“In business, you don’t get what you deserve,
you get what you negotiate.”
~ Chester L. Karras

I recently wrote an article about a holistic concept of net worth and in the book, Women’s Worth: Finding Your Financial Confidence, author and certified financial planner Eleanor Blayney devotes a complete [excellent] chapter on ‘human capital.” She states: “…our most valuable asset…is our ability to turn our intelligence, education, skills, and experience into income through work.” She goes on to point out that significant wealth is seldom the result of investments in stocks, bonds, and other traditional assets. Rather, our human capital is the path to wealth building.

Blayney shares an illuminating worksheet that calculates the lifetime value of YOUR earnings and shows how things such as asking for a raise, leaving the work force for three years to parent full-time, or getting retraining impacts the value of human capital over time.

She asserts that “the value of your earnings are every bit as important to grow and manage as your investment accounts.” One way to do this to this is to obtain and sustain a competitive standing in the job market. Blayney shares, “Studies have shown, for example, that a college education can increase lifetime earnings by as much as $1 million.”

However vital keeping yourself re-tooled is, it is trumped by an even more important piece of the equation: “asking for more.” Blayney points out that this is something that men are MUCH more comfortable with. The current wage gap means women earn 77 cents for every dollar earned by men in the same job. This may not seem like much, but to put it in perspective, for female college graduates this will result $1.2 million dollars less in earnings over their working life then their male counterparts!

So far, this is my favorite sentence in the book–and may even be one of the most powerful statements I’ve read my whole life:

“I can state with certainty that the investment of time and money spent on improving [negotiation] skills can make women wealthy in a way that simply becoming savvier about investing cannot.”

I hope this is music to some of your ears, because I know how much you ladies dread comprehending your financial portfolios. Now, I’m in no way saying ignore learning about your investments, but it seems to me that there is something super efficient about using negotiation skills to uplevel one’s income. Blayney attests that it is the biggest bang-for-your-buck ROI. AND, negotiating skills can be leveraged in every area of our lives, not simply in our boss’s or client’s office. Think about how beneficial those skills could be in getting your partner to take out the garbage or accompanying you to that chick flick you’re dying to see!

So, ladies, be on the lookout for more information about developing successful negotiation skills because I’m seeing how important this is to rocking your money mojo–and we are going to be on it!

YOUR ACTION STEPS TO FINANCIAL SMITTEN-HOOD:

I’d like you to pull out your Money Journal and write about your response to this article. What images, words, feelings come to mind when you think about “asking for more” and/or negotiating? These are not typically feminine qualities, so I imagine there may be some conflict arising. I’d love to hear your thoughts about this, especially regarding the gender piece. Please share them with me in the comments section below!

I’ve started reading Eleanor Blayneys’ “Women’s Worth: Finding Your Financial Confidence” for August’s Virtual Book Salon and am loving what she has to share. As a Certified Financial Planner who focuses on women’s financial issues and struggles, I’m finding that her book speaks to me. One of the points she makes early on is that is important for us to ‘know our numbers.” She parallels our physical health to our financial health. Most of us know our blood pressure, our cholesterol levels, our weight, etc. Yet, how many of us have stepped on the ‘credit score scale’ or know our net worth, our tax liability, the total of our monthly fixed expenses? Watch Eleanor talk about the importance of knowing our numbers in this short video:

I’m thrilled and honored to announce a special three-part series of blog posts by my colleague Terrence Shuman, an expert in compulsive spending and founder of The Shumlan Center for Compulsive Theft & Spending. Today’s post defines and explains some of the roots of compulsive shopping. In his next two posts, Terrence will suggest a number of helpful resources and places to get support for compulsive shopping, and share an inspiring story of recovery during the work with one of his clients.

For those of you who’d ‘rather be shopping,’ a passing thought might arise, “Is this really a problem?” Or perhaps your shopping behaviors are concerning to you or to others in your life. So what really signifies a problem? Humorously coined in the media, a “shopaholic” may also be referred to as a “compulsive shopper,” a “compulsive spender,” an “overshopper” or “overspender,” or a “compulsive buyer.” When we are referring to a shopaholic in the serious sense of the word, we are talking about a person—male or female—who uses shopping as a drug and who is no different from any other “addict.” So, like any addict, most shopaholics eventually cross a line and show the following tell-tale signs of an addiction or compulsion:

1. a progression of shopping which leads to more and more time spent shopping or more and more money spent shopping
2. a sense of being out of control with shopping or an inability to set limits and stick to them
3. preoccupation or obsession or agitation when one goes for certain periods of time without shopping
4. lying, hiding, concealing or deceitful behavior—hiding purchases, opening up secret accounts, lying about whereabouts, etc
5. negative consequences associated with shopping including loss of time, loss of money (debt), loss of relationships, difficulty managing one’s life
6. others express concern about the person’s shopping
7. items bought are often unused or hoarded
8. continuing to shop/spend, lie or hide shopping or spending, despite negative consequences and/or confrontation

People overshop for different reasons, and perhaps even different reasons at different times. Here are some sub-categories of shopaholics:

Compulsive shoppers—primarily shop when strong or difficult emotions arise
Trophy Shoppers—have to have the best of everything but more for one’s own satisfaction than to impress others
Image Shoppers—have to look the best of have the best in order to feel good about oneself and, usually, to fit in or impress others
Bargain Shoppers—have to get the deal, the steal in order to feel satisfied or victorious
Codependent Shoppers—tend to shop more for others than themselves, try to buy love/friendship, don’t feel worthy unless giving
Bulimic Shoppers—buy and return, buy and return: get a rush and fill-up and then feel sick/remorseful and purge by returning; cycles continues
Collector Shoppers—obsessed with accumulating sets of things or rare things for value or sense of order/completion/control

There are a number of emotional/psychological reasons people become shopaholics, often traced to childhood experiences. Oftentimes there is a history of severe material and/or emotional deprivation when they were young or, conversely, extreme overindulgence or spoiling. The top ten reasons people struggle with overshopping are:

Grief and Loss/Loneliness (To Fill a Void)
Anger (To Make Life Fair/To Get Back at Someone)
Depression (To Get a Lift)
Anxiety/Stress (To Soothe/Escape/Comfort)
Acceptance/Competition (To Fit In or Belong/Keep up with The Joneses)
Power/Control (To Counteract Feeling of Powerlessness)
Boredom/Excitement (To Live on the Edge)
Shame/Low Self-esteem (To Make Oneself Feel Better)
Entitlement/Reward (To Compensate for Suffering or Sacrifice)
Rebellion/Initiation (To Break into One’s Own Identity/Search for Self/Distinguish/Define)

Terrence Shulman, JD, LMSW, ACSW, CAAC, CPC, is founder of The Shulman Center for Compulsive Theft & Spending and a sought-after expert in this field. In addition to providing counseling services and training other professionals, he has appeared widely in the media including Oprah, Prime Time, and 48 Hours. He is the author of “Bought Out and $pent! Recovery from Compulsive $hopping and $pending.” For more information and to contact Terrence directly, visit The Shulman Center website.

The Women’s Institute for Financial Education, WIFE.org is the oldest non-profit organization dedicated to providing financial education to women in their quest for financial independence. Their website provides information on everything from investing to taxes, as well as resources specifically for women dealing with divorce [including workshops nationwide] or widowhood. Visit wife.org and if you like what you find, I encourage you to sign up for their newsletter. It always contains something of interest to expand your financial knowledge base.

“If you believe in social security, you believe in the tooth fairy.”
~Terry Savage

I had the pleasure of hearing personal finance expert Terry Savage speak recently at a Women’s Leadership Conference I attended. She is a registered investment advisor and has the admirable accomplishment of being a founding member of–and first female trader on–the Chicago Board Options Exchange. In addition to writing a column for the Chicago Sun-Times, her book, The New Savage Number: How Much Money Do You Really Need To Retire?, has just been published.

The talk she gave was at a women’s conference, so understandably her speech was geared to a female audience. And not surprisingly, she focused on the necessity of women investing for their future retirement. She shared a number of statistics, charts, and graphs showing the changing demographics of society and what this will mean for all of our financial futures. A champion of female financial empowerment, she declared: “There are going to be a lot of little old ladies around. Who’s going to take care of us if we don’t?”

Retirement planning is often based on “averages,” which is problematic because as Savage notes, “real life is never average.” One of the “averages” that is hard to predict is knowing how long we will live, and therefore how many years post-retirement we will need to fund. To assist with this limitation, Savage suggests visiting www.livingto100.com. There, you can take a quiz that asks you questions about your eating and exercising habits, your family’s health history, and even if you floss your teeth every day. Based on your responses it will calculate your individual life expectancy. You then have a better-informed ‘guesstimate’ to start with.

Savage also recommends using a range of variables to predict a diversity of possible outcomes based on different scenarios. Having surveyed the myriad retirement calculators available, she recommends the Ballpark E$timate available [for no fee] at www.ChooseToSave.org. It’s an easy-to-use, two-page worksheet that helps you quickly identify approximately how much you need to save to fund a comfortable retirement.

I encourage you to visit Terry’s website, www.TerrySavage.com, where she has a ton of great information and resources. If you register on the site, she will email you a free Personal Financial Organizer. It’s a comprehensive snapshot of all of your current financial data such as account numbers and location of important documents. Complete it and keep it in a safe place, letting someone else know where it is in case of an emergency.

To hear financial wisdom straight from Terry Savage herself, check out this clip:

Terry Savage: How Much Do I Need to Retire?