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by Miata on November 22nd, 2011
Miata,
I know I shouldn’t tell you this, but I really don’t have time to sit down and write out a  complete budget! I know, I know, it’s horrible. Could you give me some quick tips to keep track of money without writing it out?
You probably know how I’m going to respond… The bad news is that until you take the time to write out your expenses, it’ll be impossible to make real, effective changes to your budget. There is a slice of good news, though. We can speed up the process of budgeting to make it easy until you find time to attack your budget head-on.
- Use a website like Mint.com to help you budget on-the-fly. You can link Mint to your checking account so that it gives you a quick rundown of how you spent cash. The best news? Mint lets you set parameters to warn you when the checking account is worse off than you’d wish. Don’t want to use Mint or another similar site? Many banks are adding robust budget tools. Check with yours to see if this’ll make it easier to keep track of your spending.
- Communicate regularly with those who share your budget. If you’re married or setting goals with a partner, schedule time to review bills, investments and upcoming big ticket expenses. You won’t regret it. For many families, this single act allows them to effectively plan because everyone is on the same page regarding how money should be spent during the week.
It’s understandable to feel overwhelmed by the prospect of creating your budget. But I promise it really doesn’t have to take that long. Check out Artist’s Prosperity 101 for a clear and affordable program that will take you step by step through the process of getting completely financially organized. You’ll create a strong financial foundation - including a budget - in just 4 weeks of extremely manageable actions!
by Miata on November 17th, 2011
 Remember the three little pigs? Sure you do. The moral of the nursery rhyme was simple: build your house right the first time and it won’t be blown over.
In the arts, we’ve all heard this advice before. It’s the quality of our work that brings people back. We’ve watched suspiciously as performers with gimmicks shoot to the heights of fame for a few brief moments; but it’s only quality work that helps ensure a long, prosperous career.
Or in other words, using three little pigs speak: If you’re building your house, make it brick.
I’ve often heard financial planning referred to by professionals as a house. A foundation laid on the sandy ground of debt and scattered income is bound to fall later. For the average person, building consistent, dependable income and paying down debt are jobs number one and two.
But we aren’t average, are we? Read the rest of this entry »
by Miata on November 10th, 2011
 So you’ve finally checked your bank statement to discover that you’re getting nearly no interest from your savings account. Should you check out online bank accounts or are those risky?
Internet banking isn’t for everyone. I could never tell my mother to open an online account because she wouldn’t know how to withdraw funds and would worry that she couldn’t run down to the corner to take it out. That said, usually your best interest rates are going to be found with large, reliable banks online.
There are two considerations –
- Are you internet savvy and comfortable saving online? If so, explore away! Websites such as www.bankrate.com will help you compare interest rates when deciding where to invest. You should also check out bankrate’s list of star rankings when determining which firm to trust with your money. All banks aren’t created equal.
If you aren’t internet savvy, it’s better to stay close to home. Check to see if you’re eligible for a credit union. You may be surprised to find very competitive interest rates, which are often better than those at the bank.
- How quickly can you remove the funds? Remember that a savings account pays a low interest rate because it offers quick liquidity. If you’re saving online but don’t have an easy method to access funds, you may defeat the purpose.
You may also want to check other account types at your bank. Often, banks offer higher interest money market accounts with higher rates as long as you promise not to touch them often.
by Miata on November 3rd, 2011
 Honing a craft is a solitary activity. Excellence means many hours out of the spotlight, so that once you’re finally ready for prime-time, all of the finer points of the work are complete. To your audience it’s effortless; you’re a pro.
Unfortunately, this “solitary confinement” approach to excellence often clashes with successful money management. The government and business community are constantly revising rules that affect your ability to manage your money.
That’s precisely what happened late last month. A new credit card law went into place that has the potential to have a devastating effect on some artists. I thought I’d give you my take on the rules and some ideas of how to respond, so that you aren’t surprised the next time you apply for credit.
Here’s the part of the ruling which could derail your planning: you can no longer use spousal or overall household income to apply for credit.
What does this mean for artists? If you’re working full-time (or near full-time) on your craft, your income may not yet be where you’d like it to be. First, you may be spending money that counts against your income, lowering the amount you can claim. Or, you may be still building skills to make money later. In either case, you may now find it difficult to secure credit in your name. Read the rest of this entry »
by Miata on November 1st, 2011
Being a financial coach and a parent means that I frequently get asked questions about children and money. Many of us struggle as adults because we never learned how to really manage our finances. We wonder how we can avoid making the same mistakes with our own sons and daughters.
Introducing an allowance can play a role in helping children learn to save. But how much should we give them? Should the allowance be tied to chores? These are just a couple of the questions that arise.
Allowances are very personal, and many experts have conflicting opinions. As long as you remember that these are only opinions, here are mine: Read the rest of this entry »
by Miata on October 27th, 2011
 I want to sell my house. With all of the foreclosures, is this actually a good time to be in the real estate market?
-Sherry
This is a tough question Sherry. Sadly, there isn’t a great answer. If someone absolutely loves your home, they may overpay, even in this economy. Wouldn’t that be great?
I will give you three points to consider when deciding whether to sell in this market:
- Are you upgrading to a larger/more expensive home or downsizing? Here’s why this is an important factor to consider: there is a good chance that if your home has slipped in value, so has the home you’re about to purchase. If the properties are in similar markets, you’ll lose some money on your current home but will then save a bundle of money on the new property. If you’re about to spend more money by upgrading, this works in your favor. When downsizing, you’ll lose more on your current home than you will on the one you purchase.
- Why are you moving? Interest rates are low. If you’re moving because you can’t afford the house payment, will a simple refinance work? Would there be ways to take advantage of the interest rate climate that involve less upheaval?
- My friends who are real estate pros tell me that there is no single “housing market.” There are thousands of little markets. How do your current and prospective markets compare? If your market is depressed but the area you’re moving toward is still booming, maybe this isn’t a great time to sell. If the area you’re moving to is depressed, but yours is holding up well, you may find a steal.
Selling a home is a difficult decision because real estate is usually the most expensive item on a person’s net worth statement. Take your time to make a good decision you’ll be happy with—because you’ll literally live in it!
by Miata on October 24th, 2011
 Last night I attended a benefit with a group of fabulous women. In a conversation before the show started, one of my companions mentioned that she was thinking about opening a brokerage account. She asked the very common question: Should she use a broker or do it herself?
I tend to lean toward the “do-it-yourself” route, but not everyone is the same. It can be reassuring to have a professional help you make important investment decisions and guide you on the steps to manage money. That said, remember that you’re going to pay for this service. If your goal is to get ahead, a full-service broker or advisor is going to slow that process with their fees.
Here’s what you need to ask if you go the full-service route:
- What are the fees associated with your service? Make sure all fees are in writing and that you understand how and when you’ll be paying.
- What is your investment philosophy? You want to make sure that your broker is on the same page you are. Generally (though not always) someone around your age will probably identify with your goals more than someone much older or younger.
- How experienced are you? Sitting in a chair for a long time doesn’t make someone an expert. That said, I don’t necessarily want to be the “test run” for the new broker.
The Financial Industry Regulatory Authority (FINRA) provides a website to make sure your prospective broker has never been in trouble. You’ll find it here.
If you decide to fly solo, you’ll also need a few tips:
- Are you a self-starter? Starting an online brokerage account is more than about avoiding fees. I’ve met plenty of people who never trade, never invest and don’t make prudent investment decisions while they’re savings a bunch of money in fees. Remember: saving money in fees won’t reach your goal. You’re going to need to plan and keep yourself on that plan to succeed.
- Compare services. Some online brokers offer convenient methods to add and subtract funds. Others offer incredibly low trading costs. Some work with many mutual funds. Others only let you choose from a few. Call the phone support people and ask them how to open a Roth IRA (whether you need one or not). Judge the service you receive. Was it helpful? Were you transferred several times?
We’ll do a full blog piece on this in the future, but hopefully this will help anyone out there considering this very question to get started!
by Miata on October 20th, 2011
 “The harder I work the luckier I get.” – Samuel Goldwyn
They say that success is often just a matter of being at the right place at the right time. While I agree that having the casting director of the next great major motion picture as your second-cousin never hurts, I’ve always believed there’s more to success than luck. You have to work hard to put yourself in the right place, and then jump on any lucky opportunity your hard work produces.
Something else can derail your success: “Clusters of Misery”
Often, success means avoiding groups of people I call “clusters of misery.” You know the type. They complain about how the world owes them something but they never paid for it. They’re often more interested in tearing down everyone else’s success than building themselves up. They seem obsessed with all the reasons that success is going to pass them by.
This is also true with your money. Read the rest of this entry »
by Miata on October 17th, 2011
 The IRS just sent me a notice that I still owe money on my taxes. I realized that I forgot to file all of my data on my tax return. What do I do?
- Lana
Lana - This is a great question for your accountant, if you have one. The basics are easy: the IRS has a form called 1040X, which is used specifically for situations like yours. The form is simple, but read the attached instructions. You’ll need to fill out only a portion of the form, depending on the particular mistake you’d made on the original. Include supporting documents along with your 1040X to make sure you keep the IRS happy.
by Miata on October 6th, 2011
 Ah, October. I love campy Halloween movies and haunted houses. To kick off the season, we watched the Ghost Hunter television show last week. You know the one. A team of investigators spend the night at a house where unexplained phenomena has occurred. They spend the episode trying to debunk the owner’s claims of paranormal activity. Sometimes these shows are frightening.
In this episode, both a baby carriage and a door moved on their own. Unexplained running sounds crossed the floor. In one video, there’s a definite shadow of something walking but there’s no actual person.
I wanted to sleep with the lights on that night.
Maybe I shouldn’t tell you this, but there are money horror stories, too. Gruesome tales that curdle a financial planner’s blood and make accountants shriek in horror. I know, scary stuff. Here’s the most frightening money horror tale of all:
Money in your hands.
Scary, huh? You shaking? Maybe you aren’t, but you should be. Ever see the movies where the villain suddenly reaches out of the shadows and grabs the girl? In real life, the horror happens when your hand grabs a dollar bill. Why does this so frighten financial pros? That’s easy. It’s because we know that once you clutch a dollar bill in your hand, there’s a good chance it ain’t gettin’ out alive.
In short, your hand is the most horrifying spot money could possibly be. Read the rest of this entry »
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