The 5 Stages of Wealth – Part 1

15 Jul, 2011 by Kim Luu
Philosophy

Ignore what all the gurus tell you about wealth equating to being a millionaire.   The key to becoming wealthy is to readjust your mental attitude and personal behaviors to match what your needs are.   For most people, understanding your needs is the first step towards wealth.

The reason why so many immigrants become successful is because they understand this at a deep, unconscious level.  It is why a homeless waif can save more money than an executive.

Fundamentally, whether you’re poor or a billionaire, we all want and need the same things.   Dr. Abraham Maslow introduced a theory about human needs in 1943.   The basis of Maslow’s motivation theory is that human beings are motivated by unsatisfied needs, and that certain lower factors need to be satisfied before higher needs can be satisfied.

According to Maslow, there are general types of needs (physiological, survival, safety, love, and esteem) that must be satisfied before a person can act unselfishly.   He called these needs “deficiency needs.”  As long as we are motivated to satisfy these cravings, we are moving towards growth, toward self-actualization.  Satisfying needs is healthy, while preventing gratification makes us sick or act evilly.

This is why I strongly recommend that you set a standard of luxury that truly means luxury to you.   To stay on a focused path towards wealth, you need to channel your need for indulgence and luxury into something that is truly fulfilling and luxurious.

Here is Dr. Maslow’s levels of needs broken out.

 

Maslow's Hierarchy of Needs

 

Next, I’ll share what the fundamental needs are that affect our ability to build wealth.

© 2010 MoneyandRisk.com all rights reserved

photo credit: Lutz R Frank

Having Choices As A Senior – Working Forever

12 Jul, 2011 by Kim Luu
Opinions

What will be the most valuable thing to a senior? I suspect that the answer is having choices or freedom.   It’s impossible to calculate how important or valuable such a small thing could be until it is taken away from you.

We’re incredibly fortunate to live in the United States where our freedom is protected for the most part.

However, choices are taken away from us every day by well meaning people.   They range from our politicians, our neighbors to our own family.  I found recently that I was guilty of depriving my mother of her choices.

Many kind readers of Money and Risk had sent me emails earlier in the year, asking about me when I stopped posting for a while.    In response, I shared the choice to focus on my family versus writing blog posts.

My mother came down with pneumonia twice during the holidays and almost died due to a mysterious infection that she picked up in the hospital.   She went on life support and after almost two months of no food, her health was never the same.

As a wheelchair bound senior, she still does not accept her physical limitations.   It is hard for her to go from jumping ropes daily to using a wheelchair or walker with helpers.   We catch her trying to do normal chores all the time and arguments would ensued.   Out of love and worry, we restrict her movements and activities.

I never thought much about our reactions until I read a lovely short story by Nancy Fulda on the Baen Free Library site.

It’s called That Undiscovered Country and it made me think.   The story is about a group of seniors who fought being put out to pasture.   I won’t ruin the story with spoilers but here are some of the issues that the story brought up.

 

*   What if you’re still enjoying life and want to continue challenging yourself?  Would our society allow you to?

*    What pains do we inflict and damages to relationships do we cause in the name of love?

*    Do we have the right to choose for someone else as to how they live?

For myself, I have always believed in working until the day I say goodbye to life.   The key for me is having a choice. I can’t imagine sitting around doing petit point or watch TV for 50 years in retirement.

Retirement is about having the choice to work at what I want, when I want, and at what I enjoy. If I choose to take six months off to hike in Alaska, I will have the freedom to do so.  If I choose to come in to work every day and am doing a capable job, it’s my right to do so as long as someone is willing to pay for my expertise.

I would be quite upset if I was told that I’m not allowed to work or hike in the wilderness because of what someone think I’m capable of versus what I can actually do.

Unfortunately, this loss of choice is something that many people are already facing especially with the current rate of unemployment.   Many professionals over 50 have already been forced into early retirement.   How difficult it would be to lose the few options you have left because your family cared too much.

I work hard at providing seniors with choices and options for their retirement yet I did not think about my own mother’s situation.  Love can make you quite blind.

Nancy’s story changed how I take care of my mother.  I don’t keep her from doing things anymore but I make sure that she has all the support and tools she needs to do it without harm.    Will I have tremendous guilt and self anger if she hurt herself?  Absolutely, but I don’t have the right to stop her from fighting to regain her mobility.

READERS:  Are you a caregiver too?   What do you think about our dilemma?

© 2010 MoneyandRisk.com all rights reserved

photo credit: NASA Space Center

Nancy Fulda won the 2011 Jim Baen Memorial contest for That Undiscovered Country.  The contest is a joint venture between Baen Books and the National Space Society for best short story about man’s future in space.   Jim Baen was a marvelous individual and editor who supported reading and exploration about our future.

You can buy other short stories by Nancy such as Dead Men Don’t Cry.    She is currently living in Germany working as an entrepreneur while taking care of three children.

“Nancy, thank you for making me think.  Kim”

Will You Have Time For Your Family? Making Life’s Choices

15 Oct, 2010 by Kim Luu
Philosophy

This blog came into existence after I spent time this January in a hospital holding vigil for my dad.   I’ve been struggling for the past three weeks to find the words to talk about how important it is to simplify your financial life and your work life so that you can focus on the important things:  living life with the people you love.   I am now writing this post as I sit in another hospital room watching over my mom and praying that she will recover from pneumonia.

I’ve been simplifying parts of my life so that new projects I take on such as this blog would not eat up time that is meant to be spent with my family.   I find that over the years, my needs have been stripped down to the essentials.   Nothing else is that important.   It’s just stuff that I accumulated.

The important items have been reduced to a few things, among them is the bracelet that my grandmother and I picked out together when I was ten years old. Most everything else is replaceable or unneeded.

What was truly important to me was to not have regrets. I and several other members of my family have been given a second chance at life.   We know what it’s like to run out of time. I’ve been making changes to take advantage of my second chance but I still have a long way til I reach my goal.

I’m reminded today that time is not in my control.  I need to live life every day as though it is my last chance. I’m not talking about things like the bucket list.

Frankly, if I’m on my deathbed, my regrets would not be about climbing Mt. Everest but about whether the people in my life knew every day how much I loved them.  The priorities may be different for someone else.

What will you regret?

This is the list of daily activities that I strive for but fall short in executing perfectly.

  1. Tell everyone I care for that I love them. Tomorrow may never come.
  2. Forgive and let go of anger before I sleep. Arguments can be discussed again the next day.   (This is a tough one sometimes.  I do hold grudges overnight even though I shouldn’t.)
  3. Say thank you for every act of kindness or courtesy.
  4. Tell the people in my life how much I appreciate them and why at least once a week.  This helps me not take anyone for granted.
  5. Have an experience with someone I love each day so that the days would not blur into a haze but would be distinct as memories.

It takes time and practice for me to make these actions into an ongoing habit but it’s not something I want to do by rote.  I want to do them with awareness so that they help me connect with the real me.  I want the actions to be from the heart and with thought and love.

I will never be perfect and I will never do my best because one can always do better.   However, I will try every day as best I can for that moment.

What I have come to accept is I will always have regrets about things not done.  I will always fail because life is unpredictable but it will not stop me from making the effort to live consciously every day and show my love.

Life is busy and chaotic.  We all get sucked into the daily routines and make excuses for things we know we should do while do we things that are not so important in the long run.

I like to ask myself  one question, “if I’m out of time, is this something I will regret not doing?”  This helped me set my priorities.

Don’t make my mistake and take life for granted.    You may not get a second chance.

© 2010 MoneyandRisk.com all rights reserved

photo credit: Michelle Mitchell

The Internal Saboteur – We Choose Not To Succeed

29 Sep, 2010 by Kim Luu
Philosophy

No matter what self help books you read, success can only happen if you have the cooperation of one person: yourself.

It often comes down to one thing:   You don’t really want to succeed, and you inadvertently sabotage your own efforts.   Liking yourself and who you are is critical to achieving your life goals.

You may complain about corporate indifference to being taken advantage of.   You may be born into the poorest circumstances.  The excuses are wide ranging about lack of success.   Some people try very hard and spend a large amount of money to improve themselves or learn but never can pull themselves out of their rut.  This is money and time wasted until you actually look at yourself and give yourself the permission to succeed.

It doesn’t matter what it is you’re trying to do.   Until you allow yourself to do it, you won’t.

Take a look at this scenario:

Someone desperately struggling comes to you and ask for help.  They say “I really want to change my life and move to the next level but I don’t know how, could you help me?”.   Would you ever say no?  Not many people would.  In fact, everyone has access to a tremendous amount of help from government resources to private acts of kindness.   Whether or not this person would succeed is dependent on if he/she grab the helping hand and push themselves up.

What would make them let go of the helping hand?  We let go when we hate ourselves.   We just want to slip back into a pit of self pity so that negative image we have of ourselves can come true.

We carry on destructive internal dialogues that poison our viewpoints and shift our behavior towards sabotage:

  1. I don’t deserve it
  2. I’m a bad person
  3. I’m not good enough
  4. People don’t like me
  5. I can’t succeed

All those insidious whispers stem from one thing:  We dislike ourselves and we’ll punish ourselves for that dislike by sabotaging our efforts.

Even if we think we’re confident, comments like those will always occur in our heads.  I hear them all the time because I watch out for them.

We’ll make all the wrong decisions.  We’ll blindly follow other people.   We’ll look for shortcuts to avoid looking at the truth.  We’ll ignore the things we need to do.  We won’t change our lives.   We won’t live our dreams.

The first step to changing our lives into what we want is to look honestly at who is holding us back.   Is it someone else?  or is it really us?

*   Are you doing things that doesn’t make sense and you can’t explain even to yourself?

*   Are you spending money that you don’t have?

*   Do you buy things because it’s what other people are doing?

*   Are you complaining all the time but never actually do anything?

*   Do you say one thing or want to do something but act in another way?

*   Are you following the crowd?

*   Do you feel discriminated against? Is it real or in your mind?

*   Do you have a chip on your shoulder?

*   Do you hate the world?

These are signposts about our conflicting feelings.

If we’re truly honest, for most of us–including successful people–we are our own worst enemy.   Everyone has self doubts and fears.  It’s natural to go through phases like that.  The trick is not to hurt ourselves while we’re down.   We need to recognize the warning signs and work to block those natural little sabotages until we like ourselves again.

Some people may never have liked themselves for their entire lives.

The self loathing is unreasonable and not necessarily based on facts.  It’s complicated and are tangled with many emotions that I’m not sure any of us could ever figure out even if we spend years in psychotherapy.

I have spent two years knowing that I need to lose weight for my health, yet I have not taken any solid action about it.  I want to change, but I don’t.   I know that losing weight will positively affect my health, improve my financial situation, and protect my self esteem.  However, I do nothing substantial, both unconsciously and consciously, because I don’t want to.  Will I eventually take action and change?  Yes, because I do like myself and value me but it may be months or years.  I have to commit and not just to want.

What is important is recognizing that I have an issue, just like an alcoholic.   It will take time for me to work through the self punishment that I’ve chosen to inflict on myself.   I have to find the cause and root for this sabotage.   When I figure it out, I will be able to face the fears and move on.

Once we recognize the enemy, we can then move onto the next step, building the defenses by learning who we are and then to liking ourselves.

© 2010 MoneyandRisk.com all rights reserved

How Women Can Sabotage Their Financial Future

19 Sep, 2010 by Kim Luu
Philosophy

One of the most valuable advice for women about financial security would be the phrase that was made popular by President Harry S. Truman, “The buck stops here”.

Ladies, let’s be honest with ourselves; unless you plan on marrying rich, we’re ultimately responsible for taking care of ourselves financially throughout our lives and at retirement.   Even then, that large nest egg could still be squandered.  A spouse might be a help or a hindrance depending on each person’s unique situation.

Right now, women are much more likely to live in poverty after retirement than men according to one of the latest government report by the United State GAO (Government Accountability Office).

To truly become financial independent and achieve wealth, the attitudes and assumptions that one takes for granted or lives by need to be challenged.

1) Define saving money via shopping. Many women focus solely on saving money while shopping as their main method of planning.

If you break down the reality, saving money isn’t the focus.   Using less money to buy certain items so that you have money to buy more items is the true focus.

One woman in a frugality forum asked for help because she had already filled her entire house with food stockpile and ‘necessities’ and needed to figure out rental storage space so she can buy more.   No one saw anything wrong with this.  In fact, another woman recommended a frugal blogger who used her oven as storage.   Another suggestion was to clean out the food near expiration and donate them so that she can buy more food to stockpile.

2)   Not looking to the future. When I’m talking about the future, I am talking about 10-20-30 years out.   Very few women plan for this until they’re out of time and resources.

Many focus on their children as their life’s goal and never think beyond.  What happens after your children are grown and out of school?   What do you want to do?

One woman told me recently that her children are her future and her retirement.   Her exact quote, “my kids are the best investments that I could ever make of time and money.  This is my retirement .”    I beg to differ.

I am a huge believer in investing in children but as your retirement income?  No way.   Do you know many boomers and seniors out there who are being supported by their children in retirement?   I’m seeing the opposite.  Seniors and boomers are forced to slave away and support their adult children.   Statistics worldwide are supporting this trend.

3)  Finance only means paying bills. Finance is more than that.  Planning for emergency is more critical for middle class families because we don’t have the resources to ride out unexpected costs.

The impetus for this post came because I just received word that a young woman (26 years old) I know just died of cancer and left behind three children.   She came into the hospital two months ago for a headache and got diagnosed for a treatable tumor.   Her cancer went from treatable to terminal in two weeks.   She and her husband had absolutely no plan in place for their family.   Aside from the emotional devastation of losing his wife, her husband will now have the extra costs of finding a full time caretaker for their children.   This will place a large financial burden on the family.

4)  Depending on others for financial support. This habit starts at a young age.   Are you unconsciously depending on Prince Charming?

I talked to a group of young men in their 20s and 30s recently.  When asked to breakdown their expenses, aside from sports, one of their biggest expenses were the girlfriends.   It ranged from presents, trips, vacations, to actual allowances.   It was shocking to hear that 20% gave over $1,000/month in cash to their girlfriends.

I thought my brothers were the only ones who had dependent girlfriends but they weren’t alone and may even be the norm.   One brother had to buy a new car for his girlfriend while he drove a seven year old car that just broke down.   His girlfriend had a perfectly fine job making as much as he does but she spends all her money on clothes and shoes.

5)   Depending on marriage for financial security. Marrying for love is a modern concept.  Traditionally women have married in the past for security.

We have the financial ability now to make our own future.   Do you unconsciously assume that life will be less financial stressful with a marriage?

What is the #1 dream for many young women and girls?  A beautiful wedding. Ask any young woman and I bet you that she had planned the details of her wedding since elementary school or high school.  Very few look beyond the wedding day.

When one of my brothers turned 18 and graduated from high school, he got engaged to be married.   He had been working at a part  time job to buy the engagement ring.   I asked his girlfriend what their plans were after the wedding.   Her assumption was that they would move in with me.   I raised my brother and he was living with me.   She didn’t have any plans to ever get a job.  That was her husband’s job to support her.

The engagement broke up shortly after I pointed out that I expected my brother to move out after the marriage and that they need to live on his limited income.  She ended up marrying someone else with more money a few months later.  Did she have a happily ever after?  I don’t know.

Roles are reversing, ladies.   Many women now out earned their husbands and are actually the primary bread winner.   If you are, you need to take charge of your financial situation.

6)   Lack of commitment and persistence. If financial independence is truly your goal, then make it a priority.

Think of the conversations that you have with friends.  Outside children and family, discussions are about things you wear or buy.  Interactions are geared around shopping.   Emotional satisfactions are linked to things such as food, clothes, friends’ envy, and looking good.  Hopes and dreams are rarely discussed.

If you’re really serious about building wealth to live your dreams, you need to be more than interested.   You need to be committed and actually give time and priority to doing financial planning.  I’ve seen people devoted themselves to craft projects for years yet barely have time to look at their finances.   Are you spending more time on planning your quilt design than on what you need to do to build a $250,000 nest egg to start?

Everyone in the United States has the resource and capability to become a millionaire.   Whether you become one or not is dependent whether you take the responsibility for your life and take action.

© 2010 MoneyandRisk.com all rights reserved

photo credit: David Clow

When Parents’ Retirement Savings Are Hijacked By Adult Children

16 Sep, 2010 by Kim Luu
Estate Planning

In the last few years, I’ve seen a frightening phenomenon occur more frequently; the destruction of people’s retirement savings by their adult children.  It’s a devastating issue to deal with, yet it’s treated as a joke by the media.  I seen personal finance sites recommend the bank of Mom and Dad as a resource for 20s and 30s years old, without regards to the consequences for the parents.

Here are a several real-life examples of the financial devastation this burden can put on seniors and those nearing retirement.

JESSICA

Earlier this year, a 67 year old woman, Jessica, sneaked me aside for a private consult away from her husband.  Her husband recently got ill and was laid off.  He’s almost 70.  She’s working hard to support their family and is terrified about losing her job.  As a result, her health is deteriorating as well.   Their issue was that they’re supporting a family of 9 people.  Jessica has a son and daughter, both adults, each with a family of their own.  Both of these families are now living with Jessica and her husband.

Her son lost his job recently and he moved home to his parents with his wife to save money.   Her daughter is a stay at home mom (SAHM) with three kids and moved in with them when her son-in-law lost his job.  The irony is that her daughter also moved home in the last recession and never moved out after times got better. Her daughter and son-in-law has been living with Jessica and her husband for ten years.  The grandkids are going to private school and Jessica’s children are going on vacation twice a year.

In contrast, Jessica and her husband have not had any time off and their retirement savings have been depleted almost to nothing by supporting their children.  Jessica wants to kick her children out but her husband is afraid that they will not be allowed to see their grandchildren.   Jessica cried in my arms because she does not know what to do.   They’re being held hostage by love.

ELAINE

Elaine is 57 and only has $125,000 in retirement savings.   She makes $300,000 a year and lives in the same house that she bought 20 years ago.   Elaine got married at 18, but then ended up being a single mom for most of her adult life.  She worked hard to take care of her kids, but in the early years they were extremely poor.  She felt guilt over her inability to give her children the “good” things when they were young.

So far, Elaine has tapped her savings to provide a down payment for her son and bought a house for her daughter after the daughter filed bankruptcy.  It was either that or see her three grandchildren become homeless.   Between taxes and providing for a family of six, she also has to pay out for medical care due to frequent family illnesses.

Elaine’s stepson, his wife, and baby son recently moved in with Elaine and her family in their two bedroom house after he lost his job.   With unemployment and welfare, her stepson so far has taken two vacations in six months and left the baby for her to take care of.    Her husband is disabled so Elaine’s job is the only thing that stands between the family and total financial devastation.   She also cried at our meeting because she is so exhausted at juggling all the financial demands and terrified of what the future brings.

SAM and MARIAN

From the outside, Sam and Marian seem like the perfect retirees.   They’re in their 70s.  Their house is paid off and they had saved all their lives for a comfortable retirement.   They would have been fine except for one thing.  Their son, Jack, and his wife got divorced and both decided that they needed to follow their passions and find their dreams.   This meant that their baby daughter, Anne, needed to be placed somewhere so that she does not hold back her parents’ efforts.

Five years later, Anne has been permanently adopted by Sam and Marian.  Jack, their son, is still exploring his passion to become a musician instead of a lawyer so he can’t afford Anne.   He also indicated that when he remarries, Anne may not fit in with the life he wants to build.   Sam and Marian now have the responsibility of raising another family until they’re in their 90s.

They’re concerned about whether they will even have enough money to raise Anne, especially since they are on a fixed income that has steadily declined due to low interest rates.  The principal on their large retirement account is being tapped into every year.   With the principal gone, they have no chance of recouping when the economy recovers.  The reality is that Sam and/or Marian may need to go back to work in order to afford their grandchild.

These are real people (with their names changed of course) with heartbreaking choices.  They’re not unique and their situation is becoming more the norm when I talk to people.  Each of these women live in a different state.   The unfortunate thing is that these people are too proud to tell their children the truth about their finances.  They don’t want to be thought of as failures in the eyes of society.  The adult children only see that mom and dad are willing to support them, and they take advantage of that without thinking.

As boomers approach retirement and deal with a volatile investment market that may last for several more years, these are cautionary issues.  Are your children financially stable?  If not, are you able to support their needs?  What about your grandchildren?  If your adult child becomes financially dependent on you, how will this affect YOUR FUTURE?

Dear readers, as you research and read all the recommendations out there about personal finance or personal development, keep in mind one thing.  Does following your dreams means destroying someone else’s life?    Have you seen situations like these?

© 2010 MoneyandRisk.com all rights reserved

photo credit: Maigh

Stay At Home Parents Need Retirement Savings Too

12 Sep, 2010 by Kristina Quinones
IRA

(c) Andrew Magill - used under a Creative Commons LicenseIf you’re a stay at home mom or dad, did you know that you can still be contributing to your own retirement account?

Even if you aren’t currently employed (which is debatable, really, because raising kids is a very difficult job), you and your spouse can file a joint tax return. Then as long as your spouse’s income is within the limits set by the IRS, you too are eligible to contribute to a Traditional or Roth IRA account.

Okay, so you’re technically unemployed, but you earn a little bit here and there from blogging, babysitting the neighbor’s kids, or (though who has this nowadays, I don’t know) you might just have some cash burning a hole in your pocket.  It’s not too late to start a little nest egg for yourself!

For those worried about possible tax penalties and liquidity just in case you need that money sooner than retirement, look into opening a Roth IRA if you and your spouse’s total combined income is less than $176,000. (2010 guidelines)

Helpful links:

Even if the stay at home spouse does not make any income, you can still put money into an IRA – this is considered to be a spousal IRA.  If the stay at home parent makes more than $5000, consider setting up your own retirement plan.  You can save quite a lot of taxes by transferring your income from one tax category to another.  (Kim Luu)

Photo credit: Money by Andrew Magill

It’s The Moments You Live, Not The Things You Buy

15 Aug, 2010 by Kim Luu
Philosophy

The start of an athletic competition, the intensity of battle, the repetitive motion of a task, and the brush of near death all have one thing in common. They can place you directly in the moment with all your senses fully charged.   I call it consciously living.

Conscious living is the act of choosing to live in the present and absorbing all that it has to offer.   This experience can change your life because you will no longer be captive to things for your emotional and mental satisfaction.  One can either experience this moment as a result of an external event, or it can be a choice you make.

Anyone who has ever experienced a moment of conscious living cannot mistake it for anything else.  All the colors are brighter, lines are sharply drawn around objects, smells and tastes becomes magnified and you have this feeling of peace and oneness with nature.  You feel integrated as part of the whole instead of being a separate entity.  Nothing matters except that exact moment in time.  Everything is possible and the whole world feels new.  You can think clearly and will feel intense joy.

I remember the first time I was fully in the moment.  I was fifteen years old and was wave jumping near the shores of Huntington Beach with a girlfriend when the undertow dragged us out into deep water.   My friend saved my life that day because she knew how to swim; I only knew how to float.   We had been dragged out so far that you could only see dots on the shore.   She tried to pull us in but the tow was too strong.   She finally gave up and we both accepted that no one knew we were out there.

Our world shrank down to surfing the waves and staying afloat.   I don’t know how long we were out there, but it was during this time that suddenly, everything snapped into sharp focus for me. It was as if cloud covers had been removed from the sun.  I was so immersed in the intensity of experiencing all my physical senses that the emotion overrode my fears.  It lasted until we were rescued, but then faded in the rescue aftermath.

I thought it was a near death experience until a few months later when I felt the same thing in the middle of paddling a kayak around Newport Beach Harbor. I had been paddling without thinking and just enjoying the moment when my senses became magnified again.   I entered this zone of complete integration. I felt a part of the water, the kayak, and the world.   It gave me peace and energy.  I felt like God was cradling me in his hands and sharing what the world looked like.

Ever since then, I’ve aimed to have at least one moment a day when I live consciously in the present.   I don’t achieve it every day but when I do, it is a special luxury.  Whether it happened or not, the result is that I stop and just live life with awareness.  I don’t do things on automatic.  It forces me on a daily basis to take at least one minute and appreciate all the wonderful things in my life as well as all the things that we take for granted.

I don’t recall every time I’ve experienced this conscious life experience but some of the ones I remembered are not what you think.  I’ve been a car in the middle of rush hour traffic going down the 405 Freeway and suddenly the Saddleback Mountains in the distance snapped into clear focus.  Ever since then, freeway traffic hasn’t ever bothered me again.

Sometimes, the moments are brief with only a few seconds and other times, they get stretched out so much that I lose track of time in the midst of enjoyment and continuing the actions that I was working on.  These moments have been such blessings because they help me keep a positive attitude and bring me closer to God.  I’m reminded daily of the beauty of life that we’ve been given.

When you’ve had emotional richness and satisfaction from these little things in life, spending money on mindless shopping doesn’t hold the same attraction.   It doesn’t mean that you stop being a consumer, but you do become more discerning with your purchases.  Following this philosophy has led to a decrease in my spending habits over time, and has given me the strength to plow through some of the difficult times in my life.

I believe that every one of us has experienced intense life moment such as these, the question is whether you choose to do so consciously.  All it takes is an open heart and the willingness to stop thinking about past or future, focus on the moment, and just feel.

© 2010 MoneyandRisk.com all rights reserved

photo credit: Theophilos Papadopoulos, Toni Verdú Carbó , Luis Vazquez

The Power of A Dream

13 Aug, 2010 by Monica Peace
Profiles

So often we base our future on what we’ve accomplished in our past.  We are afraid to dream of what’s possible because of past disappointments, experiences or fears.

Four years ago, and 15 years into my corporate career, I found myself at a crossroads.  I no longer enjoyed my job.   I certainly didn’t enjoy going to an office and sitting in a cubicle every day, and I didn’t enjoy living paycheck to paycheck.   I decided to start my own direct sales business with the aspiration one day replacing my 6-digit corporate salary. I dreamed of doing work that was meaningful, empowering others to do the same, designing how I spent my days, and creating more time to pursue my passion of writing.

When I announced my dream to the world, the naysayers came out of the woodwork. There were a million reasons why it couldn’t be done. While people were good intentioned, I learned that most of the time, their voices were based on their own fears.

I made a choice at that point to focus on the lifestyle I wanted and became a student to successful entrepreneurs. One of the first things I learned was that your dream needed to be clear and supported by written and measurable goals.

As a mother, one of the most frightening statistics I heard was that “you only have 18 summers with your kids”. Tick tock.

My oldest son is fourteen and in 2014, he will graduate. If you do the math, that is four summers left. My dream is to continue to build a stream of residual income, that will allow me to take a year sabbatical in Europe with my boys in 2014. I created that goal when I started my business in 2006, and four years into it, with four more to go, I am more than half way there. It is within reach!

My dream is very clear, and the goals that support it keep me focused every day on what is important. I allow them and my dream to drive my daily choices around short-term vs. long-term rewards and it is paying off.

My belief is that everyone deserves to live the life of their dreams, because we only get one after all. My encouragement to all of you is to first allow yourself to dream. Second create a very clear picture of your dream – know it, touch it, feel it, sense it. Third, believe in yourself and find the strength inside of you to pursue it. It will take courage and discipline and patience, but it is so worth it. Imagine what we can all accomplish in this lifetime when we pursue our dreams and help others do the same.

© 2010 MoneyandRisk.com all rights reserved

Shakespeare by the Sea – Priceless

9 Jul, 2010 by Kim Luu
Little Luxuries

For those who live in Southern California and who love a good Shakespearean play, there is Shakespeare by the Sea.   The plays are free and held in various locations up and down Southern California throughout the summer.  In many cases, the venues have breathtaking views.   Of course not all the locations are next to the ocean,  some are located a bit further inland.

Nonetheless, it’s a wonderful opportunity to have a picnic with your family and then watch a show.   All the events are kids friendly.   I’ve seen people bring children of all ages to the events.

This year, the featured plays are Julius Caesar and Twelfth Night.   Here are the locations and dates.

  • San Pedro: Point Fermin Park

807 Paseo del Mar, San Pedro, CA 90731
Google Maps

Thursday, Friday and Saturday at 8pm

Twelfth Night : June 10, 11, 12, 24, 26, Jul 2, Aug 14
Julius Caesar : June 17, 18, 19, 25, Jul 1, 3, Aug 13

Very Chilly – right on the ocean. Bench seating available, or set up chairs or blankets on the side.

  • La Crescenta: Two-Strike Park

5107 Rosemont Ave
Google Maps

Friday, July 9 – 7pm – Twelfth Night

  • Newport Beach: Bonita Canyon Sports Park

Bonita Canyon & Mesa View
Google Maps

Saturday, July 10 – 7pm – Julius Caesar - We will be there if anyone would like to join us.  RSVP here so we know how much grass to claim.
Sunday, July 11 – 7pm – Twelfth Night

Flat grassy area. No ocean view here but nice location.  Lots of places for kids to run around.  Blankets and low chairs are best.  Check local weather. Sometimes hot in beginning, but chilly by end.

  • Whittier: Adventure Park

10130 Gunn Ave, Whittier, CA 90605
Google Maps

Wednesday, July 14 – 7pm – Julius Caesar

  • South Pasadena: Garfield Park

1000 Park Ave., South Pasadena, CA 91030
Google Maps

Thursday, July 15 – 7pm – Twelfth Night
Thursday, August 12 – 7pm – Julius Caesar

Flat grassy area.  Blankets and low chairs are best.  Sometimes hot in beginning, but chilly by end.  Definitely not ocean view.

  • Manhattan Beach: Polliwog Park

1601 Manhattan Beach Blvd., Manhattan Beach, CA 90266 Polliwog Park, Manhattan Beach
Google Maps

Friday, July 16 – 7pm – Julius Caesar
Saturday, July 17 – 7pm – Twelfth Night

Chairs are fine – low Beach chairs are nicest for those behind you. Also chilly and tends to get a little damp. Greek Amphitheater type venue in center of park – not visible from the street. You have to park a little ways away and walk in.  Not ocean view but convenient to the ocean.  Great area to walk and explore.

  • Rancho Palos Verdes: Fred Hesse Jr. Community Park

Rancho Palos Verdes29301 Hawthorne Blvd, Rancho Palos Verdes, CA 90275

Google Maps
Sunday, July 18 – 7pm – Twelfth Night

Huge grassy field with bowl-like corner where audience can place seats – low chairs best for areas with rise. Blankets a must. Starts out warm/hot, but marine layer floats in by intermission – layers of warm clothing a must.

  • Hermosa Beach: Valley Park

Valley & Gould, Hermosa Beach, CA 90254
Google Maps

Wednesday, July 21 – 7pm – Julius Caesar
Thursday, July 22 – 7pm – Twelfth Night

Very steep hill – low beach chairs, and blankets are best. Gets a little damp and chilly. You have to park in the surrounding neighborhood and walk in.  No ocean view but less than a mile from the ocean and great community to walk around.

  • Torrance: Wilson Park Gazebo

2200 Crenshaw Blvd, Torrance, CA 90501
Google Maps

Friday, July 23 – 8pm – Julius Caesar
Saturday, July 24 – 8pm – Twelfth Night

Open grassy area by the gazebo – come early to get close.   Greek Amphitheatre.  Sloped lawn gets steeper the further you get from the playing space.  Low beach chairs or blankets work best.  Warm layered clothing recommended. Definitely no ocean view and inland.

  • Laguna Niguel: Crown Valley Community Park

29751 Crown Valley Pkwy, Laguna Niguel, CA 92677
Google Maps

Sunday, July 25 – 7pm – Twelfth Night

Steep amphitheatre bowl – all grass. Blankets and low chairs best. Gets a little chilly by the end of the show. Come early – it gets packed. Parking available in adjacent lot.

  • Glendale: Brand Park

1601 W. Mountain Street Glendale, CA 91201
Map

Wednesday, July 28 – 7pm – Julius Caesar
Thursday, August 5 – 7pm – Twelfth Night

Enter the park through the main gate on Grandview.  It will be straight in front of you (note: the main gate says “Miradero”.  Don’t let this fool you.  Miradero was the formal name that Mr. Brand called his property before he deeded it to the city). Follow the road straight through the park.  Pass the first/lower parking lot on the left.  Continue on through the park past the Brand Library at the top of the drive way (huge white mansion).  At this point keep your eyes peeled for the Dr.’s House – it’s blue.  There should be plenty of parking in both the upper and lower parking lots.

Glenoaks Park, Glendale

  • Glendale: Glenoaks Park

2531 E Glenoaks Blvd, Glendale, CA 91206
Google Maps

Thursday, July 29 – 7pm – Julius Caesar
Wednesday, August 4 – 7pm – Twelfth Night

Charming pocket park with flat grassy area nestled in between trees. Parking available on the street in the residential neighborhood. Blankets and low beach chairs are perfect.

  • Lakewood: Del Valle Park

5939 Henrilee St, Lakewood CA 90713
Google Maps

Friday, July 30 – 7pm – Twelfth Night

Flat grassy area by basketball court. Blankets and chairs a must as grass is thin in some areas. Tends to be hot at the beginning of the show, then chilly by the end – layered clothing recommended.

  • Rush Park, RossmoorRossmoor: Rush Park

3021 Blume Dr, Los Alamitos, CA 90720
Google Maps

Saturday, July 31 – 7pm – Julius Caesar
Sunday, August 1 – 7pm – Twelfth Night

Huge flat grassy area just outside the recreation building. Blankets and beach chairs work great. Layers also recommended.

  • Long Beach: Long Beach Museum of Art

2300 E. Ocean Blvd, Long Beach, CA 90812
Google Maps

Friday, August 6 - 8pm - Julius Caesar

Flat grassy area between museum and café. Blankets and low-beach chairs are perfect. Warm layered clothing recommended.

  • Beverly Hills: Roxbury Park

471 South Roxbury Drive, Beverly Hills, CA 90212
Google Maps

Saturday, August 7 – 7pm – Julius Caesar
Sunday, August 8 – 7pm – Twelfth Night

Flat grassy area just outside recreation center. Blankets and chairs recommended.

  • Anderson Park, CarsonCarson: Anderson Park

19101 Wilmington Avenue, Carson, CA.  90746
Google Maps

Wednesday, August 11 – 7pm – Twelfth Night

Large grassy area in center of park – slight rise for audience viewing. Blankets, chairs and warm layered clothing recommended.

Enjoy the opportunity to put a little luxury in your life without any cost.  Its a great way to enjoy the immortal Bard’s words and indulge in a picnic with your family and friends.   Live in the moment.

Guardianship – A Critical Protection for Your Child

19 Jun, 2010 by Kim Luu
Philosophy

As parents, you care and love for your children all your life and watch carefully to protect them from harm.  Many parents plan ahead for their child by doing things such as purchasing life insurance.   However, very few think about the next critical step of protecting their child’s future and well being, guardianship.

Death is not easily to think about but it is something that will come to all of us in time.  The tragedy is when it comes too soon and unexpectedly, leaving your child behind without the love and guidance that you can provide.   However, you can protect your child from this risk by planning out how you want your child to be care for if you are gone.   This can be simply done by leaving a list of instructions with your will or as formal as drawing up a guardianship document with detailed wishes.

It is not a complicated process but something that you can get done fairly quickly.   We have provided a fillable cheat sheet that helps you address the guardianship details in five minutes.

You can also make it a enjoyable project that helps you project out your dreams for your child.   It can be a wonderful journey of discovery about your life, relationships and desires.

Why is it important to designate a guardian for your child?

  • Love and affection.   If someone dies without any instruction, typically the law transfer guardianship of the minor to the nearest living relative.  This may not always be the best choice.   Just because someone is related does not mean that they want the responsibility of raising a child.  Children should be loved and disciplined.   They know when they are not wanted.   A reluctant guardian can become bitter and take out the anger on the child.  In some case, the guardian might be a grandparent and they are too old and have no energy or desire to bring up a child anymore.

You can either choose a guardian to bring up your child or you can choose a guardian to look over your child.   The option is yours depending on what you think would be the best case.  You can have fun by thinking through who you can trust to care for your child and who has the same values that you do.

  • Capability.  Love is important but so are discipline and values.   I have friends and family who I love dearly but who I would never trust a child with.   It’s not because they would not be loving but because they are still children mentally.   Do you really believe that someone who is self absorbed or completely flaky would be able to step up and take responsibility for years.   Can you trust them to have that self discipline?

A child is not something that you can put aside until you felt like dealing with it.  Medical emergencies have to be handled immediately.   Tears need hugs and bad deeds need discipline.

  • Control.  Remember that guardianship is not warm and fuzzy as we assume.   It is about total control of someone’s life, your child.   You should make sure that you can trust this person to truly care for your child’s best interest and/or will execute your wishes for your child.
  • Legality.   Guardianship is a legal relationship between your child and the guardian.   It allows the guardian to enroll your child in school, make medical decisions and a whole host of other activities that you take for granted as a parent enjoying full legal rights.
  • Family conflicts.  Choosing a specific guardian helps reduce family squabbles when several members of the family feel that they would be a better choice to take care of your child.  This can happen when there are multiple aunts and uncles with equal claims.
  • Inheritance.  In some cases, you as the parent may need to become your child’s guardian if they inherit an estate.  The guardianship would allow you to manage the assets on behalf of your child because now you have legal responsibilities.

Some important steps to consider about guardianship:

  • Guardian vs. Trustee – A guardian may be capable of taking care of the child but may not have strong financial skills to manage your finances to cover the length of your child’s need.    You may want to consider setting up a trust and a separate trustee to handle the finance and give an allowance to the guardian.
  • Choose a successor Guardian and Trustee.  This is in case the guardian becomes ill or passes away while your child is still young during the guardianship term.   It ensures that your wishes is still being carried out even if your first choice becomes incapable.
  • Do you want to pay the Guardian or Trustee? Is caring for your child an additional financial hardship for the guardian?   Do you want to consider paying them a fee to help with the extra costs?
  • Do you want independent review of the Guardian and/or Trustee? Do you want to have someone such as an attorney to occasionally review your child’s lifestyle and financial situation?  If so, you would need to set that up and provide for fees and guidelines.
  • Your hopes and dreams.   This is the fun part.   This is where you get to sit down and write out all your dreams for your child.   Detailed out how you want your child to be cared for.  Do you want private elementary school?   Are there particular hobbies that you want your child exposed to?   Do you want your child to be able to visit certain family members?   Feel free to brainstorm.
  • Love letters.  Take the time to put down your feelings for your child.   Write love letters that help your child remember you and to guide them.  This is for you as much as for your child.  It is a legacy that your child will remember forever.  When I was going through an illness and needed to set up final dispositions, these love letters helped me come to terms with regrets and guilt.   They validated my love for my family and gave me the energy to fight every day.

Here’s a sample one:

My darling ___,

I want to tell you how much I love you and will always be there for you even if you don’t see me.  I know that I haven’t always been the ___ that you wanted and I irritated you like crazy.   I hope that with time, you will remember the good times we had instead of all the times that I was late to your school events.   I’ve accepted that you will never forgive me for ruining your belief in Santa Claus by accident when I gave you a gift from Santa to put under the tree for _________ .    I’m sorry that you didn’t get to keep the fantasy til you were 12 years old like the others but look on the bright side, you didn’t have to spend 2 days wrapping erasers and pencils in fake boxes or got teased by your friends.   I know that I’ve made many other mistakes that hurt you but always know that I meant well.

I want you to remember that you are beautiful and don’t let anyone convince you otherwise.   Beauty is in the eye of the beholder and how you feel about yourself will control how others see you.   Be confident in who you are.   Stay true to your values and beliefs.  I’ve given you the tools to judge yourself.  You are already going to be your own harshest critic so don’t allow others to add to your burden.

We may not be able to do things together anymore but a bit of me is in everything that you do.   It’s my fault that you can identify a specific designer at 50 feet or be accused of being opinionated when you stand up for your beliefs……….

I will love you always and will be looking down at you from heaven every moment (assuming God allows me in despite my cheeky attitude).

Your loving ________

Make sure that you plan for a guardian for your children just in case something unforeseen happens.   Life insurance and money and things only address a portion of a child’s need.  They don’t tuck a child into bed at night, read stories, kiss boo boos, fight the monsters under the bed, or scare off the neighborhood teenage Lothario.  It takes a human being to give that love and to help keep your memories alive.

It’s not a painful or time consuming thing to do.  Once you set it up, you now have peace of mind and can focus on the future.

© 2010 MoneyandRisk.com all rights reserved

photo credit: Sebastian Mary

Change the World by Redefining Success

21 May, 2010 by Kim Luu
Planning

Recently the Wall Street Journal (WSJ) Small Business section carried an article by Sharon Hadary titled Why Are Women-Owned Firms Smaller Than Man-Owned Ones.   It was an excellent article and Ms. Hadary presented different viewpoints and explanations as to why companies owned by women are smaller than men.

However, the gist of the article is that women have to fight harder for a piece of the men’s pie, get larger, and aim higher because we’re not cutting it.  It is considered a failure that we don’t have an equal amount of woman-owned companies and men-owned companies in the public realm.  In fact, the article caused quite a wave in many women communities and ignited demands that women need more financial support.

Wall Street Bull by Carlossg

I like the article but I disagree with several of Ms. Hadary’s premises and I am sadden by both the tone of the article and by reactions to it.  It is representative of the current world we lived in and showed how far we have moved from our roots both as human beings and as Americans.

The article defined success for any woman business owner as running a multi-million dollar business and preferably in the Fortune 500.  Anything less is not acceptable.   Very few people question this common definition of success.  In fact, success in our society seems to be measured by fame, money, or power.   You can only be successful if you have as much as possible of one or all three of them.

There are two measurements in Ms. Hadary’s article that I disagree with.

1.   We don’t have enough multi-million woman-owned businesses.

I think the numbers are higher than Ms. Hadary cited because those numbers do not count women who are equal partners in multi-million dollar companies.   They are the married women.  Just because they are married does not mean that they should be invisible.  Nor should their companies be considered the sole province of their husbands.   The names of the owners may show the husbands’ first and because the ownership is 50/50, these women are discounted as ghosts.

Many of the “man owned” companies are run by a woman.  The man or husband may be the face of the company because they tend to be the marketing person.  However, when it comes to finance and running the actual operations, the woman is in charge.

These are equal partnerships and I consider these companies to be woman owned companies just as much as one with only a woman at the helm.  Out of the companies that I was introduced to in the past couple of weeks, 70% of them were controlled by the wives.

Let me give you an example of a few “man owned companies” that I work with.  Ownership 50/50

  • $25 Million sales – husband and wife and daughter.  Husband is semi-retired and working on his own project for a second business.  Wife and daughter run most of the operations, finance, marketing, etc..  The company was built together.
  • $50 Million sales and heading for $250 Million – husband, wife, daughter, daughter in law, son.   Husband does vendor reviews and son does customer relations.  Wife, daughter and daughter in law handles everything else.  Shipping, operations, HR, purchasing, finance, AR, AP, etc..
  • $30 Million sales – Husband does surgery – Wife has her private practice and runs six different corporations including their main company.
  • $75 Million sales – Husband works two days a week part time after retirement from his job as an engineer for a public company.  Wife built the business on her own.

2.   Women-owned companies are not successful unless they are multi-million dollar firms.

WHY?  If a woman is happy and making $300,000 a year with a business, she’s less of a success?   Or even $50,000 or $25,000 because that is all that her family need in extra income.  Why are those women considered to be unsuccessful?

Revenue is not what it’s cracked up to be.  There are $50 Million companies where the owner makes less than $100,000 in take home pay.   Yet this business owner is considered to be successful while a woman consultant making $200,000 net income and gross income of $250,000 is a failure.

Does that make sense?

Could I or any other woman build a multi-million dollar company?  Yes with a lot of hard work and dedication.   Would we want to?  That answer will be different from woman to woman.   I have run one.  Do I plan to run another one?   Yes but the more appropriate question is do I want to.   That is the question that I currently struggle with.

Life is not static or predictable but moves in ebbs and flows.  For a woman, life has many cycles from daughter, wife, mother and back to daughter.  Our needs are different at each stages of our lives and we should be free to make choices without being judged.   We need to stop these arbitrary definitions of success that hobble both men and women.

Turtle family by Nickso

I met a woman (J) last month who quit her executive job to spend time with her terminal mother.   She cried telling me (a stranger) her story because I was the only person who never asked her why or make her defend her decision.   I saw nothing wrong with her choice and I didn’t think she was stupid to give up a career she spent 25 years building for love of family.

I remember my friend (T) who quit her job 17 years ago when she was a rising executive star at Xerox.  I remember her guilt, tears and struggle as people castigated her for abandoning her career to raise her children.   I remember being the only one to support her and argue for her choice to live her life without judgment.   I can still hear the arguments from our Wellesley sisters, “you need to break the glass ceiling for women.”  The pressure was so intense that I am still affected by the reactions to her choice almost two decades later.

I took less grief when I made my choice years ago to quit a rising career and take a job with a massive pay cut to go home and take care of my family.  I moved 3,000 miles away from my network so everyone just assumed that I did it for bigger and better things especially since I moved from a private firm to a public company.

Was it a sacrifice monetarily and career wise?  Yes.  I gave up being able to retire as a multimillionaire at 27 in exchange for the joys of supporting a family of 7 on $25,000 a year and millions of dollars in debt.  I was honest when friends asked about my circumstances but they assumed I was fibbing when I told the truth.  No one could accept that I had made that sort of decision.  They decided that I didn’t want to share the juicy details.   One friend asked me for months what kind of company car I chose and ignored my frank comment that I am happy to be able to save $25 a month to rebuild my retirement.

Were we failures then?  If so, who says? and if it’s the people around us, then who cares?  My brother is alive today and that’s not a failure to me.   Did J’s mom think she was a failure because they got to spend six months together?  T and her family downsized from the OC and moved to Ohio for the best time of their lives.   Those kids didn’t think their mom was a failure.

I had the privilege of running across a group of moms a few days ago.   They were blogging because of a challenge set by two sisters.   These were some of the most insightful and honest writings that I’ve seen.    I learned something from everyone that I have read.   One of the blogs (Motherese) struck me because she talked about not having the confidence to comment on another blog when she starts reading.   This is from a woman who started a virtual salon, manhandled her family, got rave from fans, and delighted me with her recount about “Nobody knows the trouble I’ve seen.”   I see success everywhere.

Jen and Sarah from Momalon changed or touched the lives of 89 women in one week.   That’s an incredible success.

I’ll follow Jen and Sarah and challenge you, the reader, to share what your idea of success is.   Just click here and tell us from your heart.

I’ve been inspired for 20 years by a man who I consider to be an amazing success.  He’s a janitor and is only a janitor but that’s a story for another day.

© 2010 MoneyandRisk.com all rights reserved

photo credit: Nickso

photo credit: carlossg

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