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Lauren’s blog covers topics that impact your finances, your family, and your future. Is there a topic you’d like Lauren to tackle? We’d love your suggestions and feedback.

What will you be celebrating this time next year? It’s all about your focus

What will you be celebrating this time next year? It’s all about your focus

“Whatever you pay attention to will grow more important in your life.” It’s a Deepak Chopra quote that is apropos this time of year. It applies to everything from houseplants (which I definitely do not give the attention they need!), to relationships, to money. As you look back on 2018, what did you pay attention to? What grew more important in your life—and what took a back seat? Is that balance where you want it to be as you move into the year ahead?

I was chatting with a friend recently and, as I sometimes do, I said something that was a bit self-deprecating. I was mad at myself for not doing something “right”—at least in my own mind. My friend just smiled at me and said, “Don’t worry about it. You could have done it better if you’d chosen to. You just weren’t paying attention.” Her wisdom struck me to the core! How right she was. Had I been focused, I certainly would not have messed up! It was an insightful lesson for life and for things both large and small. It got me thinking…

What aspects of my life do I truly want to pay attention to? Am I focused on them the way I should be so that they will, as Deepak Chopra says, grow more important in my life?

I made my list. I wrote down the relationships I want to foster in the coming year, the physical goals I want to accomplish (my blog post Grandparenting…and striving to age in happiness and health offers insight into that line item!), the business goals I want to achieve, and yes, my financial goals too. I already feel empowered and charged up for 2019, and I have a pretty good picture of what I will be celebrating on New Year's Eve 2020.

If you’re inspired to make your list (and, oh, I hope you are!), be sure your financial goals make the cut—and be mindful of choosing the things that matter most.

I grew up with depression-era parents. As a result, my father was hyper-focused on what was happening with his investments. Every morning, his first task of the day was to open the paper, review the stock chart, and write down yesterday’s closing prices of his holdings so he could track what was up and what was down. Based on that information, he decided what to buy and what to sell, and he was always on edge about what might happen tomorrow.

In today’s world, checking the ‘stock market’ is easier and faster—and that’s not necessarily a good thing. Just this Monday, on December 24, stock indexes tumbled into bear market territory. As I write today, the day after markets closed for the Christmas holiday, it looks like we’re in a slight rebound. It can feel almost irresistable to pay attention to the daily ups and downs, especially when the market is dropping. But does that movement have any real impact on your financial security? If you have a solid financial and investment plan in place, it shouldn’t. Your investment plan is built to sustain ‘normal’ market cycles, including the impending bear market. Unlike my father whose only ‘plan’ was his self-constructed portfolio, if your plan includes a diversified mix of asset types and classes based on your goals, your time horizon, and your financial foundation (which I trust it does!), there’s no need to pay attention to temporary shifts in the market. (I have one client who tells me that when the market is down, she doesn’t even open her quarterly statements. Smart woman!)

Instead, try paying attention to the things that really can impact your financial security. If you’re in debt, create a plan to wipe it out by this time next year and create financial freedom. (Read my blog post Declare your financial freedom to learn how.) If you’ve been a bit Scrooge-like in the past, explore ways to embrace your generosity. If your spending feels out of control, examine what is really enough for you and change your habits to fit your needs. If you lack financial confidence, take the reins by creating a comprehensive financial plan and a solid, manageable budget (as always, we’re here to help!). If you have a singular goal, adopt a laser focus and tackle it—now.

A few years ago, I did just that. While mathematically, the return in the market beats paying down a low-interest mortgage, I knew that I would feel more secure at an (ahem) certain age if I didn’t have a house payment. So I laser-focused my attention on paying off my mortgage, and a few months ago I finally paid off my home, free and clear. At long last, I am really a homeowner, and it feels just as good I as I imagined it would! (As a reward, I treated myself to a business class ticket on my flight to visit my family for the holidays.)

Of course, everyone’s values and goals are different. It’s all about focusing on what will make you happier and more confident in the future. By paying close attention to that, whatever it may be, you can build a better, stronger path toward your goals—and have something truly meaningful to celebrate next New Year’s Eve. Cheers to that, and cheers to a happy, healthy, and financially confident 2019!

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My holiday gift to you: My favorite book discoveries of 2018!

My holiday gift to you: My favorite book discoveries of 2018!

I’ve been a long-time member of a wonderful havurah, a friendship group of great men and women who have become like family to me. One of my favorite traditions we enjoy together is our Hanukkah gift exchange. Recently we realized that unless we opted for a white elephant exchange, we were simply trading Starbucks gift cards. Not much fun at all! So we took a new approach and decided to use the opportunity to share our favorite books from the year. What a great idea it turned out to be! I was excited to contribute the first two books in what I consider to be one of the best new mystery series out there: Louise Penny’s Chief Inspector Gamache Series. (I hope whoever received them enjoys the series as much as I do!) And I’m looking forward to diving into the novel I received, which is something I may never have picked up myself.

In that same spirit of literary giving, here’s my holiday gift to you: a little vacation reading list of my favorite books of the year. I hope there’s a little something for everyone.

  • Louise Penny’s Kingdom of the Blind
    If you aren’t one of the lucky ones who has already discovered Louise Penny, I highly recommend starting at the beginning of this captivating series with Still Life. It’s the best way to begin to explore Penny’s Three Pines, a land that I can’t help but equate to Peter Pan’s Neverland (you can’t find it on any chart, only in your heart)! From her start as a broadcast journalist, Penny began writing novels with the avid encouragement of her husband. To date, she’s written 13 books in the series, delivering a little more than one each year since 2008. Even if you’re not a mystery lover, I expect you’ll love this Canadian town and its world of characters where Francophiles and Anglophiles collide and murders occur at a wild frequency. It’s one of my all-time favorites!
     
  • Prisoners of Geography
    Looking for a fantastic non-fiction read? Whether you love geography, history, politics, or all three, this is a must-read. Using 10 maps, author Tim Marshall shows us how geography serves as the foundation upon which nations are won—and lost. His narratives gave me a whole new perspective on the world from a vantage point that is surprisingly logical. (Who knew that the strength of the US may have more to do with our location on the world map—oceans on the east and west, waterways throughout, and weaker nations to the north and south—than almost any other factor? Fascinating!) Its relevance to what’s happening in our world today is astonishing.
     
  • Outlander
    I confess that I had avoided this one for quite a while. After all, it brings together two of my least favorite genres: fantasy and historical fiction. But when so many people whom I like and respect continued to tell me that Outlander is their absolute top pick of all time, I finally had to give in. Boy, am I glad I did! Not only have I learned the meaning of the word ‘Jacobite,’ but I’ve also come to see that fantasy and historical fiction could be a passion of mine after all. If you’re like me, take the time to dive into the novel before you’re tempted to take the shortcut and watch the TV series; the writing paints a perfect picture of these intriguing characters and their fantastical adventures.
     
  • The Browns of California: A Family Dynasty that Transformed a State and Shaped a Nation
    Even if you’re not as happy as I am to have ‘Governor Moonbeam’ in California’s highest seat, I recommend checking out this vivid history of the Golden State’s political dynasty. Author Miriam Pawel is a Pulitzer Prize-winning editor and reporter who spent 25 years at Newsday and the Los Angeles Times, and her skill is crystal clear in this compelling chronicle of four generations of the Browns. It’s a particularly powerful read at a time when Jerry Brown is about to step out of public life after decades of service during which he has played a vital role transforming policies on education, the environment, and so much more. Brown may not be perfect (who is), but this is an eminently readable look at the “real” Browns of California.
     
  • How to Think About Money
    Of course, it wouldn’t it be right for me to sign off without including at least one book on money, and Jonathan Clements’ very readable and light read truly deserves to be included on anyone’s list of great reads. His approach has been called “financial feng shui,” and I agree completely. Clements shares “how to think about money” in five simple steps that each highlight that the ultimate goal of money is to give you the choice to do exactly what you want to do. As Clements writes in his introduction, “Growing wealthy is embarrassingly simple: We save as much as we reasonably can, take on debt cautiously, limit our exposure to major financial risks, and try not to be too clever with our investing.” What a great way to kick off the season of New Year's resolutions! (And if you want the CliffsNotes version, check out my blog posts covering the first three steps: Money really can buy happiness, How long do you plan to live (and are you planning for it?), and Ready to be a successful investor? It’s time to rewire your brain.)

Happy reading, and happy holidays! If you want to share your own favorites, let’s connect on Goodreads. I hope to see you there!

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Ageism, sexism, and staying relevant after 50

Ageism, sexism, and staying relevant after 50

Ageism is everywhere and is the most “normalized” of any prejudice. No matter how experienced you may be or how ideal for a job, once you hit 50, the possibility of being forced to leave your job long before you choose is all too real. And if you do find yourself out work, trying to find a new position can be a maddening process. For women of a certain age, ageism is exacerbated when a good dose of sexism is added to the equation. After striving—and succeeding—at building an ideal career, being marginalized and told that you’re no longer relevant may seem absurd, but in many industries, it’s a bitter reality that can put a serious dent in your sense of self-worth and your financial security.

My own story is just one example. After building a successful career in finance, my corporate job was eliminated. It was a brutal awakening that the path I had been paving for myself for years had ended. When I looked at things from the perspective of my employer, I had to admit that I got it. I realized that if my son Adam and I were being considered for the same job, I could see why they’d prefer hiring him instead of me. He had a hot-off-the-press economics degree. He had no family responsibilities (yet). He could tell better jokes and was a perfect candidate for the after-work sports team. Me? I had one thing going for me: I was great at my job. But in that environment the perception of potential trumped performance.

Like many in the same situation, I soon realized that finding a new position where I could do a similar job at equal pay was not going to be easy. Every employer out there was looking for an Adam—not a me. So I did what I had to: I learned to hustle. I learned how to do payroll. And taxes. And QuickBooks. I worked one day a week as a controller for a manufacturer, and two running someone’s tax office. I got certified as a CFP®. I became an Enrolled Agent. I found my passion for wealth management, and the rest is history. Yes, I persisted.

But as I said, my story is just one of many examples. At just 52, Liz has been searching for a new position for nearly a year after being laid off from the firm where she’d built a very successful career as an organizational leader. Whether it’s because of her age, her sex, or both, no one has offered her the type of role for which she’s qualified. At a time when she should be rapidly accumulating assets to fund her retirement, her financial reality is a significant setback. At 67, Nora would love to be working more, but she can’t seem to add clients to her roster. At 70, Delia is healthy, fit, and extremely accomplished, but she’s burned out after searching long and hard for a job that fits her skills and experience.

What’s most difficult for every one of these women is that each had planned to continue to work into her seventies. However, staying relevant and marketable is much easier said than done—especially for women. According to the AARP, while 72% of women between the ages of 45 and 74 think people face age discrimination at work, that was true for only 57% of men in the same age range. Is it fair? No way. But the only way toeliminate this brutal combination of ageism and sexism is to change the perception that women over 50 are declining or are any less valuable to the workforce than younger workers—both male and female.

The good news is that there are many older women who are actively proving that they aremore than capable of making highly valuable contributions in their fields. At age 72, Andrea Mitchell continues to be an active and important voice in journalism. The bona fide “Queen of Media,” Oprah Winfrey has been ranked as the most influential woman in the world. At 64, she’s showing no signs of giving up her crown. Meryl Streep and Elizabeth Warren are 69. Martha Stewart is 77. Nancy Pelosi is 78. All of these women continue to show us all just how relevant—and powerful—women of a certain age can be.

My favorite example (of course) is Ruth Bader Ginsberg. At 85 years old, RBG is known for her tenacity in a career dominated by men. When she broke three ribs earlier this month, she was back at work before she was even released from the hospital. Her commitment and ambition seem to know no bounds. But what about those of us who are not household names and are struggling to remain relevant? Here are three ways to stay in the game—and keep your bank account flush—no matter what your age:

  1. Own your ambition.
    Don’t buy into the old idea that it’s not “feminine” to be ambitious. (Whatever that’s even supposed to mean!) Take a lesson from RBG: a married Jewish mother, she began crashing through glass ceilings at 17 and hasn’t stopped since. Figure out what motivates you, set your goal, and go for it. No excuses.

  2. Acquire skills people pay for. 
    Whether you’re striving to maintain relevancy in your current job or trying to make a change, identify what skills you can add to the list of things you’re great at. Are you a born coach? Is accounting your thing? Could you be a great organizer or a business writer? Explore what sparks your interest and then find a way to improve your marketable skills and excel in your new field of choice.

     
  3. Keep hustling.
    Working into your seventies at a corporation may have been part of your master plan, but many older workers soon realize that the traditional path is no longer realistic. If that’s true for you, it’s time to jump into the “gig economy.” To see what types of services are in demand today, take a look at the listings on sites like Upwork, Guru, and Fivrr. To learn more about how to keep working in the new world of work, read my blog post Rethinking retirement in the “gig economy.” Don’t stop hustling until you choose to stop working on your own terms.

 

According to the American Institute for Economic Research, 82% of respondents to a recent survey said that they successfully transitioned to a new career after age 45. While some took pay cuts early on, about half saw an increase in earnings after “a period of hard work and persistence.” It can be done. As my friend Bobbie says, “ageism plus sexism equals sageism.” I love that! Embrace the sage in yourself and show the world just how relevant you are—at any age.

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Lunch & Learn Recap: Spotlight on Identity Theft

Lunch & Learn Recap: Spotlight on Identity Theft

Rarely a week goes by when we don’t hear about a new data breach or a friend or acquaintance having their identity stolen. While it may seem like a new problem, it’s not. Identity theft has been around for decades. However, today, our increasingly digital lives leave us more vulnerable to this issue than ever before. As cybercriminals become more and more sophisticated, the way to defend yourself and your valuable data assets is to get smart about Internet security and identity theft.

Toward that goal, we welcomed a great group of clients to a wonderful Lunch & Learn session at Paul Martin’s Grill last week. Joining us was my friend Dan Skiles, who is currently the president of Shareholders Service Group. Dan generously shared his insights into why protecting your identity matters, as well as some important steps to help reduce your online risk.

My concern about identity theft comes both from my role as every client’s financial gatekeeper and from my first-hand experience with the issue more than a decade ago.

I remember it all too vividly: I had just walked in the door from work when my phone rang. On the other end of the line was a Nordstrom rep inquiring about my unpaid bill. The first words out of my mouth were, “Of course I’ve paid my bill. I always pay my bill!” While my head was still spinning wondering what had gone wrong, the rep was already going the extra mile by checking my credit report. (You gotta love Nordstrom service!) The news wasn’t good: In recent weeks, “I” had opened multiple new lines of credit, including two new credit cards and a loan application. I was shocked that it had been so easy for someone to access my identity, my credit and, in essence, my money.

Immediately, I began the process of reporting the fraud and trying to reclaim my credit identity, but even more damage had been done. That was made crystal clear when a process server showed up at my office and handed me an eviction notice for my house in Del Mar. The issue: I didn’t own a house in Del Mar—then or ever.

In those days, long before nearly every aspect of our lives had become digital, it was most common that victims of identity theft had close contact with the thief. A relative or someone else who had been in the victim’s home was able to gain access to private information and use it to their advantage. Today, that information is no longer stored in private files or a safe deposit box. Now our most private information is stored online with banks, credit card companies, and mortgage lenders. It’s even for sale! There is actually a black market for personal data where criminals can buy all the information they need to steal your identity—just $1,200 for your full identity, $30 for your social security number, and $11 for your date of birth. Even worse, many people unwittingly give away their information for free by clicking on spam emails, logging in to crossword puzzles and games, or accepting ‘free’ online offers.

The best things in life may be free, but not one of them is offered for free online! Knowing that fact is just a first step in making your information hard to get—which should be your first goal when it comes to protecting yourself from the threat of identity theft. Here are a few of the other steps that Dan recommended during our Lunch & Learn:

  • Create secure passwords.  Don’t use the same passwords for different accounts, and don’t be honest about your security questions! (How many people know where you went to high school or what kind of car you drive?) Have a system that makes sense to you (and only you) and create unique passwords that are illogical and hard to guess. Even better, use an app like LastPass that generates complex passwords, stores them for you, and simplifies access from every device.
     
  • Use Multi-factor Authentication (MFA).  If an online app (Facebook, Twitter) or your bank offers MFA, use it! When you log in, the app will take another step to verify your identity. Answer a security question (that you’ve deliberately made tricky). Receive a text with a confirmation code. Do whatever it takes to help online services confirm that you are, in fact, you.
     
  • Stop clicking on phishing emails!  Phishing emails have one goal: to gain fraudulent access to your personal information directly from you. They may include offers (yes, lots of ‘free’ stuff), ‘urgent’ messages from the IRS or your bank, or even a vague note from a friend telling you to watch their new favorite video. Don’t do it. The IRS will never contact you via email (or phone for that matter), and the only thing you risk missing out on is, perhaps, the cutest cat photo ever. Instead, resist temptation, and keep your passwords, your Apple ID, and your credit card information to yourself. If you're concerned that your bank or credit card company really does need to reach you, call them and ask. And, of course, install reputable anti-virus software on your computer and keep it up to date at all times.
     
  • Remove your personal data from the web.  Start by stopping companies like Facebook, Google, and online stores from tracking you to collect personal data. Review each company’s privacy statement and follow the guidelines to keep your data private. If you need help, consider using a service like Abine’s Delete Me that combs the web to delete data and minimize your online footprint.

The sooner you take control of your digital identity, the better. Cybercriminals are already able to hack into servers that we expect to be secure. Equifax, Yahoo, and Target are just a few of the biggest hacks in recent years. New technologies like 5G, advanced biometrics, artificial intelligence, and quantum encryption and communication should all help keep your information more secure in the future. But until then, rather than getting paranoid and living off the grid, get smart. Start with Dan’s simple steps, stay informed about changes in identity protection, and stop clicking on things. Just stop. Cybercriminals are smart, but by getting smart about identity theft, you can be sure your data—and your assets—are safe for decades to come.


Want to learn more?   This email address is being protected from spambots. You need JavaScript enabled to view it.  to request a copy of our Lunch & Learn presentation, ‘Spotlight on Identity Theft—Protecting your personal information: Why it matters and the 4 steps to success.’ As always, we’re here to help!

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Aging parents? 3 steps to pave a smoother financial path forward

Aging parents? 3 steps to pave a smoother financial path forward

Anna is amazing. At 94 years old, she is still incredibly energetic and remains larger than life in every way. Yes, she needs a bit of help getting out of bed in the morning, but from her perspective, that’s her only limitation. As she’s told me time after time, “My mind is still ticking away perfectly!” She firmly believes her cognition is faultless, and because she is fiercely independent, she’s kept her children completely removed from her finances.

A few years ago, Anna sold a piece of real estate and put all of the cash in her checking account. She still has plenty of cash remaining—enough to pay full-time, agency caregivers for another five to seven years. However, because her children are out of the loop, they have no idea how much savings she has or how soon her assets will run out. They worry that she’ll outlive her savings, even though Anna is set, literally, for life.

As a financial advisor, I see situations like these all the time. Anna’s situation is a simple one, but not all seniors—or their families—are as fortunate. It’s a fact that aging affects financial decision-making, even if that decline is not obvious to family members. That makes creating a long-term plan that includes some basic checks and balances, as well as a pre-determined timeline for transitioning financial responsibility from the parents to the adult child, one of the most important pieces of a smart financial plan.

If you have aging parents (or if you’re the aging parent yourself!), take these three steps as soon as possible to avoid costly mistakes in the years to come. Your future self will thank you!

  1. Start talking.
    In many families, money can be an emotional topic, and just as it can be difficult for many seniors to understand why they need to hand over the car keys when driving becomes unsafe, handing over control of their finances can also become quite the challenge. Ease the way with a family meeting. Have an open, honest discussion about how much money is available to pay for your parents’ care and who is the most suitable person to manage the assets when they are no longer capable of making prudent financial decisions. Decide together when and how to hand over the financial reins.  

    If you need help, consider hiring a mediator—a trusted financial advisor, family therapist, or mediation specialist. With the help of an impartial third party, everyone involved is more likely to remain open-minded and, hopefully, walk away with confidence in the plan and greater peace of mind. I also recommend sharing my blog post To protect your financial future, hand over the keys to your kingdom today with your parents to initiate the conversation. Hopefully, it will open the door to a more comfortable conversation.

     
  2. Create a system of checks and balances.
    As your parents age, they will inevitably need more and more assistance, and a system of checks and balances can help avoid a crisis. According to a 2016 report from the National Institute on Aging, trouble managing money is one of the earliest signs of Alzheimer’s disease and other age-related dementias. The deficit often becomes clear when the checkbook suddenly doesn’t balance because bills are paid twice, when every charity (not a select few) receives a check, or when a caregiver has too much influence.

    At our firm, we ask every client to sign an incapacity agreement when they turn 65. We ask, “What would we see you do that would be out of character so you would want us to intervene?” The answers range from making sudden changes to their financial plan, to gifting large amounts of money, to becoming secretive about their assets. The agreement allows us to call the person they name in the contract (perhaps you) when we see one or more of these triggers. By having this conversation long before any decline is anticipated, we’re able to ease the transition from financial independence to asking for help.

     
  3. Establish joint control of your parents’ accounts.
    We typically recommend establishing a revocable living trust, appointing the most responsible and available child as co-trustee, and opening a bank account in the name of the trust with multiple signers: the parents and the co-trustee. Another option is to name the adult child as an authorized signer (not a joint owner) on the parents’ account. Many of our clients’ families use our powerful eMoney Personal Financial Portal to oversee their parents’ financial transactions and balances and collaborate with us as financial planners.

Even without signature authority, Mom and Dad can give you visibility into their accounts using an “interested party statement” or giving you online access to their accounts so you can help manage the finances even from a distance. Both of these options are safer than opening a joint account, which can put your parents’ assets at risk. If your parents are not well enough to participate in financial decisions, that’s when it’s time to trigger the previously established power of attorney for their financial matters.

For any child, taking control of your parents’ assets can feel like you’re overstepping an invisible line in the sand. Suddenly your old roles are reversed, and you’re the one holding the purse strings. Yet making that transition can be an important stress reliever for everyone involved. If you don’t know where to begin, talk to us. We’re happy to help guide you through this delicate transition to create a smoother path toward a sound financial future—for the whole family.

 

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All written content on this site is for information purposes only. Opinions expressed herein are solely those of Lauren S. Klein, President, Klein Financial Advisors, Inc. Material presented is believed to be from reliable sources and we make no representations as to its accuracy or completeness. Read More >