Far from a dying breed, nearly two out of every five married women are full-time mothers and home makers. This is just as much a partnership as the two-income family in that it takes the efforts of both to make the household function. Your services, while in many respects beyond value, are worth tens of thousands of dollars a year. How would your husband and children manage without you?
• If you’re a single woman: Whether you’re single-never-married or divorced-no-kids-at-home, your need for life insurance may be even greater than for married women. That is because being single isn’t always the same as being without responsibilities. You may have loans. Plus, should anything happen to you, there will be final expenses, which can run into the tens of thousands of dollars. These obligations — which could fall on parents and other loved ones — can be met with life insurance. Just as important, life insurance purchased today can protect your future insurability as you get older. If you eventually marry, your coverage will help protect your husband and, possibly, children. If you choose to remain single, your life insurance can accumulate cash value to help provide a secure retirement for yourself. A cash value life insurance policy can help you accumulate funds on a tax-advantaged basis to supplement your other retirement income.

I’m sure the woman I spoke of at the beginning of this post didn’t think the death of her loved one would happen so soon or suddenly.  Death is never something we want to think about happening to those we love but in our wisdom we should make sure that we’re prepared for it nonetheless.

Financial independence is at the core of the American Dream. No one sets out fresh out of college with aspirations and hopes of being dead broke at the end of their life! But the unfortunate reality is that scores of people find themselves in significant personal and household debt by the age of 30. Fortunately, there is good news. No matter how bad your current financial situation is, there is hope. If you take the right steps today, you can still reach your financial goals and find true financial independence.

Paying Down Debt

The first major step a person must take toward gaining control of their personal finances is deciding to eliminate all personal debts. There is no secret formula to making this happen. You simply have to be willing to cut expenses, which may mean less eating out, less entertainment, and fewer shopping trips each month, and then you direct this extra cash flow toward paying down your debts.

Now, the most powerful variable in the world of personal finances is interest rates. Interest rates are an extremely powerful, but neutral force. They can work against you and keep you in financial bondage, or they can work for you and make you financially independent. Interest rates work against us when we are holding bad debts, such as auto loans, credit card debt, department store debt, small business loans, and even college debt. One common step that many people take when they get serious about paying off debt is to consolidate debt into one monthly payment through a debt relief program.

The Pros

If you consolidate your debt you will benefit immensely from a lower interest rate. Most debt consolidation programs will negotiate with your creditors and negotiate a much lower interest rate than you are currently paying. This will reduce the amount you are paying in interest to your creditors each month, which will in turn increase the amount you are paying down on your debt each month, which will then significantly decrease the amount of time it takes to pay off your debts. In the long run, a debt consolidation program will oftentimes help your credit because it will reduce your debt and your monthly minimum payments, which all affect your credit score.

The Cons

In most instances, you will suffer a moderate credit score decrease when you enter into a debt consolidation program. The amount of points that your credit score will suffer largely depends on the type of program you enter. It should be understood, however, that this is a short-term effect. In the long-term your credit, as stated above, will improve.

A second major drawback to a debt consolidation program is the result of a missed payment. Instead of having your debt payments spread throughout the month with your small business loan at the beginning
of the month and your credit card payment mid-month, you will be making one lump sum payment each month. If something happens and you do not have those funds available the day your debt payment is due, the ramifications can be quite severe. The exact effect of a late payment differ program to program, but oftentimes it can cause your interest rate to soar, and you may even be kicked out of the program.

Debt consolidation programs can be an excellent solution to help lower your monthly interest rates, which will in turn speed the process toward true financial independence.

Jason Hoerr is an entrepreneur, trader and writer for SmallBusinessLoansDirect.com based in Charlotte, NC

Yes, I know we’ve discussed this topic ad nauseum here and where the post first went live as a guest post at Consumerism Commentary.

In my defense of bringing this up again, I was contacted by ABCNews to discuss my views on marriage and money as it relates to the book: Smart Girls Marry Money: How Women Have Been Duped Into the Romantic Dream–And How They’re Paying For It.

And, while I think certain phrases are used mainly for shock value to pull the reader in, I generally agree with the premise.  Don’t let sensationalized romanticism be your sole guide in choosing your life partner.

If you meet a guy who has a string of debts from New York to Colorado and has no sincere intention (not wherewithal) to repay them, then run like you stole something!  Seriously, how a man treats his finances — if he is not willing to honor his debts and obligations — is an indicator of how he will treat you in the marriage.  I take this as a character flaw and not one I am willing to put up with in the marriage.  Call me what you want, but I am not that girl.

Still, I’m also not saying that you should walk into a marriage thinking that if you bring your looks and he brings his wallet then all is well and done in the land of happily ever after either.  Let’s keep it real here ladies, your looks will fade over time and he will continue to make money.  What will you do when he decides to trade you in for the latest Aston Martin?  Become an asset to your partner and not a liability, coming to the table with only your looks makes for a bad business deal in which you’re just a depreciating asset.

Real Talk.  My goal is to keep it real with you here and not fill your head with gold digging dreams of snagging a guy solely for his money and thinking that you will be nothing more than a trinket in his box of tricks. If you’re going to do this anyway, be smart about it, go to school, get some business acumen and make it a learning experience.

Too many women find themselves penniless and poor after being dumped by a wealthy partner with no real concrete plan around how they would get back on their feet.  Here’s a hint, walk in to your relationship with an education and a plan because prince charming doesn’t exist and a man is not a backup plan.

However, while I do advocate making sure you’re partner is financially viable, please don’t go into the relationship only checking this box, make sure he is loving, respectful, shares your emotional values and someone who you know you can spend your life with through thick and thin.  Love, not money gets you through hard times.

Here are a few excerpts which, frankly tickles me to see this in print…. *snicker*…the authors are BOLD!  LOL

Now, while I disagree with pushing women to use their feminine wiles to snag a man solely for money, I do agree with making sure that you wont be broke and in the poor house because you decided to marry a financially irresponsible partner.

Thoughts? 

This article was originally published on Jun 8, 2009 and updated on March 10, 2012.

The new year is around the corner and we’re all thinking about how to make better decisions so that we come out of top financially.  Take a look at the list below and incorporate a few, if not all into your daily financial life.  Commit to being a better steward of your finances and you will certainly reap the benefits.

1. Create Your Financial Plan  and spend some time each week developing and reviewing your plan to make it happen.  With every financial transaction, top of mind should be “how does this fit in with my financial goals?”.
2. Daily: Take 10 minutes to review your main accounts.  Make certain that all charges are accurate and review any purchases you may regret later.
3. Weekly:  Review all transactions to help you stay on track with your financial goals
4. Monthly:  Review your accounts to make sure that all bills were paid on time or are scheduled to be paid.  If the funds aren’t there then call the institution to alert them of an expected payment date or work out a payment plan
5. Quarterly:  When creating your financial plan, create milestones that benchmark your progress.  For example,  If your plan is to pay off $10,000 in 12 months then by month 3, you should have $2500 paid off.  If that doesn’t happen then it’s time to readjust the plan and move the goal or play catch up.
6. Write down your financial goals.  SMART Goals are the best way to orchestrate success in this area.
7. Set your finances on autopilot.  Set up every recurring expense using Bill Pay or via ACH draft.
8. Create a goal statement:  My intention is to ________________ in order to achieve financial freedom
9. Spend less than you earn
10. Save 20% of income for savings and retirement
11. Pay down non-mortgage debt to less than 15% of income
12. Think long term and spend time in fruitful investments for the future, for example: start a business
13. Read at least 1 personal finance book every month.  Keep abreast of emerging financial issues that impact your life.
14. Be mindful of emotional spending.  Shopping when you’re sad, mad or depressed often leads to purchases you’ll regret later.  Address the core issues, as emotional spending only slaps a temporary cover-up on the problem.
15. Spend more time with others who are where you want to be financially.  Doing this helps you compare and contrast how you operate with money in comparison to them while helping you make changes along the way.  As my pastor likes to say, seek those who have your solution and get away from those who have your problem.
16. Everyday, day dream and feel what it will be like when you reach your financial goals: debt free, 6-12 months of emergency fund savings-whatever it is-dream about it, talk about, write about it and make it happen.
17. Buy things that will last longer than it takes to finance them.  If you finance a TV (you really shouldn’t!), then it should last longer than the time it takes to pay it off.  This goes for anything, whatever you buy should still be useful 6 months from now.
18. Give back.  This can be with your time or money.  Spend time time giving back to others less fortunate than yourself.
19. De-clutter your finances.  What are some things that you’re paying for (magazine subscriptions, extra trips to the makeup counter, techie gadget impulse buys) that leech money you really need to hit your financial goals.
20. Spend time in the future.  Leave financial regrets in the past as they took place in order to teach you lessons for the future.
21. Financial problems teach you the life skill of problem solving.  If you can dig yourself out of financial ruin, then you’ll be surprised as how you face life’s other challenges.
22. Research account aggregation tools and commit to monitoring your money on a consistent basis.
23. Every dollar in your budget needs a job.  None should be idle and without purpose.
24. The coming financial year won’t be perfect.  But commit to learning from your mistakes to avoid making them again.
25. With financial freedom comes peace of mind.  Work towards this and see how everything else in your life falls into place.  Money problems are often the root of other difficulties in life including health and relationships with others.
26. Don’t compare your financial situation to others who are in a better position than you are.  Remember, like you they had to work to get where they are and if you take anything from their situation, it is that you can one day be financially free yourself.
27. Find peace with your financial past.  You may have had some situations that put you in a financial hole but the best part is as long as you’re alive today, you have another chance to make things right.
28. Make some hard decisions about your spending habits.  How will you Tame Your Achilles Heel?  The more insight you have into this area, the better decisions you’ll make.
29. Find ways to earn more money.  Developing multiple streams of income is key to financial freedom.
30. Your friends won’t bail you out of financial ruin if you continue to make bad decisions.  If spending money on happy hours, eating out and partying on the weekend take you away from your intended financial goals then it’s time to reassess how you spend your money and time.
31. Do the right thing!  Avoid “because I deserve it” and “I’m stressed and need retail therapy” purchases.  You’ll almost always regret them and they do nothing to fix the core issues.
32. Enjoy this time in your life.  There are many life lessons to be learned.  Spend this time not only about creating a budget but how you got here and the plan to move forward and not fall back.
33. Sell anything that you haven’t touched in 6-8 months and pay down debt or plug into savings.
34. Discuss your financial plans for the coming year with your partner or spouse.    Make sure you are both on board with goals and how you will address setbacks.  Commit to reviewing goals weekly, monthly and quarterly.
35. Start having weekly “family meetings” with each other (couples) and monthly with your children.  Part of these meetings will address family finances which discuss spending habits and financial goals.
36. Teach your children about the benefits of entrepreneurship.  Instead of another Elmo, PS3 or XBox, give them a gumball machine that they will own and operate.  This teaches them the inner workings of how a business is run while learning the world of business at a young age.
37. Give children gifts that will last long past the next birthday: create a college fund or add money to a college fund

What are some tips you have for leading a healthier financial life?

Most people see buying a home as a part of the “American Dream”, well for most it’s become a nightmare.  Buying a home is pretty much the best way to throw your money away and here’s why.  Renters win because they have the flexibility that homeowners do not and after 30 years alone of paying interest to the bank, you’ve lost out on any potential monetary benefit.

You never truly own the home.  Even after paying off the mortgage, there’s still property taxes, HOA fees, home insurance and other mandatory costs which make buying a home a veritable money pit. You must consider every single penny that you spend in direct or indirect relation to the home.  5 years ago, real estate investors would only consider the purchase price and subsequent sales price to determine the profit made.  Nowadays with reduced and nonexistent equity, investors are looking at every penny to determine whether or not the deal is worth it.

• Renters only rent.  No HOA fees, property taxes, home insurance, home repairs or any other cost usually handled by the landlord.   The counter argument here is that the landlord rolls all of these fees into the rent.  However, consider that while this may be true of some rentals, it is not of all rental.  In some cases, doing this drives up the rental rate which makes it unattractive to most renters.   Consequently, there are many landlords who eat the cost of extraneous fees as it is better to have someone in the unit than have it empty. 

There is no guarantee of a “permanent home” with home ownership.  As we’ve seen with the recession, should you lose your job and exhaust all reserve funds, you are out of luck and that home will be sold to the highest bidder.

• Renters can usually rent for as long as the landlord will allow or needs a renter in the home.  If a renter loses a home, there’s the option to get a cheaper rental until things get better.  When you own a home, even if your financial situation changes, you must continue to pay the mortgage payment as agreed upon during closing.

Buying a home locks you in for as long as you own the home.  Think you’ll just sell it?  Fat chance.  Given that most homeowners who bought their homes in the last 10 years are underwater, good luck.  Though it isn’t impossible, the only chance of getting out is to strategically default or sell via short sale if you’re underwater.  Both options trash your credit since the originally agreed upon balance isn’t what the bank receives in the end. 

• Renters on the other hand are free to go at the end of the lease which can be month to month upwards of 2 years.  There’s also the option to break the lease with a fee paid which equates to 2 months or that may be waived if the renter or landlord is able to find someone to replace the renter.

Today’s economic conditions require a 20% down payment.  In some areas, this can be as much or more than $100k for a starter home.  Once you sink the money into the home, you don’t see it again unless you’re lucky enough to sell at a profit.  This is a gamble and unfortunately, many homeowners come out on the losing end.

• Renters only need to put down the 1st month’s rent and security deposit. The latter is returned at the end of the lease term.

Home ownership is no longer an investment.  With the recession, this became a daunting reality for many homeowners.   Home equity became non-existent which meant kissing good bye the good ole “forced savings” theory.  For this reason alone, renters come out on top since the lack of an investment potential makes the argument that buying is more advantageous a moot point.

• Renters in this case, just pay rent with no expectation of long term investment potential.

Homeowners are responsible for the cost of all repairs and upgrades.  This is self explanatory.  As a homeowner you are responsible for every single repair that comes your way, renters only pay for repairs that are a result of intentional damage or negligence.  Otherwise, the landlord pays for everything.

• Renters don’t deal with repairs unless the resulting damage is their fault. 

What’s your perspective on renting vs buying?  This is an age old debate that’s certainly changed it’s course over the last 3 years.  Which side of the fence are you on?  Renting or buying?

As we ramp up financial plans and resolutions for the new year, we’re all looking for ways to make extra money.  It’s no secret – if there’s debt to be paid, there’s money to be made.  Check out the following ways to make extra money while putting a dent in your debt or better yet saving for a rainy day.

Pet Sitting, Especially Overnight Pet Sitting

Pet sitting is a great money maker as pet owners are willing to shell out the cash to make certain their pets don’t lose their furry minds while they are gone on vacation or just away for the weekend.  The hours are convenient for someone who already has a 9-5 as the overnight portion typically starts late evening and goes into the next morning.  The rates for this can run upwards of $50 per night if you own your own pet sitting business.  If you go through a pet sitting service then you can expect to net around 25%-50% of the total fee paid by the owner.  If you have the time to attend to the pet during the day then there’s extra cash in this as well: walking, cleaning the litter box, administering medication etc

Mystery Shopping

Mystery shopping is a great way to earn money during down time since it requires very little effort.  Many companies allow you to sign up and get started on the same day which is great since you get the cash within 1-2 weeks after your assignments have been completed and verified.  EMPSonline.com has always been a consistent place which lists “shops” that pay $40 per shop.  The best part?  They offer direct deposit and the ability to submit your reports online.  This streamlines the process and lessens the time between starting a shop and getting paid.

Sell Old Stuff On Ebay And Craigslist

Ebay and Craigslist are great for selling old stuff.  Your trash is another man’s treasure and they are more than willing to pay you for it.  Go forth and list your items there and get your money!  Another tip?  You may sometimes come across an item that is grossly under-priced on Craigslist and sell it on Ebay if you’re willing to ship it to someone in another state.  This tends to be the case with so computers and other electronics if the person is desperate to get rid of it.  This is also found this to be the case with exercise equipment.  Ebay tends to pull bidders into a frenzy towards the end of the auction so if you have an item that most people are searching for then buying low on Craigslist and selling high on Ebay may be the way to go.

Date Night Childcare

If you love children, then this is a great option!  Market yourself to local parents as the date night solution.  Parents of young children are always looking for trustworthy and reliable people to babysit so that they can have a few needed hours to themselves.  Offer overnight babysitting and you’re in it to win it!  Parents appreciate it and you will certainly be passed around to their friends to do the same.  Tip:  It helps if you’re CPR and first aid certified.  Parents want to know that if something happens that you know how to tackle the situation with skill.

Get a 2nd Job

Right now it may seem that jobs aren’t plentiful but there are indeed many lower paying jobs that you’d be surprised aren’t being filled.  This is to your advantage as you may be able to negotiate better hours in exchange for filling a position, especially during the holidays.

Make Your Hobby Your New Money Maker

What do you spend most of your time doing?  Take that and make some money doing it!  This isn’t always immediately obvious, so take some time to think about how you can combine 1 or a few of your passions into something that can net you some cash for a rainy day.  For example, if you have a Type A personality and love organizing spaces then advertise yourself to friends and family as an organizer.   The same goes for make up.  If you happen to do makeup really well then market yourself to local brides as the makeup guru to get their faces done on the big day.

Start A Bath and Body Products Company

Don’t gloss over this just yet.  There’s a huge market for naturally made soaps, creams and perfumes.  If you can find a good supplier for unique and quality scents with a fresh base then you are set. The drawback of this is of course becoming too popular and then falling behind on orders since they are handmade and made to order.  Research this opportunity carefully and thoroughly.  One should only enter this arena if they truly have a heart of creating lovely smell goods!

Tutoring

This is pretty self-explanatory.  Put flyers up at local schools and post and ad on Craigslist detailing your specialties and rates.  It helps to have great references and the ability to coach children through difficult topics while helping them learn the information in a way that they are unable to in class.

Earning extra money may seem difficult, but put some thoughts into where your energy will be most profitable prior to jumping in.  What are your best money makers when you need extra cash?

It’s that time of year again and we’re in the mindset where we begin to think about the things we’d like to do better next year.   Financial resolutions are often high on the list with much “spend less, save more” promises that never seem to quite make it past Valentines Day.

Plan For The Future

Create A Financial Plan:  Getting started with improving your finances requires first developing a plan for success.  A financial plan is the foundation upon which all your plans exist.  Without this plan, it’s impossible to have goal directed success as it relates to your finances.  This helps you decide whether that purchase you’re about to make coincides with your values and goals.  So in essence, it becomes the compass that helps you get to your wealthy destination.

Action:  Use this financial plan template to get started.  Fill it out as directed and then use it to guide your plans for the new year and beyond.

Budgeting

Develop a budget or spending plan that actually works for you based on where you are right now.  Don’t go cold turkey if you know that won’t work for you.  Instead, try reducing your spending in critical areas slowly until it “feels right”.  One mistake we often make us cutting these out cold turkey which actually backfires down the road.  Unless you have really good discipline, slowly but surely wins this race.

Action:  Get started here!  Need a budget template?  Check these awesome budgeting templates from Budgets Are Sexy.

• Take a look at your spending over the last 3-6 months by aggregating your accounts into Yodlee
• Check where you’ve fallen short, for example spending $500 on happy hours and eating out which leads to your account being overdrawn, well you might want to start there.
• Decide how much you need to cut back in each category.  Start off with $250 for the above-mentioned example.
• Create a new budget based on the template you select here.
• Use the next 2 weeks to test drive your budget.  Review your spending weekly to determine where you need to tweak things a bit.  This is an ongoing process, but as you go along, it gets easier.

Get Your Credit In Check

Check your Credit for errors, collections, judgements, late payments and possible liens.  If necessary, start the credit repair process in order to remove derogatory items.  Sign up for a credit monitoring service that will allow you to consistently and actively manage your credit so that you aren’t blindsided when applying for new credit down the road.

Develop a plan to begin the credit repair process

Decide which debts you will pay off and what other accounts need negotiation around a new payment plan for settlement or removing late payments in exchange for paying off the whole balance.  Tip:  If the account has already reported on your credit report, call when you have enough to pay half, more than half or the whole balance.  This way you have leverage and better able to negotiate removal of the derogatory information.  This agreement must be given to you in writing.

Action:

• Check your credit report.  There’s always a section which lists your creditor’s contact information.  Call them to discuss the account and what possible remedies are available to you.
• For the accounts that you have decided to pay off.  Check out these debt reduction strategies and see which one works for you.  The debt snowball method tends to be the most popular but it may not work or be appropriate for every situation.

Schedule Time With Your Money

Set up a time to review the above-mentioned tasks every week.  Staying on top of these issues develops a habit that you’ll need in order to cultivate financial discipline.

What are your financial resolutions for next year?  How have you fallen short this year and how to you plan to change things next year?

In our next series of Avon interviews, I had the pleasure of interviewing Avon superstar, Denise.  Like Becky, she makes money selling Avon products to friends and family and has tons of fun doing it!  While interviewing Denise it became immediately clear that we share many of the same values around women and money which made this interview easy with many “yes, me too!” moments.

What’s Her Story?

Denise is a mom who has been selling Avon for about 3 years now.  She happened upon Avon due to the pending birth of her son, however she’d recently lost her job. While feeling at a loss for how she would support her family, Denise decided to follow through on a local advertisement she saw for Avon.  Feeling that she was failing her son before he was born due to losing her job, she honed in on her survival instincts because she had a new child to support.

One key selling point that helped her make the decision is that selling Avon means selling something that someone else makes.  This means no time spent creating the product, being an Avon representative means that the product is ready to ship while making a higher margin.

21st Century Avon

A common theme in our interviews is all of the representatives feel that Avon has certainly turned the page and is no longer “your gramma’s Avon”.  Avon is cool, fresh and appeals to a wide audience of women which spans generations.  Some of us grew up with our moms selling Avon for extra cash and for many this played an integral part in supporting their households.

For Denise this was no different.  At the time, she was in a place where she was dependent upon the income from Avon to support herself while giving her the time and flexibility needed with her newborn son.

She describes herself as her own best customer and tells me that “people don’t know how much Avon has to offer.“  From “perfume to panties”, Avon sells everything a woman needs to feel sexy, sophisticated and pretty at the same time.

Flexibility

When asked what she likes best about Avon, Denise replied that the flexibility this offers is top of mind.  This isn’t a job where she would have to sell, sell, sell while under high-pressure deadlines, she is able to sell as little or as much as she wants with no threat of losing her job.  She often remarked about the sense of freedom because no one can fire you and you set your own financial goals.

Advice For New Avon Representatives

Denise tells me that for new Avon reps, the sky is the limit as they have nothing to lose.  They start the business for $10 and there’s no need to buy any inventory as with other businesses.

• Timing is important. Representatives should buy products ahead of time for customers that will use them.
• Think strategically.  You’re your own boss.  Be disciplined about the hours you put into it.  Make decisions that will be profitable.  Buy things that you know will sell.  We both agreed that in order to be successful at any business it is important to treat it like a business, not a hobby.
• Commit.  Dedicate yourself and your time to the venture.  Get on a  schedule and know what you want to get out of it.
• If you aren’t your own best customer then you’re losing money.
• Make it a lifestyle, not a job.  When you truly love what you’re selling it doesn’t feel like a job.

How Does AVON Help Denise Reach Her Financial Goals?

Now that Denise is in a better place financially (recently secured a FT position), everything she makes from AVON is “me money”.  This includes everything from massages, eyebrows, Christmas gifts or just extra spending money that she would not have if Avon weren’t  a part of the picture.  This adds to her feeling of independence as she remembers that only 3 years ago she had lost her job and today, thanks to Avon she is feeling more independent.

What are your thoughts on AVON and the opportunity to set your own schedule and make as much or little as you want?

Disclaimer:  I am a paid brand ambassador for AVON. My views are my own and do not necessarily reflect the views of Avon and its affiliates.

With the new year upon us in a few weeks, you may be thinking about jump starting your finances.  This is pretty common as people tend to engage in a review of their financial life around this time of year in an effort to make resolutions.

Your financial plan may be one of those elusive resolutions and you may be even thinking, “5 years is too long for me to “plan” but in reality it isn’t.  We aren’t addressing what to do when you reach retirement or any other really long term goal.  Think of 5 years as the standard.

Check out the following tips on how to create a financial plan you can stick with!

Create A Foundation:  Discover Your Values

What are your financial values?  Do you want to get out or stay out of debt?  Would you like to travel more or start/ramp up a hobby?  Own a home?  Start a business?  Answering and incorporating these into your financial plan will help you set up a foundation which guides your plan through the end.

Develop A Few Concrete Financial Goals

SMART goals apply here.  Specific, Measurable, Achievable, Realistic and Time Specific.

SMART Goals Overview

Specific

• Start off by being specific in your goal. Clearly define what you are going to do. Include the what, why and how.

Measurable

• You must be able to measure your goal in order to manage it. I will pay an extra $200 towards my credit card is better than I want to be debt free.

Attainable

• Your goal must be attainable, although it should stretch you to reach the goal. You can’t possibly pay down $19,000 in debt when you only earn $15,000 for the year.

Realistic

• A realistic goal is one that will stretch you but not impossible. Completely cutting out all entertainment and eating out isn’t realistic for most.  But starting my reducing the amount of money spent in this area is more realistic.

Timely

• A timely goal will give you a clear target to work towards. You may choose a week, a month, a year, just make sure that the time is realistic.

Save $1000-$5000 for an emergency fund. 

This is only to be used in emergencies and may vary depending on your lifestyle and needs.  So it’s OK if you need to save more like $2500.  If you have a larger family and expenses, then $5000 may be a more comfortable number for your situation.

Pay Down Debt, Avoid Digging Deeper In Debt and Save for 1 Month’s Living Expenses

Check out these debt reduction strategies and see which one works for you.  The debt snowball method tends to be the most popular but it may not work or be appropriate for every situation.

Save towards 6 months of living expenses

Once your debt has been paid off, work towards saving 6 months of living expenses.  Most “personal finance experts” recommend a minimum of 3 but given the economic factors, let’s go with 6.

Start Investing In Long Term Goals

This can include retirement, college education, owning a home or anything that warrants a longer term investment of time and money.  One thing to note which goes against Dave Ramsey’s advice in this area, put your retirement ahead of your child’s college fund.  Check out the following compelling reasons from Christian Personal Finance:

1. You have only one chance to fund your retirement.
2. You will force your children to set their own priorities.
3. Success is not guaranteed by a piece of paper.
4. Your child might not graduate.
5. Your child may need to support you in your senior years.

 

Think hard about whether or not it will be a worthy endeavor to save for your child’s college education.

Create a will

Make certain that you create a will so that your affairs are in order upon your passing.  This is a topic no one really wants to visit until it is too late but doing this now will put your mind at ease.

Check out this template from David Bach which should give you more of a visual of what the plan should look like:

(click to enlarge)

My personal financial plan:

• Become debt-free with the exception of a mortgage and student loans.  Both are pretty large and unless I hit the lottery then, I’m stuck.
• Save for a $60,000 emergency fund.
• Work towards at least $100k in retirement savings which I am behind on due to debt
• Reduce my expenses to the minimum, just above bare minimum.  I still want to travel and enjoy life, but there are a lot of extras right now I can stand to do without that don’t necessarily enrich my life.  I’d like to spend money in more meaningful areas of  my life that will create lasting memories.

Have you created a financial plan?  If not, what has stopped you from creating one?   If you do have one, what are the values and goals that drive your financial plan?

There was a time when I cared about these things we tend to call holy grails of personal finance.  You know, obsessing about checking your credit score, buying a home – those things that cause you to rack your brain at night if you’re one these personal finance types who cares about these things.

I stopped caring a long time ago because in the grand scheme of things they don’t affect how I sleep at night.  At one time yes, but these days?  No.

Car Insurance

There was a time when I cared about how a speeding ticket would impact my car insurance rate.  When pulled over I would going into a long diatribe with the officer about how this would affect my insurance rate.  Those were the days.  But now it doesn’t really matter as much to me.  Any tickets I’ve gotten have not impacted my insurance rate as they’ve gone down for each year.  I pay around $60 per month.  Even during the years when I was more a speed demon than I care to share here   Even if it did, car insurance is just one of those I hate to deal with but can’t live without if I drive a car.

Credit Score/Checking My Credit Score

I used to obsess around checking my credit score.  So much so that I was getting new scores every 2-3 months.  Now that I use cash for everything that doesn’t matter so much any more.   Now, keep in mind, I have never had a late payment EVER but I still have debt   It is what it is and losing sleep about it isn’t something I plan on doing again.  I have a plan to pay off my consumer debt in a few months but I’ll still have student loan debt *shrug*

Buying a Home And Living The American Dream

Been there, done that and have the underwater t-shirt to show for it.  I keep saying to my husband that I don’t think we will ever buy another home.  Please don’t write about the tax benefits either because when you break down the dollars you really don’t come out on top.  Property taxes, maintenance, HOA fees etc- all things you pay just to get the holy interest which magically gives you a  better financial life with the deduction.  I just don’t believe in the good ole American Dream which tells us that you have to buy a house in order to live it.  I’ll pass.

Carrying Huge Debt

Being 6 figures in student loan debt used to be something I was ashamed to admit.  As you probably guessed, now I don’t care LOL  I try to live my life free of shame and while it is something I don’t enjoy, it’s a part of my life,  I’ve learned an expensive lesson.   I’ve seen other PF bloggers and readers ashamed to admit it but guys, it’s here, admit and accept it.  It only shapes who you are if you can’t own up to the reasons why you ended up with the debt.  Let that go, because Sallie surely needs her money and she isn’t letting you go.  Like others I am working on this area of my life and don’t profess to be an expert.  However, while working on getting out of debt, it isn’t something I plan to lose sleep about.

Coupon Clipping/Extreme Couponing

This is a waste of time for me.  Time=Money and I refuse to spend hours clipping coupons to save a few cents while buying crap I don’t need again in the name of “I bought 23 toothbrushes for $2.60!”

Being Frugal

I hate this term.  Being frugal=cheap and I hate cheap anything.  I like to think of it as having more wisdom as it relates to my spending habits.  Frugal means shopping the sale rack for clothes that no one wanted so they are now marked down.  Being wise means waiting for the very coat I’ve wanted for months to go on sale.  The difference is waiting to get what I want instead of waiting for everyone else to get what they want and then pick up leftovers at a bargain in the name of being frugal.  Same thing with shopping for food.  Being frugal means buying some cereal I don’t normally eat on sale when all I can do is get what I want and when it goes on sale great, but otherwise I get what I want.

What do I obsess about?

• Having An Emergency Fund-for obvious reasons
• Paying down debt

I don’t lose sleep over these items either but they remain priorities for the present  time.

What are your holy grails when it comes to money?