money headache 

Money Smarts for the Real World

September 29, 2011

Keeping Up With the Times

Humans are creatures of habit.  Change, even good change can cause great discomfort.  The way change is viewed -- and reacted to -- can thwart or encourage success.  When kids are watching, there is the potential to affect how they will handle this pressure in the future.  The fact is that adaptability is key to survival.  It is easy to lament how things have changed for the worse; the jobs that have been exported overseas; and the opportunities that have thinned out.  Or, we can show the next generation what it means to "pull up by the bootstraps".  Unfortunately, without change, life can become stagnant, innovation disappears, personal and professional improvements cannot occur.   It may cause some shifting in the seat, but change is an opportunity to find a  better way, but only for those willing to adapt. 


Survival of the Fittest


As hard as we try to control our environment, the reality is that things are always changing; things that are beyond our control. Adaptability becomes the great separator between surviving well, getting by, and being destroyed. How we choose to move forward, and how well we anticipate and adjust to circumstances makes all the difference to the outcome. Those things we do control. Survival mode isn't a bad thing; it actually forces us to be more creative and look at our challenges with urgency (and perhaps, a fresh eye). Consider examining your worries and see what creative solutions you can come up with. Be an active participant in your life, and don't wait for the ceiling to come crashing in before acting. Anticipate well and make your move before you need to, in order to strengthen your chances for success. Here are some actions you can take now:


Increase Job Security.  One of the greatest fears in a weak job market is being laid-off.  In addition, there are jobs that are being exported overseas.  Worrying and complaining about this won't change the situation.  Take this time to formulate a Plan B, and be wise to the writing on the wall.  If your job (or your spouse's job) is always dangling by a thread, it's time to look at the skills acquired and the contacts made.  Can this experience translate to another industry? For example, an unemployed teacher might pursue a career as a corporate trainer, which requires the ability to communicate and instruct.


Consider freelance or consulting opportunities available (provided your employer doesn't forbid this).  Would an investment in more education or training improve your job prospects?  Is there a side business that can be started with little or no capital (ideally, that would allow you to keep your full-time job)?  Maybe you have been itching for a change and want to explore a passion. Or, maybe you see a need that isn't being filled in the market right now. Again, use the experience and skills you already have to turn this into something profitable. Brain storm, and write down everything you can think of, no matter how far-fetched it may seem.  You may end up with a clear idea of where you should be personally and professionally. 


Tap Resources. Local colleges and universities and libraries have education and job placement counseling. There are small business development centers that offer free mentoring to start-ups, including assistance with fleshing out your idea, developing a business plan, marketing and management issues. Career Zone and Job Zone can help you match your talents with prospective careers.  There are resources for retired/mature workers looking to transition back into the workforce. Women and veterans have agencies dedicated to working with their needs.  The Small Business Administration, SCORE, and the US General Services Administration are some websites to explore. 

Click here to read more.

broken bank  

Finding Financial Strength:

What Does the Downgrade of U.S. Debt Really Mean?


Sentimental observations about the United States falling from a 94-year state of grace aside, Standard & Poor's recent downgrade of the Treasury's credit rating has real implications for investors and the nation.

In theory, a lower credit rating reflects a higher risk that an entity such as the Treasury will default on its debt or other financial obligations. To compensate lenders for the added risk, lower-rated borrowers generally need to offer higher interest rates. However, even though Standard & Poor's now considers U.S. debt no longer worthy of the top AAA rating, Treasury yields-the gauge of how much interest credit markets demand from the U.S. government-actually declined during the week following the downgrade. Although it may seem paradoxical, global investors still consider Treasury debt the safest place on earth to park their money in times of heightened risk, no matter what the rating agencies say. No foreign central bank is dumping our bonds; if anything, they're buying more.

In the longer run, if the Treasury fails to regain its AAA status, its reputation could eventually weaken, and U.S. interest rates may rise. On the eve of the downgrade, the two countries with AA+ ratings from S&P paid an average of 2.72% on their two-year bonds and 4.58% on their 10-year debt, compared with 1.12% and 2.65%, respectively, for the world's remaining AAA borrowers. 

Click here to read more. 







$mart Question

Does it make sense to pay off debt, even if the rates are low, like 7%?


Relative to what you can earn in a safe place (e.g., CD, money market, or bank account), 7% is high.  Whenever you pay down debt, it is as if you have made that percentage on your money.  I don't know where you can possibly earn a 7% risk-free return.  If that is the only debt you are carrying,  your emergency fund is fully funded (6 months to 1 year of income saved), and insurance issues are fully covered, I would not hesitate to pay down the debt.     

In This Issue
Survival of the Fittest
Finding Financial Strength
$mart Question
$mart Move
 $mart Move:  Kid's Play 


There is a lot to be said for learning through play.  If you are looking for a way to introduce money concepts to your kids, don't ignore the tried and true games of years gone by.  Board games like Monopoly, The Game of Life, Pay Day and Careers all are fun ways to show children that their choices have an impact on their future well-being.  Planning ahead and strategic thinking wins the game and is a recipe for real-life success, too.  The best part?  No lecturing or eyeball rolling  required. 


































Quick Links
Have an Event?
Real$martica, Inc. is available to hold workshops for PTAs, local organizations, schools, and other groups and associations.  Topics include basic personal finance (handling money, using a budget, credit issues, and saving) to more complex issues such as buying versus renting; investing for retirement; managing the college selection, funding and financial aid processes; and estate issues.  Real$martica is also available for one-on-one consultations.   Contact us for more information.
Contact Us

Thank you for subscribing to our newsletter.  We hope you found it informative.  Our mission is to provide you with timely information that you can put to use.  We want to address your needs and hope you will provide us with your questions, comments, and feedback so we can make this publication and our website a meaningful resource for you and your family.   

Dina Isola, President

Find us on FacebookFollow us on TwitterReal$martica, Inc. on LinkedIn


Save up to $120 
Does your child have what it takes to get into the college of his or her choice?  How much aid can you reasonably expect to get from the school?  Call today to schedule an appointment for a detailed analysis of up to four universities and receive $50 off an initial session, or $120 off two sessions when paid in advance.  
Offer Expires: November 30, 2011