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Women & Investing Seminar Short

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A seminar geared towards women & finance, but a good review for anyone.

A seminar geared towards women & finance, but a good review for anyone.

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Women & Investing Seminar  Short Women & Investing Seminar Short Presentation Transcript

  • Women and Investing Smart Women Finish Rich Presented by Lisa Marie Brugman CA Insurance License # 0C97144 Insurance Agent for Advisors Wealth Management, Inc. New York Life Insurance Registered Representative Owner, Financial Advisor for NYLIFE Securities, LLC. Rep/Agent # 084584 Securities offered through NYLIFE Securities, LLC. Member FinRA, SIPC Blue Coast Financial Advisor Independent Owner
  • Agenda:  Investment Basics  Why be in the Market  Smart Women Finish Rich
  • Investment Basics  Stocks  Bonds  Mutual Funds  Annuities
  • Stocks  Stocks are ownership  A Corporation issues stock  When an investor purchases stock, she becomes part owner of the corporation.  Stocks as an investment  An investor purchases a share of stock; the price of the share increases; the investor sells it. I.e. –You buy a share of Disney at $3 /share and then sell it for $8 /share; You made $5 /share.  This is Capital Appreciation; Buy low Sell high  An investor holds her shares; the Corporation declares a profit and distributes a portion to the share holders, (investors).  When profits are distributed by a corporation; it is called a dividend.
  • Bonds  Bonds are loans (or debt)  The government, its agencies, or municipalities can issue bonds.  Corporations can issue bonds.  If a corporation wants to raise capital, and it doesn’t want to issue more stock, it may make a bond offering.  A bond offering may be $1000 bond at a fixed rate, due in a set number of years. I.e. XYZ Co. -$1000, 6% due in 10 years -An investor purchases a bond for $1000; she will receive interest payments of 6% each year; in 10 years, the investor can cash in her bond for her $1000 investment.  The investors lets XYZ Co. “borrow” $1000 for a 10 year period. In return the investor will receive income of 6% a year during that time period.
  • Stocks & Bonds Why should you invest in stocks and bonds? Over the long run, stock and bond investments have out-paced inflation. In a portfolio, stocks provide growth and a hedge against inflation; bonds provide stability and income. An accurate assessment of your goals, needs, time frames, and risk tolerances are needed to develop the best investment strategy and create the right portfolio balance of stock and bond investments.
  • Other Investments: Mutual Funds A mutual fund is a pooling of investor dollars to purchase stocks, bonds, or both in a portfolio to meet a specified investment goal. An investor can invest a fixed amount each month; as little as $25 per month. MFs can help diversify your investment portfolio, - a typical fund holds an average of 125 companies1. Convenience Monthly or quarterly statements Automatic reinvestment There are over $7 trillion invested in the stock market through Mutual Funds2. 1Morningstar 2Investment Company Institute
  • Other Investments: Annuities Are an Insurance Company Product Fixed Annuities A contract between an annuitant (investor owner) and an insurance company for a specific rate of return on an investment made. This investment is guaranteed not to lose the investment. Variable Annuities A contract between an annuitant and an insurance company The investment can be made in fixed accounts or variable sub-accounts. A sub-account is a pooling of investor dollars to purchase stocks, bonds, or both in a portfolio to meet a specified investment goal. This investment in NOT guaranteed. The investments results depend on the performance of the sub-accounts.
  • Why “Smart Women Finish Rich ” TM Based on the Best selling book by David Bach, Broadway Books, 1999  How to Live Rich  How to Finish Rich
  • Agenda:  The Good News  The Not-So-Good News  The Seven Steps to Living and Finishing Rich
  • The Good News:  Women own 9.2 million businesses.  42% of households with assets greater than $600,000 are headed by women.  Women earn $1 trillion dollars a year.  Women have out performed male investors 9 out of the last 12 years Source: National Foundation of Women Business Owners, 1999. Commonwealth Business Review, March 1999. Bureau of Labor Statistics, 1995, National Association of Investors, 1996.
  • The Not-So-Good News:  Women live 7 years longer than men.  The average age of widowhood is 56.  25% of all widows go through their husband’s death benefits in 2 months.  One in two marriages end in divorce.  Women are out of the labor force an average of 11 ½ years for child rearing. Source: Business Week 01/00, Shelby White – What Every Woman Should Know about Her Husband’s Money, Investment Company Institute.
  • The Seven Steps to Living and Finishing Rich:  Step One: Learn to Earn. Step Two: Put your Money Where your Values are. Step Three: Figure out Where you stand Financially. Step Four: Build your Retirement Basket. Step Five: Use the Power of the “Starbucks” factor. Step Six: Build your Security Basket. Step Seven: Build your Dream Basket. Based on the Best selling book by David Bach, Broadway Books, 1999
  • Step One: Learn to Earn  Take a class  Learn one thing about money every day  Read two investment books this year Step Two: Put Your Money Where Your Values Are Example of Goals: Example of Values:  Tangible things or  Intangible desires. experiences. Has a price No price tag. tag. -i.e. making a difference -i.e. pay down debt; buy in your community; a house; travel freedom; security  Figure out what is important to you about money.  Why is it important?
  • Look at your Check Book. Are YOU Living Expensively or Living Rich Leased car Making a Difference New Clothes, monthly Helping Others Entertainment, weekly Don’t rush/ Have a Life Cell phone(s) Feeling calm/ Happy/ Satisfied Laundry service More time for Family Work to make more Money More time for Friends Never enough time Financial Freedom & Security  How can you change your current expense habits so that you can live Rich?
  • You must set Goals to help make your Values Real. They must be written down. Make them “SMAC”  S – Specific What are the details? How much will it cost? How much time will it take?  M- Measurable How will you measure progress? What check points will you set up?  A- Achievable Who will hold you accountable? Challenges? How will you overcome them?  C- Compatible Complete the “SMAC’ goals What does it help you accomplish? worksheet from the Appendix
  • Step Three: Figure out Where you Stand Financially  Do the “Find your Stuff” Worksheet  Do the Financial Inventory Worksheet Worksheets in the Appendix
  • Step Four: Build Your Retirement Basket What is the single most effective thing you can do to help yourself become a millionaire? PAY YOURSELF FIRST! How much should you save? Men should save - 10% Women should save - 12%
  • Building a Substantial Nest Egg How You Could Potentially Build $1,000,000 by age 65 (10% Annual Interest) Age Daily Savings Rate Yearly Savings 20 $4.00 $1,440 30 $11.00 $3,960 40 $30.00 $10,800 50 $95.00 $34,200 To reach your Nest Egg goal, you need to start saving… TODAY! Assuming continuation of a 10% hypothetical growth rate. Returns however, on all investment products will fluctuate. Investment return and principal value will fluctuate and your investment value may be more or less than the original invested amount. This hypothetical illustration is for informational purposes only and is not meant to forecast or imply the performance of any investment vehicle.
  • Remember: PAY YOURSELF FIRST! Where should you put your money?  Pre-tax retirement options:  401(k), 403(b), 501(c)  Self employed – Sep IRA, SIMPLE  Tax deductible IRA or after-tax ROTH IRA
  • The 401(k), 403(b), 501(c) plan Company/ Organization sponsored plan Contributions taken Pre-tax Often, employer will match your contribution to a max limit Use it to invest for growth. Avoid “Lazy Dollar Syndrome”
  • IRAs Self-employed have Sep IRAs  Contribution limit of 15% of taxable income  Max contribution of $30,000 per year Traditional IRAs  May be tax deductible, dependant on earned income  Grow tax deferred, taxable upon withdrawal  Mandatory distributions at age 70 ½ Roth IRAs  Contributed to with AFTER-tax dollars  Grow tax deferred, Tax-Free withdrawals  No mandatory withdrawal age
  • The Time Value of Money 3000000 2500000 Account Values 2000000 Age Investors 1500000 Janet Susan 1000000 500000 0 1 4 7 10 13 16 19 22 25 28 31 34 37 40 43 46 49 52 55 Age in Years Janet contributed $2000/ yr. from age 19 yrs to 26 yrs. Susan contributed $2000/ yr. from age 27 yrs to age 65. Assuming a consistent 10% hypothetical growth rate. Returns however, on all investment products will fluctuate. Investment return and principal value will fluctuate and your investment value may be more or less than the original invested amount. This hypothetical illustration is for informational purposes only and is not meant to forecast or imply the performance of any investment vehicle.
  • Step Five: The “Starbucks” Factor Double Nonfat Mocachino $3.50 Chocolate Biscotti $1.50 One Diet Coke $1.00 One Candy Bar $1.00 Total $7.00 $7.00 savings per day = $210 per month $210 per month = $2520 per year $2520 per year with a hypothetical 10% growth rate = $ 1,115,334 in 40 years! Assuming a consistent 10% hypothetical growth rate. Returns however, on all investment products will fluctuate. Investment return and principal value will fluctuate and your investment value may be more or less than the original invested amount. This hypothetical illustration is for informational purposes only and is not meant to forecast or imply the performance of any investment vehicle.
  • Step Six: Build your Security Basket Keep an Emergency Fund  4 – 6 months salary  in a liquid account  **Remember this is for emergencies Plan your Estate  Prepare a Will or Living Trust  Keep it up to date  Make sure beneficiaries are correct and current  Be sure your Family knows its location  Have it reviewed by an attorney periodically Make sure you’re Properly Insured  Health Insurance  Life Insurance  Disability and Long Term Care  Home owners Insurance
  • Step Seven: Build your Dream Basket How to get to your dream basket goal: Time Frame Investment Type Less than 2 years Money Market 2 – 5 years Bonds, Bond Fund 5 – 10 years Balanced, Stock Fund 10 + years Growth Stock Fund
  • Where do I get started? Talk to a professional  She can help you determine your future need your savings ability your risk tolerance  She can help you understand ALL your choices Money markets, annuities or mutual funds? Retirement plan, mid-term or short-term goal Insurance coverages Trusts and Estate Planning
  • Talk to a Professional! …Because Smart Women Finish Rich!
  • Talk to a Professional! Lisa Marie Brugman CA Insurance License # 0C97144 AdvisorLisa@gmail.com Advisors Wealth Management, Inc. PO Box 11285 Whittier, CA 90603 888-987-WEALTH (9325) Insurance Agent for New York Life Insurance Blue Coast Financial Advisor Registered Representative Independent Owner for NYLIFE Securities, LLC. Rep/Agent # 084584 Securities offered through NYLIFE Securities, LLC. Member FinRA, SIPC