Did You Get a Flat Tire on the Road to Financial Wellness?

I met with a client the other day who was simply trying to pull up his most recent 401(k) statement for me to review and, forgetting his password, got sucked into Log-In-Reset- Password-Hell.

I have another client who was supposed to follow up with me
for more financial coaching sessions (which she already paid for)
but since her divorce she has fallen into a “I don’t care about anything” place.

Another client is mourning the loss of her Mom (the anniversary of her passing was looming in her calendar) and, despite her desire to implement my financial recommendations, cannot seem to focus her mind on those kinds of tasks.

A friend who regularly responds to my emails for the
“I HATE Budgeting (But I Like Having Money)” support group
is somehow never able to attend,
something always comes up, usually that morning.

Just now I was going to include an excerpt from a favorite poem. I have it attributed to one author (Jeremy Taylor, a clergyman from the 1600s) but a Google Search has it attributed to someone quite different (Ann Landers). Do I post it anyway?

This is daily life for most of us.

I’m presenting a seminar this week on budgeting and how most people think it is a matter of mathematics and discipline.

That’s so cute. Adorable, really.

The truth is, our lives are complex recipes and the ingredients are relationships,
and relationships involve dozens of different emotions or feelings all on the
<– love –> -> -> -> ->-<- <- <- <- <–fear –>
spectrum (attention, affection, appreciation, commitment, care,
responsibility, duty, expectations, conflict, inadequacy, resentment, avoidance etc.).

Let’s call a spade a spade: We make most decisions, especially financial decisions, largely based on – or influenced by – our emotions. That vacuum cleaner you’re eyeing up has emotional fingerprints all over it (did you ever see the “Everybody Loves Raymond” episode with the vacuum cleaner?), as does the TV, couch, dishes, artwork, letter from a charity, college education… Don’t even get me started on holiday shopping.

If you find yourself stuck, it’s most likely because an emotion is not being recognized and addressed. You must be wondering, “Well, how do I get back on track?” I don’t know how you’re wired but I tell you what seems to work for me and many of my clients:

  • Think about the priority of the issue. If it isn’t that important (and sometimes it’s hard to know if it is important, or “right,” or “true” or “best”), trust me, you will find every excuse not to do it.


  • Think about the urgency of the issue. If it can wait (and, of course, it most likely can), you’ll find a million things to do to ensure that it gets put on the back burner.


  • Be aware that, if you feel at all ashamed or that you’re being judged, you’ll stay stuck on the side of the proverbial road. A mental exercise regimen of self forgiveness, self-confidence  and setting and maintaining boundaries may be needed, perhaps with the help of a licensed mental health professional.


  • The most important step is to think about what you really need right now; be that a good cup of coffee, an afternoon off, some good music, a great joke, to find a new job etc.

Taking time to identify what you need and what is at that need’s core  (a sense of order, to simplify things, to feel appreciated, to feel cared for, to feel connected etc.) helps you become unstuck; it’s like finding the right tool for the job. If you don’t identify what you need, you will fill your life/house/mind with stuff trying to get that need met. You’ll “wander and squander” your time, money and energy.

If you’re on the road to financial wellness, let your emotional needs be your GPS and treat them with the importance and urgency they deserve. If you happen to get a flat tire, think of your spare tire as your Plan B; which is constructed with the same core needs and values as Plan A.

Peace & abundance,
Amy Jo

Posted in Personal Finance with a twist, Psychology of Money | Tagged | 4 Comments

104 Ways to Feel Better About Your Financial Situation

In a nod to a wonderful post titled 101 Ways to Feel Better About Your Recent Weight Gain I am offering my 104 ways to feel better about your finances.

  1. This too shall pass.
  2. Even if it takes a long time, you will get to the other side of this.
  3. You are not alone, even though it feels that way. Lots of people struggle, you just don’t know because people don’t talk about money.
  4. “Money is only a tool.  It will take you wherever you wish, but it will not replace you as the driver.” – Ayn Rand
  5. You are capable of making good decisions.
  6. You have many options, including doing nothing at all.
  7. You can get quiet and realize you have all you need to choose the path that’s right for you.
  8. The world may tell you that you’re wrong but you don’t have to believe it.
  9. You may doubt yourself but the fact that doubt makes you feel yucky means it’s a lie.
  10. If you are vacillating it means you’re listening to conflicting voices/opinions. Find your own and follow it.
  11. It’s okay to feel overwhelmed, it happens to everyone. It doesn’t mean anything.
  12. Sleep on it.
  13. Talk to someone you trust.
  14. As my Mom would say, “Pray for guidance and go accordingly.”
  15. If you’re normally pessimistic (even if you prefer to think of it as being “realistic”), try on optimism for a half an hour today.
  16. Worry gives you the illusion that you’re controlling things but really it’s the worry that’s controlling you and is keeping you stuck.
  17. If you’re a worrier by nature, set a time limit (such as 15 minutes) for your worry time for the day. Once the time is up, so is your commitment to worrying.
  18. Did those 15 minutes change anything?
  19. Since they did not, realize that the difference between worrying about money and thinking about money is that thinking about money results in a decision.
  20. A decision is an off-ramp from the worry highway.
  21. Every incremental decision you make to become more whole, more at peace, makes you more whole and at peace.
  22. When faced with a financial decision, realize the emotion backing it. Name it. Then it won’t have power over you.
  23. If the emotion is fear-based, identify the worst case scenario or outcome and then ask yourself, “What is the probability of this outcome?”
  24. If the probability’s less than 100% move on. It’s just a distraction.
  25. Sometimes we create obstacles to give us time to process a decision.
  26. Acknowledge that you need time and perspective so you don’t have to rely on the obstacle(s).
  27. Anything can happen.
  28. Including the incredibly easy, joy-filled, good stuff.
  29. Just because it isn’t easy doesn’t mean you’re doing anything wrong.
  30. Just because it is easy doesn’t mean you’re doing anything wrong.
  31. Everyone is on their own journey.
  32. All your best decisions are those made in love.
  33. Ask yourself what love-based decisions look like so you’ll recognize when you’re making them.
  34. Have you noticed that most of these can be applied to other areas of life?
  35. Find an area of your life that’s going well and duplicate those behaviors in your financial life.
  36. “He who is not contented with what he has, would not be contented with what he would like to have.” – Socrates
  37. If you can be impulsive, get to know yourself so well so that when you do act on impulse, you can trust that it’s the right move to make.
  38. If you don’t know what is important to you you’ll continue to wander and squander.
  39. You can always choose a different path.
  40. “To accomplish great things, we must not only act, but also dream; not only plan, but also believe.” ~ Anatole France
  41. Your ego will always tell you that you are not good enough, that you don’t have enough, and that you’re not doing enough.
  42. Your ego is a liar.
  43. Since your ego does not like being called a liar, it will continue to try to make you believe it. Prepare for battle. Cross examine this false witness.
  44. “Happiness is not in the mere possession of money; it lies in the joy of achievement, in the thrill of creative effort.” Franklin D. Roosevelt
  45. If financial security is your goal, what does financial security look like? Is it a certain amount in savings? Not having debt?
  46. If you’re on a mission to increase your savings, keep a little note in your wallet or on your phone that has a reminder. You’ll look at it every time you open your wallet or phone for something else.
  47. If you’re on a mission to decrease your debt, keep a little note in your wallet or on your phone that has a reminder. You’ll look at it every time you open your wallet or phone for something else.
  48. “Our beliefs are the invisible ingredients in all our activities.” ~Wayne Dyer
  49. Regret is the most expensive emotion. It is a bill you’ll pay the longest.
  50. Decide when your bill-of-regret is paid-in-full.
  51. Practice forgiveness (towards yourself and others) for financial mishaps.
  52. Practice again.
  53. Practice some more.
  54. Where you are now financially isn’t where you’ll be forever unless you choose to remain there.
  55. It’s typical to choose to remain in your current situation because it feels familiar and the unknown is scary.
  56. But how scary can it be, really?
  57. Imagine how your life, your relationships, your health, your perspective, etc. might change if your financial situation were to improve.
  58. Even if your financial situation didn’t improve, how might those things change?
  59. Don’t fear the numbers. The more you know, the more you can control.
  60. The more you know, the more you can choose.
  61. The thought of having to choose (and possibly choosing “wrongly”) is why most people procrastinate or avoid thinking about money.
  62. Procrastination will leave you feeling frustrated. Don’t put up with it.
  63. Avoidance lies to you by saying that it will protect you.
  64. Don’t fall for its lies.
  65. Avoidance really keeps you stuck and can lead to despair.
  66. Success is purely subjective.
  67. I don’t have to replicate someone else’s results to consider mine successful.
  68. Define what “success” means to you.
  69. Progress is positive.
  70. Lack of progress is a lesson in patience.
  71. And patience is a virtue.
  72. Just look how virtuous you are!
  73. Is there any proof that you’re financially messed up?
  74. Even if there is proof, is there any proof that you can’t straighten things out?
  75. You will be motivated by what you most value in the deepest part of you. Look at it.
  76. If you value freedom, what choices can you make financially that will help you be free?
  77. If you value comfort, what choices can you make financially that will help you feel comfortable?
  78. If you value security, what choices can you make financially that will help you feel secure?
  79. If you value _________what choices can you make financially that will help you feel _____________?
  80. As Joel Osteen says, “Speak victory over your life.” Instead of saying “I’m a financial mess,” say, “I used to be a mess financially but now things are starting to improve.”
  81. Give yourself a break.
  82. “Be grateful…. It’s the only totally reliable get-rich-quick scheme.” —Ben Stein,
  83. Before tackling a financial task (balancing your checkbook, paying bills, researching your retirement plan) create a pleasant environment. Read Money “Mise en Place.”
  84. Learn how to say “no” without guilt.
  85. Learn how to say “yes” with courage and confidence.
  86. Don’t make any impactful financial decisions when you’re under stress.
  87. To avoid #81, create financial policies for yourself.
  88. When you or anyone else feel afraid, it usually comes out as anger. Once you know this, you’re less likely to respond with anger.
  89. Some of your money must be for your enjoyment or you will become bitter and resentful. Allow yourself some treats.
  90. Judging yourself or anyone else doesn’t offer any benefit and changes nothing.
  91. You can do everything you believe you’re “supposed” to do with your money and still not have the results you desire.
  92. Determine what actions make sense to you.
  93. “Make all decisions based on the person you would like to become.” – Paul Homoly
  94. Emotions can distort our vision, especially when it comes to money. Take a breath and return when you’re calmer and clearer.
  95. Give up your addiction to comparing yourself to others.
  96. “Comparison is the thief of joy.” Theodore Roosevelt
  97. Your credit score doesn’t define you as a person.
  98. Almost everyone is weird about money, it’s not just you.
  99. Try to determine who is in your head as you think or worry about money. Did you inherit thoughts from a parent? Who is influencing you?
  100. Reading about personal finance can be a very clever form of procrastination if you don’t act on anything.
  101. It’s okay if you can’t afford it.
  102. Generosity is always a good choice.
  103. “Empty pockets never held anyone back.  Only empty heads and empty hearts can do that.”  ~Norman Vincent Peale
  104. What one small step might you take this minute that could set you on a more positive path financially? Leave your ideas in the comments!

Peace and abundance,
Amy Jo

Posted in Goals, Living the life of your dreams, Personal Finance with a twist, Psychology of Money, Saving, Tackling debt | Leave a comment

Budgeting with Irregular Income & The Basics of the 3 Budget System

The 20th century saw great advances in manufacturing and, therefore, employment, especially after WWII. Reliable, steady employment created a foundation of financial security from which many benefitted, around which an economic system was built.

The 21st century, not so much.

With the rise of the gig economy, more people are trying to understand and yield to the rhythms of irregular cash flow.

Career to retirement coach Saundra Loffredo and I agree that we see many people in both our practices who have created a “portfolio career,” one that includes many components (such as freelance work, business income, perhaps part-time employment etc.) and, as a result, can have multiple sources of income…it’s just irregular income.

I’ve blogged about budgeting with irregular income previously, but there was a need for a refresher course. There are lots of other sources including:

While most of us are saying the same thing (identify your core expenditures, budget around that and save the rest), there might be a sentence that resonates and could make all the difference to you.

As my dear friend Nancy Rizzo says, “Mindset first.” Therefore, we started our discussion at the “I HATE Budgeting (But I Like Having Money)” support group by talking about mindset.

We talked about:

Tackling fear: Once you have researched and considered all the variables, one of the best things you could do for your own peace of mind is to commit to your chosen course of action.

“Until one is committed, there is hesitancy, the chance to draw back.
Concerning all acts of initiative (and creation), there is one elementary truth that ignorance of which kills countless ideas and splendid plans: that the moment one definitely commits oneself, then Providence moves too. All sorts of things occur to help one that would never otherwise have occurred.
A whole stream of events issues from the decision, raising in one’s favor all manner of unforeseen incidents and meetings and material assistance, which no man could have dreamed would have come his way.
Whatever you can do, or dream you can do, begin it. Boldness has genius, power, and magic in it. Begin it now.” 
~Johann Wolfgang von Goethe

Excitement versus fear: They are almost identical physiological responses. Ask yourself, “Do I feel excited?” The possibilities of making bold life choices can feel exhilirating…or like a panic attack.

Making Ends Meet & Managing Social Settings & Obligations: Get creative & resourceful. What is a less expensive way of doing/having something? As one participant who is recently retired said, “I can do a lot of fun stuff for free.”

As a regular participant said, “It does matter who you’re around.” Indeed! Not everyone will understand or support your life choices let alone your financial ones; best to accept that and find a tribe you can trust and lean on.

Do your friends want to go out to dinner? Suggest going for lunch or coffee instead. Better yet, offer to make them lunch or coffee at your place.

Another support group regular uses the phrase, “It doesn’t make financial sense to me,” when confronted by a well-meaning loved one who has different financial ideas and strategies. That’s good because it asserts your own position without casting judgment on another’s.

On the other end of the spectrum, you can also go overboard bragging about your frugality!

The monthly payment lifestyle: This can be a problem because someone with irregular income cannot always make regular monthly payments (not to mention the problem of focusing on monthly payments rather than calculating the true cost of a product or service). Stated monthly payments can provide regularity for an otherwise chaotic budget, but they also reduce your ability to control (read: reduce) your payment.

The problem with many budgets
is that they don’t address
the unexpected expenses that come up
such as a fender bender for which you have to
pay your insurance deductible,
a pet situation (tests, veterinary care),
or my-in-laws-are-coming-to-stay-and-I-need-to-hire-a-cleaner.

For this you need to constantly fund your financial stress reduction account
(savings account for the lay person, emergency fund for the pessimist).
If it’s not funded adequately (as it may not be yet), you’ll have to rely on credit
and make the payments a priority as you also fund your financial stress reduction account.

If you’re going to live with irregular income, you’ve chosen a very special adventure. In the words of attorney Heidi Jones, “Pack light for the journey.” This means, identify what’s really important to you; what’s worth your money? What isn’t?

The basics of my 3-Budget System: Most people with irregular income have some “average” months, some “flush” months and some “lean” months. This could be due to seasonal work/demand for work (such as landscapers and tax preparers), business cycles, lack of sufficient invoicing/payment models or other reasons.

What I help people do is identify each of these months and align the income with the expenses they face. The first thing the client must do, however, is identify their core expenses. This takes a few weeks to track and become aware of spending. Once we have that core budget, we can develop the client’s 3-budget system.

1. The Essential Budget Month(s) – This is for months when income is lower than normal. Live within the core budget constructs, drawing from savings (which is funded through deposits made during average or flush months) if needed.

2. The Average Budget Month(s)– This is for average months. Additional income over essentials goes towards saving, enjoyment, additional debt payments, or all.

3. The Flush Budget Month(s) – This is for when you’re super busy and you’re more likely to require more products and services because you’re not able to manage them with your time devoted to work (such as take-out food, additional child care, or housecleaning). So your essential budget will be increased to reasonably account for that fact. Then, additional money is allocated towards saving, additional debt payments, enjoyment or all.

As our recently retired participant shared, “I want to be free to be the master of my time.” And I might add, the master of her money, too.

Want more than a blog post? Pick up one or both of my books, join us at a meeting, book me to speak to your group, or check out my services.

Peace be with you!
Amy Jo

Posted in Personal Finance with a twist | Tagged , , , | Leave a comment

Creating & Maintaining Healthy Financial Boundaries

“You have to try tough love.”
“Don’t be an enabler.”
“I’m scared he won’t survive without my help.”
“We’re all doing the best we can.”
“We can’t afford that!

“The heart has its reasons which reason knows nothing of.”
~ Blaise Pascal

I learned at a recent presentation on behavioral finance that the original economists were former WWII strategists, applying the same rationale and statistics/probabilities from war to how people make decisions about money. They assumed if everyone knew the “best” outcome they would simply – and certainly – choose that. Ha, ha! That’s so funny! Almost all of our financial decisions are made using some degree of emotion (yes, even my rational engineers do!).

Money gets to a tender place in all of us.
It touches so many areas of our lives, and resides in so many layers.

The trick, I think, is to find what drives your emotions (such as your values i.e. faith, justice, and harmony and needs i.e. security, comfort and understanding) so you at least know why you make the decisions you do…and then make the best choice you can based on those aspects of yourself.

For example, if you value your family, make decisions that will truly benefit your family, and try to define what that looks like so you can recognize it.
If you need security, what decision will make you feel more secure?

The wonderful Sarah Haykel lead a discussion about healthy boundaries at the “I HATE Budgeting (But I Like Having Money)” support group. In its simplest form, a boundary means identifying when and why you say, “yes” and when and why you say, “no.”

This is the white board indicating all the varied responses regarding boundaries. 

If this photo overwhelms you, in brief, boundaries can be any and all of the following:

  • Rules for living (note: emotions will ask – and even demand – that you to bend the “rules”)
  • Limits (note: people we love will test our limits)
  • Policies (that we establish when we’re calm and rational and not when we’re stressed and emotional)
  • Supports (when we feel our decision is challenged)
  • Permission (when we need to say, “No” but are afraid we’ll damage the relationship)
  • Protection/Shields (When who we’re saying, “No” to is upset with us. Sarah says, “Preventative and proactive are protective.”)
  • The Path of The Middle Way (From Zen Buddhism, to keep you from extreme overspending and extreme underspending, just like you cannot only inhale or only exhale, you must do both.)
  • A means to understand and accept others’ boundaries while staying true to your own without judging – or fearing judgment. “He who would not forgive must judge, for he must justify his failure to forgive.” A Course in Miracles

I’ve blogged about some aspects of this topic in regards to creating a personal financial policy. For example, when you’ve been invited to the umpteenth in-home sales “party” (i.e. cooking gadgets, jewelry, purses etc.) you can reply, “It’s my policy not to attend sales parties.” Done.

Similarly, behavioral finance gurus Richard Thaler and Cass Sunstein coined the term choice architecture featured in their groundbreaking book, Nudge: Improving decisions about health, wealth, and happiness.

One of Sarah’s financial protection policies uses the metaphor of a parking ticket: don’t just put in the $1 you think will cover your time and risk getting a $30 ticket, put in $5 that will cover you in case you’re late.

Developing healthy boundaries can help us to feel free and content,
and can be a means where we can learn to trust ourselves;
to be consistent rather than conflicted.

What’s nice about boundaries or financial policies is that they’re flexible to deal with life’s changing circumstances. Tracking your expenditures gives you good data to create a policy or boundary and can be the foundation of a workable budget.

Side note: We meet upstairs from the cafe. At one point in our meeting, the smell of burnt toast permeated the air and distracted us from the conversation at hand. We all took it as symbol meaning there are times when we’re not paying attention to our finances and then something undesireable happens! Pay attention, don’t burn the toast!

Sarah shared her “Free to Be!” process:

And reminded us that, often when we’re afraid, we’ll hunch our bodies over in need of comfort and protection. Sarah instructed us in making a “Power Stance;” a position of authority and control that gets the powerful energy within us to direct our highest and best choices (think “Wonder Woman”).

In closing, these are some of the responses to the concept of boundaries:

  • Annette: Research, decide, trust, let go.
  • Sarah: Fluidity of cash flow, individualized and situational.
  • Merridy: A tool for self-care.
  • Bill: “If I’m serving enough, I don’t have to worry about money.”
  • John: Everything in moderation.
  • Heidi: The Power was there all along.
  • Debbie: Money is a tool for intentional joy.
  • Joy: Practicing Loving Kindness through blessing others with money.
  • Ruthann: Not feeling stupid or regretting past decisions, feeling confident.
  • Anne: Pause and consider the possibilities.

Can you see how joyful talking about money can be?! If you’re in WNY, join us!

Posted in Budgeting, Goals, Money in relationships, Personal Finance with a twist, Psychology of Money | Tagged , , | 1 Comment

How Women Navigate The Belief That “Money Means Security”

“Our beliefs are the invisible ingredients in all our activities.”
~Wayne Dyer

I have a few women business friends who gather monthly to discuss goals, struggles and achievements. We serve as each other’s cheerleaders, coaches, and/or accountability partners.

Two of the women set goals a few weeks ago, so I texted them both to remind them and provide some moral support. They did the same for me, which meant I had to tackle a pile of random papers (you know what I’m talking about, business cards from networking events, notes from seminars, articles I meant to read 5 years ago, promotional notepads from expos, thank you cards received).

This pile resides in my office closet and haunts me every time I hang up my coat, which is regularly now that it’s January in Buffalo.

One of the file folders contains my enneagram; my personality profile created by Joan Graci of APA Solutions. I am “The Helper,” my primary motivation is social (I am a people pleaser, there, I said it), but my secondary motivation is economic.

They also included my DISC profile and I’m considered a person of “Steadiness” but have adapted to being an “Influencer.” My style of financial planning (a combination of economics, holistic wellness, spirituality and sociology) is a reflection of how I’m wired to love people and understand that they need money.

Another file folder contains a multitude of articles and references regarding pay inequality and related issues (such as maternity leave & divorce settlements) faced by women around the world. It is the one file I simply do not want to go through. There it sits, underneath the bag of Dove dark “office chocolates.”

  • I’ve blogged about my feelings regarding equal pay, both as a women and as a financial planner.
  • I wrote an article several years ago proposing that enforcing the Equal Pay Act would help Social Security, since Social Security is funded by payroll taxes (6.20% of earnings up to $128,400 in 2018). If someone earns more income, they pay more Social Security taxes. That would help Social Security stay afloat longer, right? I sent it to then-Senator Hilary Clinton.
  • I started writing a book about women and money years ago, but put it on the back burner because I am too busy helping my clients navigate their financial lives.

Many of you reading this know that I perform this little survey when I’m presenting somewhere. I invite people to “vote” with a penny for the cup that represents what they think money means.

  • When I’m at a business event (both genders), most of the pennies go into the “money means freedom” cup.
  • Curiously, at a senior apartment complex, the cup with the most pennies was “money means greed.”
  • Often, when I’m at a spiritual event, I hear, “None of the above. Money means nothing.”
  • When I’m at a women-related event, most of the pennies end up in the “money means security” cup.

I just started reading A Course in Miracles. The first lesson instructs you to look around and name everything you see and say that it doesn’t mean anything.

This was an easy task with,

  • “My bed does not mean anything,”
  • “The window does not mean anything,”
  • and “This pen does not mean anything.”
    But the task became more challenging with “This nail polish doesn’t mean anything,” because my nails are currently painted red in memory of my Mom who always had lovely red nails. This nail polish does mean something, it’s a symbol; it communicates something meaningful about me and about someone I loved. Money can be a symbol, too, and that’s where we can get into trouble if we’re not careful.

My husband was driving us to lunch at our favorite Indian restaurant yesterday when it dawned on me:

Most women need a sense of security
and, for women, money typically means security.

Because of this, some women may accept lower salaries because they may believe they’re safer doing so.

Stick with me.

In the event their employer had to cut staff,
if they earn less,
they’re less likely to lose their job and more likely to have some financial security.

Plus many women fear negative judgment; asking for more money (they believe) makes them look greedy. They will err on the side of caution because (they believe) that’s where security lives.

Income inequality is a complex issue because most people are really weird about money; having it and not having it. Money means different things to different people. We assign meaning in an attempt to understand patterns in life and to justify a system of rewards or consequences. We develop opinions of what should be done with money based on what money means to us; not always realizing that it means something different to others. I once overheard a conversation that went something like this: “I don’t know why she even works, her husband has a good job.” Well, maybe that women wants to be in control of her own income for any number of reasons and you know what, she doesn’t need our permission or approval.

Because everyone views money differently, no solution to pay inequality, welfare, or taxes will work for or make sense to everyone. I ask that we all please stop making pay inequality about women’s inability to negotiate higher salaries and understand that they may be making financial decisions based on their need for some level of financial security. Most women are overwhelmed as it is and don’t need one more thing to feel inadequate about.

Need more than a blog post to navigate your finances? Let’s talk!

Posted in Personal Finance with a twist, Psychology of Money | Tagged , , , , | Leave a comment

What People are REALLY Thinking About the New Tax Bill

I’m surrounded by conversations about the new tax bill. In between “Rudolph the Red-Nosed Reindeer” and a remix of Leonard Cohen’s “Halleluja,” my day is sprinkled with tax bill news.

Colleagues, clients, friends and even strangers talk to me about it. It’s all over radio, TV and social media. I’d provide a link but, honestly, I don’t need to. I can almost guarantee that, within the next 10 minutes, you will hear or read something about the new tax bill.

What my colleagues and collaborative advisors (CPAs, tax attorneys) are saying:

Do your charitable giving this year while you can still itemize your tax deductions. (Note: You can still itemize your deductions and charitable contributions are still deductible, but the standard deduction is doubling, therefore, it’s less likely you’ll have enough deductions (meaning more than the standard deduction) to itemize them.)

Don’t bother paying your January 2018 estimated state tax payment this year, thinking you can still deduct it an itemized deduction (April’s, July’s and October’s are “safe,” I’m told). (Note: The new tax bill either limits or does away with the state and local tax deduction.)

Will people complain about my fee? This is because miscellaneous itemized deductions are going away, which include tax preparation fees and investment advisory/financial planning fees. These also include un-reimbursed employee expenses (including uniforms, union dues, and employment-related travel, for example). Possibly, with lower corporate taxes, the company can reimburse these expenses themselves.

What my friends are saying:
Our close friends have six children. I know another family who has 10. With the personal exemptions going away ($4000 per person), even doubling the standard deduction can’t offset the loss of the personal exemptions. I believe the Child Tax Credit being increased is meant to help in this regard. Remember, a credit can be more valuable because it’s a dollar offset against your tax bill. Deductions are like getting something on sale, a credit is like a coupon!

Single or married people who don’t itemize will potentially see a benefit because their standard deduction is increasing by more than their personal exemption(s). This includes people who are low income.

What real people are saying (or thinking):

I’m worried about how this will affect me and my family.

I don’t really understand taxes. What will this mean to me, really? 

Will my Social Security, Medicare or Medicaid benefits get cut?

I feel like my life is in someone else’s control.

This isn’t fair!

It’s the same old, same old: The Rich Get Richer.

I’m not saying anyone is wrong for thinking or saying these things.

What I’m saying:

  • A tax bill does not rule my life, nor does it rule yours. Yes, we have to follow the law, but that doesn’t mean our ability to make decisions goes away.
  • Get informed, get professional advice, and move on with your life!
  • If you want to give to charity, give to charity. If you can reduce your tax bill in the process that’s a bonus, but it’s not the driving reason for generosity. If you really want to focus on how you can reduce your income or estate taxes by giving to charity, you’re probably in a higher tax bracket which means you probably have a higher level of income and/or wealth and that means you can probably make a large donation and  benefit from itemizing your charitable deductions.

To the thoughts listed above, I offer the following responses:

I’m worried/scared how this will affect me and my family.

Understandable. Allow yourself just five minutes per day to worry and then move on. Worry is addictive, be careful.

I don’t understand taxes. What will this mean to me, really?

Sit down with a professional CPA. Buy some time with someone who knows what they’re talking about, who can look at your unique situation and explain it to you clearly. I know some of the best CPAs, smart and funny; let me know if you need a referral.

Will my Social Security, Medicare or Medicaid benefits get cut?

Probably not today or tomorrow but, potentially, yes. Start to look at your cash flow (income and expenses) and take control over those areas you can control, get creative finding solutions to your needs. This will require your time, energy and attention but it’s a good investment of all three.

I feel like my life is in someone else’s control.

Don’t fall for it. All civilizations have required some form of taxes. All citizens complain about taxes. There are many ways to get involved, make changes, or make peace with yourself. Determine what would make you feel more in control of at least your finances.

This isn’t fair!

That may be true. Fair is very subjective.

It’s the same old, same old: The rich get richer.

Probably. If you’re “rich,” hooray for you! If you’re not “rich,” you can still have a good life.

If you want to think of something besides the new tax bill, head on over to my Facebook page and watch a video of baby goats.

Be well,
Amy Jo

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Budgeting for Art

I smiled at this Tweet from Pope Francis:

May artists spread the beauty of the faith and proclaim the grandeur of God’s creation and His boundless love for all.

The “I HATE Budgeting (But I Like Having Money)” support group met to discuss budgeting for collecting art. It’s the first time in the six years we’ve run the group that we covered this topic, it was clearly overdue!

As the child of an artist, I have a somewhat biased opinion on the matter.
As a financial planner and budgeting guru, I feel that it’s my duty to give people permission to have beautiful things in their lives.

The wonderful Karen Eckert lead our discussion. A high school English teacher, she shared that most of her artistic purchases were made at TJ Maxx  (not that we’re knocking TJ Maxx) and simply were selected to match her sofa.

Imagine her anxiety when her date (AJ Fries, a professional artist)
invited her to attend an art opening.
What should she wear?
What should she say?
What should she do?

The date must’ve gone okay because not only did she eventually marry him, the two of them created Collect Art Now,  a way for people to start their own art collection by commissioning their favorite artists on the site to make a small piece for them. Ingenious! Karen’s advice, “Don’t fear art.”

Be it a painting, like one of the lovelies by Heidi Zanelli, (I know one of my readers will especially appreciate this),

a piece of jewelry (perhaps by the amazing jewelry designer Sarah Blackman ),

a poem (such as those written by Page Nolker about serving as a caregiver to her Mother who suffered from dementia)

a photograph (like this flower bud one by Gail Denny or the Gallagher Beach pier by Tom Burns’),

a pillow (like this from Back of the Moon Watercolors,

an illustration (this is by Sydney Hafner who explains, “The splatters on the Luna Moth print represent a population map. The gray represents the historic range of the moth and the yellow represents its range. This allows you to get a sense of what once was and what is its current population. If you were to overlay a map of the United States you could see where more exactly they have vanished from and where they may still be found.”),

a hand painted teapot by MacKenzie Childs,

or any form of art (including music and dance), our participants explained that art:

  • has a narrative, an emotional connection,
  • it serves as an escape; it can take us away from other thoughts or cares and, ironically, at the same time,
  • allows us to be present, in the moment, in this moment.

An investment in something that could help you both ESCAPE and BE FULLY HERE is unique indeed. What could I possibly compare it to? Certainly not an index fund!

How is art priced?
Art is priced using a unique combination of subjectivity and market forces: how much does the artist believe it’s worth and how much will a customer pay? And while some people may bristle at the price of some art work (abstracts in particular), bear in mind that most artists needed training, which someone had to pay for, they may work on a piece for hours, days, weeks, even months and require the necessities of life just like the rest of us. They needn’t starve to be artists.

Karen shared that, once an artist sells a piece at a certain price point (be it $15 or $500,000), s/he prices all other pieces accordingly (aka, not less than) because the artist wants her/his customers to feel that they made a good (read: appreciating) investment.

And yet one of my all-time favorite songs is Tom Paxton’s Talking Pop Art:

What would the world be like without artists?

What would your world be without art?

If there’s one thing I know for sure about effective budgeting is that there has to be money for enjoyment.  If there isn’t, you risk becoming resentful, and resenetful budgeters will not thrive.

One of our group members purchases art regularly, partially to provide financial support to artists. She’s kind of a modern Medici; the art patron next door.

The best way to support artists is to visit their studios first and foremost, festivals and shows second. When you visit their studios you get an opportunity to talk with the artists (remember, “Don’t fear art!” – or artists!) and learn about their inspiration, their methods, their passion. Simply ask them about these aspects of their work.

WNYers may enjoy a  wonderful weekend specifically designed for this called “Routes to Art” organized by the Cattaragus County Arts Council). I bought my very first painting on one of these open studio tours. It’s by Nance Jackson, it’s titled “Skeleton Leaf” and I love it. Between you and me, she should’ve charged me more.

At festivals, while you’re browsing, if you like an artist’s work, tell them. It can get kind of lonely, you know. And if you can reasonably afford to purchase some of their work, do so! If you can’t afford a purchase at that point, take the artist’s card and contact her/him when you can.

If you don’t care for their work, at least smile and thank the artist for being there, hauling their stuff out and sharing it with the public. It takes a lot of guts (and tarp, and patience) to do a show.

One of our regulars in the group explained that she saves up a little money each month in preparation for the Elmwood Festival of the Arts so that she has financial permission to purchase items that bring her joy.
Another has a special account at her credit union titled, “DREAMS.” I bet that makes saving money more enjoyable!

Maybe, instead of setting aside money for specific categories of your life, you may thrive by simply saving as much as you possibly can …and living on the rest. Then, if an opportunity presents itself, when time stands still as you gaze upon a piece of artwork, you can confidently say, “I’ll take it!”

When you start to collect art, you’ll have to be mindful of protecting, storing and even insuring pieces. Karen suggests videotaping your items and getting appraisals.

I hope you enjoyed this visually enhanced post, I certainly enjoyed creating it. If you need more than just a blog post to get your financial peace on, http://www.lauberfinancialplanning.com.

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