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EP 123 | Profit Boss® Radio

This episode originally aired on So Money by Farnoosh Torabi, 8/31/16

I'm excited to bring you a past interview I did with Farnoosh Torabi, an award-winning financial correspondent, best selling author, and television personality. We are replaying an episode that originally aired on Farnoosh Torabi’s popular podcast So Money.

Farnoosh had me on as her guest to talk to her audience about what it takes for women to be successful with money and what some of the most common financial obstacles women, specifically, have to overcome.

Her podcast So Money brings candid conversations about money with the world’s top business minds, authors and influencers including Arianna Huffington, Tim Ferriss, Gretchen Rubin, Seth Godin, Robert Kiyosaki, Jim Cramer, Margaret Cho, and many others.

Farnoosh has been a huge inspiration for Profit Boss® Radio. She has a wonderful style and I know you'll enjoy this conversation we shared.

What You’ll Learn from This Episode
  • Why women tend to perform better in the stock market than men
  • The most important criteria for women to succeed with money
  • The role your money mindset plays in  your financial success
  • How couples can handle household finances after joining together in marriage
  • Hilary’s personal financial philosophy
  • Why automation is one of the best ways you can set and live within success boundaries in your financial life
  • Hear how Hilary got and then dug herself out of tens of thousands worth of debt
  • The one financial behavior that Hilary lives by now that can make all the difference in anyone’s ability to stay on track financially

Related Episodes & Resources #AskHilary

And let’s not forget that this show is powered by you and your stories and questions. Every month I’ll be doing an #AskHilary episode where I answer listener financial questions.

  • So, what’s that top of mind money question that’s been pinging around in your brain?
  • Where have you been stopped?
  • What have you been arguing with your spouse or significant other about?
  • What tip or tool aren’t you sure about?
  • Do you have questions about saving? Spending? Budgeting? Investing?

Pick up your mobile phone right now. Yes, right now. And open your voice recorder app. Yep, go ahead and open that app and record yourself asking me that question. Just say your name, first name only is okay, and then what city you’re from, and then ask away.

Anything you want to ask. And once you’re done recording, export that beautiful little recording and email it to media@hilaryhendersott.com.

I can’t wait to hear your questions!.

Enjoy The Show?
  • Be sure to subscribe to Profit Boss® Weekly so that you get our latest announcements, offers, articles, and resources straight to your inbox!
  • Don't miss an episode, subscribe via iTunes, Stitcher or RSS.
  • Leave us a review in iTunes and share the show with your friends
  • Join the conversation by leaving a comment below!

The post So Money with Farnoosh Torabi appeared first on Hendershott Wealth Management.

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EP 122 | Profit Boss® Radio

Profit Boss® Radio listener stories are some of the most inspiring and, yet, pragmatic financial experiences I am privileged to cover on the show.

Today’s Listener Series episode features Leslie Woods. Her story demonstrates the incredible power anyone can wield if you're ready and willing to roll up your sleeves and say, “YES!” to prosperity. Leslie is a graduate from our $50K Wealth Multiplier Mastermind Program and details her incredible transformation from surviving in a vicious cycle of financial crisis to living in a state of financial abundance. 

Tune in to this week’s episode of Profit Boss® Radio to hear Leslie's inspiring story, and learn about the financial behaviors and money mindset that can lead to financial success.

What You’ll Learn from This Episode
  • What it means to overcome self-limiting beliefs about money
  • How easy it is to invite financial crisis into your life
  • The circumstances leading up to Leslie realizing she had a choice of what her life could be for her and her three children
  • How starting life after divorce with over $300,000 in debt can be managed and overcome
  • The control shame can have on your financial journey but how to turn shame into gratitude 
  • The biggest lessons Leslie learned from her experience
  • How Leslie got out of debt, took control of her finances, and exploded her annual income to nearly $1 million
  • Financial disciplines Leslie lives by today that all Profit Boss® Radio listeners can also use

Brief Summary of Leslie’s Story

Leslie's story is not so dissimilar to anyone who has gone through a divorce or experienced crippling debt. Leslie stopped working as a pharmaceutical sales representative after her and her husband decided to have children. Especially after she had a child with special medical needs, they both agreed that her being home was the best decision for their family. 

But when Leslie's marriage started to go south, she didn't feel powerful in her situation because she wasn't earning an income and also wasn't involved in the household finances. She made the decision to get her real estate license and started a new career in 2009 as a realtor in Silicon Valley, CA. Even though her husband fully supported her decision, the marriage still came to an end, and they parted ways.

When Leslie and her husband divorced, they had a combined debt of about $600,000 that they split evenly in the divorce settlement.  Leslie started her next chapter nearly $300,000 in debt with three kids to support and no place to call home. For nearly five years, Leslie accepted the help and support of family and friends to get her back on her feet. 

During this time of rebuilding her life, Leslie was overcome with feelings of shame and guilt for her financial situation and the impact it had on her children. Yet, Leslie found strength and courage through her children, supportive friends and family, and professional colleagues to forge ahead and figure it out. Leslie vigorously paid down her debt, at times to the detriment of her monthly income and ability to cover basic living expenses.

Then, Leslie learned of the $50K Wealth Multiplier Mastermind after hearing Hilary speak to her office about finances. Leslie decided to invest in herself, and through the program she realized she had some emotional work to do about her finances before she could even fully tackle the practical side of managing her money. Through the $50K Wealth Multiplier Mastermind, Leslie had an awakening to what was ultimately holding her back from reaching financial abundance.

She realized that crisis was what motivated her to make money.

It was this very specific realization that she enabled a cycle of financial crisis – being in a dire financial situation only to dig her way out of it – that prevented her from living in financial abundance.

The rest of Leslie's transformation and how she took her sobering self-awareness and made intentional changes in her life with money is truly remarkable. You won't want to miss hearing how it all turned out for Leslie.

Resources and References Related to this Episode #AskHilary

And let’s not forget that this show is powered by you and your stories and questions. Every month I’ll be doing an #AskHilary episode where I answer listener financial questions.

  • So, what’s that top of mind money question that’s been pinging around in your brain?
  • Where have you been stopped?
  • What have you been arguing with your spouse or significant other about?
  • What tip or tool aren’t you sure about?
  • Do you have questions about saving? Spending? Budgeting? Investing?

Pick up your mobile phone right now. Yes, right now. And open your voice recorder app. Yep, go ahead and open that app and record yourself asking me that question. Just say your name, first name only is okay, and then what city you’re from, and then ask away.

Anything you want to ask. And once you’re done recording, export that beautiful little recording and email it to media@hilaryhendersott.com.

I can’t wait to hear your questions. 

Enjoy The Show?
  • Be sure to subscribe to Profit Boss® Weekly so that you get our latest announcements, offers, articles, and resources straight to your inbox!
  • Don't miss an episode, subscribe via iTunes, Stitcher or RSS
  • Leave us a review in iTunes and share the show with your friends
  • Join the conversation by leaving a comment below!

The post Listener Stories: Leslie 2.0 Overcoming Financial Crisis appeared first on Hendershott Wealth Management.

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When it’s the right time to hire a financial advisor is a good question and one that is personal to your specific situation.

For some people, there may be a major life catalyst like a divorce or an inheritance that abruptly impacts your financial life. For others, it’s not so sudden. It could simply be a growing complexity in your financial situation to the point where you realize a financial professional is necessary to help you manage it all.

There are many instances when hiring a financial advisor is a smart financial decision. If you have been wondering if now is the right time for you to consider adding a financial advisor to your team, here are a few signs and instances that may confirm your suspicions:

Signs You’re Ready for a Financial Advisor

Here are a few tell-tale signs you may be ready to welcome a financial advisor into your financial life:

  1. You have received equity compensation: It is increasingly common for firms to offer equity compensation as part of the hiring package, but once you accept the offer, you take on the responsibility of managing both the costs and benefits of these awards! The tax consequences of certain actions relating to equity compensation are typically immediate. In most cases the tax consequences are irreversible, and the IRS will expect you to pay your taxes whether or not you have the proceeds to do so. Therefore, please don’t DIY this important aspect of earning what you are worth. Equity compensation commonly comes in the form of Employee Stock Ownership Plans (ESOP), stock options: Incentive Stock Options (ISO) or Non-Qualified Stock Option (NSO), Restricted Stock Units (RSU), or an Employee Stock Purchase Plan (ESPP).
  2. You’re starting to think seriously about retirement: There comes a time in life when you realize that you’ve been saving diligently for many years but you aren’t quite sure how far along you are or if you have done enough to secure your future. If you’ve wondered, “When can I retire?” or “How much more do I need to save?” or “How much will my retirement income be?” you are likely in this phase of life and ready to work with a financial advisor.
  3. You’re changing careers or employers: Whenever you make a big move professionally, it can impact your financial life. Especially if you are changing careers or switching employers as a seasoned and highly-compensated professional. A financial advisor can help you transition your retirement assets and reassess your finances in light of your new circumstances. For instance, if you are changing employers and have a large 401(k) balance, you need to take that with you by rolling it into an IRA when you leave your current employer. You definitely don’t want to trust your entire financial future to some Wall Street mutual fund manager.

  4. You are getting a divorce: Splitting assets after a marriage comes to an end can be tricky business. A financial advisor can ideally help you work through the financial details and coordinate with your attorney so you can negotiate terms that represent your best interests, as well as understand what a final settlement means for your future. From there, a financial advisor can help you put back the pieces of your financial life after a divorce and create a plan designed to help you reach your financial goals in your next chapter of life.
  5. A loved one has died or has become injured: If you didn’t have a financial plan in place before the passing of a loved one or before a major injury, now may be the time to reach out to a financial advisor. With the loss of a loved one, many estate issues can arise that impact your finances. In the case of injury, if you or your spouse is unable to work, re-evaluating your finances and insurance coverage is a necessary step to help keep you on track as you navigate your new circumstances.
  6. You’ve suddenly come into a large amount of money: If you’ve suddenly come into a lot of money, it can be overwhelming to know how to handle it responsibly. A financial advisor can help you align your new wealth with your goals and priorities. One of the highest values a fee-only fiduciary financial advisor can offer is helping you make smart money decisions that are in your best interest. So, whether you are one of the lucky few to win the lottery, are the recipient of an inheritance or large settlement, or come into a lot of wealth unexpectedly, it’s probably a great time to start interviewing financial advisors.
  7. Your finances aren’t coordinated: Maybe you have a CPA that does your taxes, an investment advisor that manages your investments, and an insurance broker who sets up your coverage. But each aspect of your financial life is compartmentalized and none of your financial professionals are coordinating their efforts on your behalf. Frankly, when this happens you run a big risk that when something changes in one aspect of your financial life, it will actually contradict or undermine one of the strategies in another. If this is you, it’s definitely time to consider a financial advisor.

  8. Your finances have become complicated: In my experience, most people handle their finances on their own until complex financial issues cause them to reach out to a professional. Maybe you own a business and need a tax-deferred savings account, own multiple real estate assets, find yourself in complex investments, or any other number of situations that exceed your level of expertise or comfort level to handle your finances anymore. When this happens, it’s a good idea to reach out to a financial advisor who can manage complex financial matters like these while ensuring you are still on track to achieve your longer-term goals.
  9. The weight of your financial decisions carries much higher risk: When you are young and just starting to build toward your future, a financial misstep here or there probably didn’t set you back too far. However, as you advance through the years and your career and get closer to retirement, you don’t have the same luxury of time to rebound from a financial mistake.  A financial mistake in your fifties with hundreds of thousands, if not millions of dollars, could delay retirement or dramatically alter your lifestyle in retirement. As your wealth grows, so, too, does your potential for great losses if you make a financial misstep. This is when having a financial advisor is critical to your success so you have someone helping to safely steer you, and keep you, in the life of your dreams.
Conclusion

As a word of caution, it’s worth noting that some financial professionals who call themselves financial advisors or planners are really just commissioned-based investment managers and only focus on and care about the accounts they manage. In all the signs I mentioned above, working with a credentialed, educated and experienced, fee-only fiduciary advisor is what I recommend.

As a CERTIFIED FINANCIAL PLANNERTM (CFP®), it is my highest goal to help clients reach financial goals and achieve the life of their dreams. If you are even thinking that it may be time to work with a financial advisor, chances are it is! I can’t overstate how valuable it is to have an objective and qualified professional working with you to manage your financial life.

Because we at Hendershott Wealth Management are comprehensive advisors, we take a big picture view and can help ensure that all of the aspects of your financial life are working in concert with one another. From ongoing financial education, management of your investments, creating a tax-efficient strategy, preparing for known and unknown obstacles, providing accountability for the steps you need to take to reach your goals, and all around planning for financial success… that’s what comprehensive financial advisor can do and what we can do for you.

Reach Out to Us

If now is the right time to consider bringing a comprehensive financial advisor on to your wealth team, we’d love to chat. Our initial series of conversations are complimentary and without obligation and will likely be quite valuable to you in your long-range thinking and planning. Go here to schedule a Discover Meeting where we can both find out if we might be a good fit to work together. We’ll be in touch right away to schedule your call! We look forward to hearing from you.

The post 9 Signs It’s Time to Hire a Financial Advisor appeared first on Hendershott Wealth Management.

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How much you should fund toward your child’s future education is a question that isn’t the easiest to answer, but there is a way to figure out what works best for you and your family.

It is no secret that the cost of college education is increasing faster than inflation or stock market performance. Over a 30-year period, college tuition (not including the total cost of education) has risen nearly 400% according to the National Center for Education! Understandably, this can leave many parents overwhelmed at how to successfully plan for this huge future expense.

After you have a child, one of the best things I can recommend is that you open a 529 plan to start saving for your child’s future education cost. Among the myriad accounts that are available to do college tuition savings, including UGMAs, UTMAs, and the like, 529s are the hands down winner. The top benefit of using a 529 plan for college savings is that your investment grows tax-free. The second benefit is that withdrawals aren’t taxable as long as they are used to pay qualified higher education expenses. Third, the owner of the account remains the owner of the account until they die – there is no other time limit to the account, and the funds aren’t passed to the beneficiary at a specific age. Some states also may offer tax deductions or tax credits in the year you put money into your 529.

But how do parents figure out how much money they should contribute to a 529 plan a month? Many people just pick a random number like $50 or $100 a month and hope that will be sufficient.

Instead, here is a quick, yet effective, process to determine how much money to fund toward your child’s future education.

Project Future Education Cost

First, you’ll want to understand what your child’s projected future education costs are. This doesn’t mean you have to fund the entire amount, but it’s helpful to know what college costs will look like when your little one is ready for post-secondary education.

You can access online college tuition calculators to help you estimate what your child’s future educations costs will be however many years from now. For example, if your child is 1 today, in-state public tuition is projected to cost a whopping $158,152 in 2035. Private college tuition is estimated to cost $294,807.

Set a Goal

Next, you’ll want to set a goal so you can work toward a real number. For some parents, they decide they want to cover tuition and materials and have their child pay for any experiential and living costs like rent and entertainment. Other parents decide they would like to be able to cover all of it but limit their child to in-state public schools where the tuition is significantly less than private schools. And other parents may push their children to work toward scholarships and grants to help cover the cost of their education.

There is no right or wrong answer. This is a decision and a goal completely personal to you and your family. But whatever it is, setting a goal will help you take the necessary steps to reach it.

Determine Your Monthly Contribution

Determining your monthly contribution toward your child’s future education costs is often the most elusive step in the process. As with any financial goal, it shouldn’t be made in isolation of your overall financial situation and long-term goals.

While the first two steps in the process help make it clear what education costs are likely to be and how much you would like to be able to fund toward that total cost, the third step in the process is incorporating education planning into your overall financial plan to ensure that you do not undermine other important financial goals like retirement. Remember, there are no loans or scholarships for retirement. So, if you underfund for your own future, there is no recourse.

Therefore, revisit your cash flow. Make sure you are maxing out your retirement first, then account for all your fixed and known expenses like the mortgage, utilities, insurance, taxes. Finally, take a hard look at your variable costs like meals, entertainment, and shopping. You have two options: 1.) Whatever money is left over can be earmarked for funding a 529 Plan, or 2.) You can make lifestyle adjustments if necessary so that you can fund more money toward the education goal.

[RELATED CONTENT: How to Pay Less for College]

Set Expectations and Provide Guidance

As a parent, you may be tempted to borrow against your future to provide for your child’s education costs. Don’t. The last thing you want to become is a financial burden on your children later in life. Therefore, do what you can and plan for a number that works for your family. Then, set clear expectations with your child so that they don’t operate under false assumptions.

There is so much value you bring well beyond the funding of tuition. You can help prevent your 17-year-old from getting saddled with too much student debt through, yes, the savings in a 529 plan, but by also helping them make a sound financial decision when it comes to navigating their education journey.

Things like:

  • Helping your child understand the ROI of their education so they don’t assume more debt than their first year’s projected income
  • Finding and applying for scholarships and grants
  • Understanding the value of hard work and the worth of a dollar
  • Comparing the costs of multiple institutions and ways to achieve the greatest value
  • Earning college credits while still in high school and starting internships early
  • Considering community colleges for prerequisites and then transferring to a 4-year accredited college for a Bachelor’s Degree
Conclusion

There is no right or wrong answer to the “how much SHOULD you fund” question. The answer is some intersection of your values, your history, and your ability to pay.

Some parents, unfortunately, cannot pay anything. If that is the case, your child simply must find academic or athletic scholarships or grants and that may dictate where he or she goes to school. Some parents want the college years to also be financial learning years for their kids. If this is your wish, you can choose to pay for all or part of tuition, but expect your young adult to work to cover the remaining expenses. Yet, other parents had college completely covered by their parents and want to extend that legacy. For the rest, it was just the opposite… if your parents covered nothing, and you suffered because of it, maybe you want to make up for the perceived sins of the past.

Whatever your core values are about paying for education, you still should not write a check bigger than you can afford. So, the answer is to marry your desire to pay with your ability to pay. Sometimes coming up with a number is the hardest part of the process.

Education planning is part of financial planning. The earlier you start, the more likely it is that you can reach your financial goals. If you have questions about education planning or would like more guidance on how to incorporate it with your overall financial plan, selecting the right 529 plan, or how to reach your financial goals, don’t hesitate to reach out to us or your financial advisor.

The post How Much Should You Fund Toward Your Child’s Future Education? appeared first on Hendershott Wealth Management.

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