What’s More Important Than a Pair of Jeans and Black Boots?

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Last week I had a great excuse for hiding out in bed with a huge stack of my favorite financial publications for an entire day; I had a nasty head cold.  I fully realize that I am a bit of a nerdy introvert, and this is not what thrills most people about a “sick” day, but I ended the day feeling refreshed and wiser, albeit a bit stuffier.  The fact that I get to share with you the best bits of information I read is what excites me about writing the financial woman blog!

Spending this time also allowed me to focus on improving my own financial plan without the distractions of running a business (or two), family issues or other commitments.  (Does anyone really want you to carry out their volunteer duties if they are going to cough all over everyone?)  And to be honest, I really needed to spend time focusing on new ideas and strategies for my own personal investments, something that we all need to make time to do.

As the writer of a financial education blog, I am constantly asking myself what I need to share with my readers.  What information have I learned in three decades of investing (successes and mistakes, where we learn the most!) that I can share with you to help you start reaching your financial goals now?

Several key concepts surfaced once again from this day of focusing solely on investing that I am reminded to share with Financial Woman readers.

1. The importance of understanding the use of benchmarks when you choose or monitor an investment product or financial advisor is crucial. Not utilizing this simple tool is akin to giving your children over to a total stranger without first checking references, and then not making sure they are alright.
2. Choosing the outcome you want from an investment is the first step in selecting that investment. The two choices are cash flow or capital appreciation, although some investments provide both. Unfortunately, investments can also provide capital depreciation, and negative cash flow, but tips for preventing that is best saved for another article.
3. Everyone in a high tax bracket should consider some form of investments that lower personal income taxes.  This is often in the form of alternative investments such as rental real estate, oil and gas partnerships, or small business ownership.
4. Working with a financial advisor doesn’t mean you are free from responsibility for your money, and knowing the basics of where and how your money is invested.  Also, the alternative investments mentioned in the third point are in an area that’s not likely to be addressed by a typical financial advisor. You are the orchestrator of your wealth.
5. Most people don’t realize that Treasury and other highly rated intermediate and longer term bonds are not as safe as they might seem because bond values go down when interest rates rise.
6. Expenses in the form of taxes and fees take a bite out of every investment.  Know what you are paying, and always look for ways to lower these two expenses so you can accumulate wealth.

These principles are as essential as a great pair of jeans and black boots.  Each of these topics is addressed in detail in my 7 Essential Steps You Must Take Now to Secure Your Financial Future course. It is a home study investment program that includes basic information that is truly essential for anyone who has any money to invest.  A few hours of your time, and $147, or less than the cost of a good winter coat, provides financial empowerment today.  And, unlike the coat, financial smarts will keep you warm for life, not just a few seasons.