Divorcing Money From Emotions: A Guest Post

Money is a hot button in many relationships, including the relationship between our inner self and our public image. But how can we divorce money from emotions? That question is answered in this guest post from Women & Co

"Learn How to Develop A Better Relationship With Your Finances

Many of us may consider our relationship with our money a “love-hate” one – but it doesn’t have to be that way. Just like any other relationship in your life, in order for it to be a success, your relationship with money requires a good attitude, consistent communication and an ongoing commitment. Lisa Caputo, Founder and Chief Executive Officer, and Linda Descano, CFA, President and Chief Operating Officer of Women & Co., offer these tips to help you separate your money and emotions, and forge a healthier way to relate to your finances.

First: Assess how you feel about money. Begin by asking yourself these questions that may determine the psychological factors driving your financial behavior:

· Is money a sign of power or control in your relationships?
· Do you regularly put off budgeting? Saving? Investing?
· Do you use money to boost your self-esteem?
· Does the “rush” of making a purchase drive your spending?
· When growing up, did the subject of money or budgeting start arguments?

If you answered “yes” to any of these questions, it may be time to re-evaluate your attitude toward money and budgeting. A healthy attitude is one that enables you to indulge now and then, but also helps you prepare for unanticipated expenses that inevitably arise. Here are some key ways to get on a healthier track with your personal finances and stay in control of the relationship:

· Commit to Your Budget: Commitment is a key element when it comes to successful budgeting. Be realistic about your spending habits, and set a realistic spending limit for yourself. Monitor your budget and spending habits closely and regularly, and be prepared to change your budget to adjust to any lifestyle changes that may occur, whether these changes are for the better or worse.

· COMMUNICATE: It is critical that you discuss your financial situation with your spouse/partner, financial advisor, and most importantly, yourself. Share any feelings or experiences that may shape your attitude towards financial activity. Communicating your financial flaws and past mistakes will help you determine what will be the most effective way for you to save, spend and budget from this moment on.

· Be INVOLVED: It is important that you are involved in your finances, and if you have a spouse/partner, you both should be on the same page with creating and maintaining a financial game plan. Being involved not only means you have a plan, but that you’re also checking in with yourself and each other to monitor how it’s going, and making any adjustments along the way, as needed. Remember, knowledge is power, and by knowing all the financial facts of your life, you will have a much better sense of control.

· HONESTY is the Best Policy: Be honest and realistic about your goals, as well as the sacrifices you’ll need to make in order to meet them. Maintaining a budget and financial plan will be extremely difficult if there’s any denial or disagreement with your loved one about money. It is possible that what you consider a “want,” your other half considers a “need.” Be honest about what you want, need and expect from your budget, and understand what meeting those wants, needs and expectations will require from you."
--source: womenandco.com
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6 Financial Makeover Tips: Ideas for Making Sacrifices

These frugal living tips from Citibank actually make sense. My favorite is #6 (Creating Financial Sacrifices.)

"Personal finance author, director of Citi’s Office of Financial Education and money makeover expert, DARA DUGUAY offers these “Commonsense Considerations”* to begin tackling today’s financial emergencies:

1. Get a picture of your finances. The only way to do this is by creating a budget to see what money comes in and what money goes out.

2. Determine your monthly “fixed” and “variable” expenses. Now that you have a budget, it’ll be easier to see where you can save. When looking for ways to cut your expenses, start with your variable expenses first. You have more control over your grocery bill, your clothing allowance than over your mortgage, rent or car payment. But don’t overlook opportunities to lower your fixed expenses either. Minor reductions in everyday expenditures can make a big difference.

3. Don’t let your financial state send you into ‘Panic Mode.’ Stay calm and focused. An anxious state doesn’t help you plan or act rationally, especially during an emergency.

4. Pay down high-interest debt. You are much better off concentrating the majority of your money on paying down debt first, while still adding a lesser amount toward your savings.

5. Set up an “Emergency Fund.” Be realistic about what constitutes an “emergency.” Emergency savings will provide you with a safety net so that an unexpected life curveball won’t catapult you into a financial crisis. Look at it as a form of insurance. Evaluate what a true emergency is, i.e. having a car that won’t start is probably an emergency, but having a car that’s not this year’s model is not.

6. Make a “savings sacrifice.” Forgo the full-service car wash or play on the public tennis courts instead of joining a racquet club. When it comes to saving money, every little bit counts. These little savings can add up over the course of a month. For example:

SAVINGS SACRIFICE AVG SAVINGS PER MONTH

Dining in vs. Dining out
$300

Jogging outdoors vs. Gym
$60

Public Tennis Courts vs. Racquet Club
$70

Machine Washable vs. Dry Clean
$50

Packed Lunch vs. Buying Lunch
$200

Public Transit vs. Cab/Parking Fees/Gas
$300

TOTAL SAVINGS
$ 980

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$75,000 Robot & Top 10 Expensive Gifts w/Photos & Frugal Tips

One expert on self-made millionaires has issued his own list (with eye-popping photos) of the most extravagant holiday gifts and his advice: Forget the hype & shop within a real budget. It's a fun list with great visuals. (see below) I have one question: Who buys this stuff???

Here's the guest post with photos, prices and tips (after the photos):

"Americans are expected to dish out a staggering $474.5 billion this year on Christmas shopping, according to the National Retail Federation (NRF). Jim Trippon, CPA and one of America’s foremost authorities on the money habits of self-made millionaires, has released his annual list of the most expensive gifts to give your loved ones this holiday season.

“Here is Trippon’s annual top 10 list of the most expensive holiday gifts for 2007:

1. Bugatti Veyron - $1.7 million

2. Neil Lane 15 Carat Diamond Earrings - $750,000

3. Runco 103-Inch Plasma Display- $99,995

4. Swami Conversational Robot - $75,000

5. Tiffany &Co. 109.73 Kunzite Bow Brooch - $74,500




6. Vertu 7.2 Carat Pink and White Diamond Phone - $73,000

7. Fendi Selleria Bag - $38,000

8. 1-Degree North Pole Dogsled Expedition - $37,500


9. Serendipity Frrrozen Haute Chocolate - $25,000

10. Friends of Cashmere Classic Pet Bed - $399

Trippon's Advice:

"Each year it seems that American’s top themselves in spending for Christmas,” says Trippon, “If you can afford the best without going into debt, that’s great! But I think most people forget that this holiday is about being in the right spirit, not getting overloaded with debt, which often produces money arguments the rest of the year.”

The NRF said that Americans plan to spend an average of $923.36 in total this year, up 3.7 percent from the previous year’s statistics. Given the credit card rates that are often at 24 percent and assuming minimum payments, Trippon says that this year’s holiday shopping will cost the average consumer closer to $6458.87 when interest and finance charges are included.

Trippon believes that people avoid arguing about finances when they take the time to become educated about money together.

“Get real and deal with your budget,” says Trippon, “Be honest with each other about your money habits and come up with a plan to spend it as a couple. It will improve your love life!”

Trippon is the author of the Amazon best-seller, How Millionaires Stay Rich Forever: Retirement planning Secrets of Millionaires and How They Can Work For You and the upcoming title China Stock Guru.

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