The Women and Money Myth

It used to be ‘Diamonds are a girl’s best friend’ was the acceptable message. Money has always had a somewhat tarnished reputation with words like ‘money-grubbing’ setting the tone. It is therefore not surprising to see articles with titles like why women “switch off” over money.

Financial literacy reports continue to tell us that Australian women simply “switch off” when it comes to finance. The Women Understanding Money report found 52% of women find dealing with money stressful and overwhelming, 25% have absolutely no savings for retirement and of the women who do invest, only 5% look at a company’s background information. Is this switch off factor just because we find talking about money boring and unimportant, or is there something else going on?

Even in discussions with high-earning, independently successful women, many women weren’t really tuned in to their own personal finance situation.

Perhaps the reason women don’t tune into their personal finances as much as men do might be because of the different ways of measuring success. Men, from a very young age, compare their salaries and the increasing value of their investment portfolios, and are more likely to spend money on expensive cars as a symbol to the world that they are a success. Conversely women spend so much time worrying about their children, partners and parents, they seldom have time left over to focus on themselves, and their own finances and investments.

There has been a historical exclusion for women in dealing with money in the not-too-distant past. Many women grew up with the expectation that women would rely on men for their financial security.but this is now changing. Women are now much more independent, both socially and financially. If women lack the confidence, the experience or the interest to get involved, then now is the time to change all that.

Women must seek out sound financial information and not hang on to the money myths they may have inherited from Mom, according to MP Dunleavey. Discussions with women make it clear that their mothers are often powerful financial role models. Unfortunately that can be for better or for worse.

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Knee Deep in Debt

In doing research on the previous post titled, Making Money Go Further, I was struck by the title, Knee Deep in Debt.  This is actually a most useful article from the Federal Trade Commission in the US.  It is very straight advice for those who perhaps are struggling and feel they are mired in debt.

As it mentions, many people face a financial crisis at some time in their lives. Whether the crisis is caused by personal or family illness, the loss of a job, or overspending, it can seem overwhelming. But often, it can be overcome. Your financial situation doesn’t have to go from bad to worse.

They then discuss a number of options that may be helpful depending on the level of debt, the amount of personal discipline, and  the prospects for the future.  The options that they cover in some detail are:

  • Realistic Budgeting -  The goal is to make sure you can make ends meet on the basics: housing, food, health care, insurance, and education.
  • Credit Counseling from a reputable organization -  If you’re not disciplined enough to create a workable budget and stick to it, can’t work out a repayment plan with your creditors, or can’t keep track of mounting bills, consider contacting a credit counseling organization.
  • Debt Management Plans – A DMP alone is not credit counseling, and DMPs are not for everyone. You should sign up for one of these plans only after a certified credit counselor has spent time thoroughly reviewing your financial situation, and has offered you customized advice on managing your money.
  • Debt Consolidation – You may be able to lower your cost of credit by consolidating your debt through a second mortgage or a home equity line of credit. These loans require you to put up your home as collateral. If payments are not made on time you could lose your home.
  • Bankruptcy – The debt management option of last resort because the results are long-lasting and far reaching.

As they caution, if you’re thinking about getting help to stabilize your financial situation, do some homework first. Find out what services a business provides and what it costs, and don’t rely on verbal promises. Get everything in writing, and read your contracts carefully.

A good agency will cover not only debt counseling, but will review the family budget and advise on the best way to manage personal finances and pay off credit card debts.  It provides detailed financial education on money management, household budgeting and other issues that affect credit ratings.

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Ponzi Schemes, Madoff and More

If you are looking for information on Ponzi schemes, I thoroughly recommend The Ultimate Guide to Ponzi Schemes.  It is the compilation of a great deal of research on Ponzi schemes with links to all the resources.

I found the following top ten list of Ponzi schemes from Business Pundit of particular interest:

  1. The Namesake: Charles Ponzi
  2. Madman Madoff: Bernie Madoff
  3. The Retiree Plunderer: Michael Eugene Kelly
  4. The Boy Band Bandit: Lou Pearlman
  5. The Biblical Bilker: Gerald Payne
  6. The Costa Rica Crooks: Enrique, Osvaldo and Freddy Villalobos
  7. The Lottery Uprising: The Albanian Government
  8. The Scientologist Snake: Reed Slatkin
  9. The Haiti Haters: various Haitians
  10. The Fraudulent Feminist: Sarah Howe

Bankling also has some interesting lists of Personal Finance Blogs that are worth a gander.

Financial Ramblings: 150+ Personal Finance Blogs: the Bankling list

WiseBread: Top 100+ Personal Finance Blogs – Sorted by Alexa Rank

Top personal finance blogs ranked by traffic (Alexa) updated daily.

the Dk report: Top 30 Financial Blogs

30 popular financial blogs from the Alexa universe excluding the huge financial behemoths.

PopTopRanks: Personal Finance

A directory of top sites listed by number of feed subscribers together with the sites’ most recent headlines.

reportonbusiness.com: Best of the Blogs

Five favourite investment blogs from the Globe.

Whether you are looking for Personal Finance items or more specifically Ponzi scheme information, you should certainly find it somewhere here.

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Personal Finance Software For Seniors

To help handle personal finances in the best way during a tough recession like this, many people turn to Personal Finance software. As a result, there is a plethora of personal finance software programs to consider. The right choice is always a very personal matter given particular needs. However everyone wants a good user experience. In other words it should be a pleasure to use and it should do the job.

If you have this software choice dilemma, you may find the reviews at Personal Finance Software a good place to start your exploration.

Of course everyone and particularly seniors is looking for something that is easy to use and install. So we list below the Top Ten choices in descending order of attractiveness. In each case, the comments on Ease of Use and Installation from the review site are displayed. By clicking on the link, you can see the full review, which clearly you should do before homing in on the choice that works for you.

Personal Finance Software – Top Ten Reviews

with Ease of Use/Install Comments

    Quicken Starter Edition – Gold Award
    Quicken Starter Edition was easy to install, and easy to use. It’s not packed with a bunch of clutter, so finding what you need and figuring out how to use features is a snap.
    Microsoft Money Essentials – Silver Award
    Microsoft Money was easy to install, and very easy to use. We found it had a little more of a polished interface compared to Quicken Starter Edition and Moneydance. The update process was simple, and Money’s home page provides a great at-a-glance summary of your finances.
    Moneydance – Bronze Award
    The main page of Moneydance is visually simple, which is one of its strengths. The navigation bar and buttons can get you to any section, and the main content area neatly summarizes your accounts, even displaying bill reminders and a tidy calendar. Adding new accounts is a snap as well, and Moneydance 2009 connects to a large number of banks and credit unions the world over.
    AceMoney
    AceMoney was easy to install, and even easier to use. It’s not difficult to figure out what you need to do to access your portfolio, schedule bills and deposits, or run reports, to name a few. AceMoney also supports importing data in a large number of formats, including qif, ofx, ofc, qfx, and xml, so even if AceMoney can’t automatically update your account information, it can read files your bank exports.
    BankTree Personal
    BankTree was easy to install, and easy to use, with large navigation buttons at the top that make it apparent where to go to look at accounts, reports, etc.
    RichOrPoor
    We were disappointed RichOrPoor doesn’t have a setup wizard to guide you through the setup process. RichOrPoor doesn’t import any of the standard formats that most banks use, such as qif or csv. You have to locate where the information goes and then type it in. This becomes tiresome, considering some personal finance software packages connect directly to your bank accounts, and most import a standard set of file types. If by chance your bank exports your accounts to a .rop file, your data entry would be diminished significantly. Once you have entered all of your information, accounts, balances, transactions, and so on, the program is fairly easy to navigate. It’s getting there that’s a chore.
    Budget Express
    Budget Express is a software program that focuses primarily on budgeting and does a good job—this combined with its functionality make Budget Express one of the top ten money management products. If Budget express wanted to compete with some of the all inclusive financial software packages, they would have to add financial planning and investing features.
    Account Xpress
    Accounts Xpress doesn’t offer a setup wizard to help you initially input your financial information. This is a real downfall for people who are not familiar with finance software.
    iCash
    iCash has the ability to reconcile your accounts with your
    bank statements and form a budget for everything in your books. We only found five different reports available within this product: balance sheet, profit and loss statement, profit and loss summary, account statement and taxes.
    Home Bookkeeping
    A user-friendly toolbar, that allows you to quickly access all your accounts, expenses, income, planning and debt, makes Home Bookkeeping a good program for the computer novice. The program was easy to install and we didn’t encounter any errors during installation.

Given the importance of the software working for you, if you have either good or poor experiences of any of these personal finance software programs, why not add a comment here. You then will be helping others to make a better choice.

Footnote: If you are interested in books on Personal Finance, then why not visit the Personal Finances Bookstore.

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Reverse Mortgages

Minnesota AG, lawmakers are targeting reverse mortgages.

Minnesota Attorney General Lori Swanson and DFL lawmakers are introducing legislation they say will protect senior citizens from aggressive lenders pushing reverse mortgages on their homes.

Reverse mortgages are certainly something that should not be considered lightly.  Pam MacKenzie used to be for them but now questions them.  She points out some of the pitfalls.

A  reverse mortgage is available to senior citizens,  62 years old or older, and the bank lends the senior money against the equity in their home. The loan doesn’t have to be repaid until the seniors move out. If they die before moving out, the heirs pay off the mortgage out of the estate.

My advice is to research your options very carefully before you take out a reverse mortgage. It’s okay to spend your heirs’ inheritance, but it’s not okay to waste your equity and net worth on frivolous spending. If people in your family tend to live a long time, don’t start borrowing money on a reverse mortgage when you hit 62. Your equity will be long gone when you hit your 80s and 90s and need that equity to pay for long-term care.

Her wise advice is to consult someone who understands money and have that person review your options with you before you sign on the dotted line.  Since some seniors have lost their homes through foreclosure on reverse mortgages, it is not something to enter into without a great deal of thought.

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What Age Will You Retire At?

Choosing when to retire is one of the most important decisions any senior must take.  Many weighty issues are involved and much has been written on the subject.  Here are a few of the more important articles on the age of retirement that you will find on the Web:

The last one is thrown in somewhat facetiously.  A more useful reference is that provided by today’s CNN article on Kicking Back In Retirement.  This is the final excerpt in the five-part series by the CNN chief business correspondent Ali Velshi. It is taken from his new book,”Gimme My Money Back: Your Guide to Beating the Financial Crisis

For too many people, retirement recedes like a horizon. As you draw closer, it moves farther away. You reach the age that should have been the starting line, but the comfortable years they talked about on TV are nowhere to be found. What happened?  There’s no mystery. The retirement we’ll have is a function of how well we’ve planned for it. If you leave it to chance, you might as well forget about it. So it’s time to start thinking about it now.

His key pointers are:

  1. Save as much as you can as early as you can.
  2. Set realistic goals.
  3. Tax advantaged accounts represent an excellent way to save for retirement.

As with the previous excerpts, it is a excellent advice.  For the other seven of his key pointers, you must refer to his book.

Footnote: If you are interested in books on Retirement, then why not visit the Retirement section of the Money Bookstore.

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