Dear Readers: In nearly two decades, I don't know that I've ever had such an exciting workweek. So I wanted to share.
On Monday, I launched a daily radio show for Oprah and Friends, a brand new XM channel (you can find it at XM 156). My show will be about helping you make the most of your money. As if that weren't exciting enough, yesterday my new book, "Make Money, Not Excuses" (Crown Business) hit stores. This one is specifically for women because I think women are at a turning point as far as our money is concerned. We have always been the primary spender in the family. But these days we are more likely to be an equal — if not greater — breadwinner.
Unfortunately, a lifetime of reasons, excuses, roadblocks — whatever you want to call them — are standing in our way. For some women, that roadblock is an aversion to numbers or math, a feeling we're chronically disorganized or time-starved, the perception that managing the money is something our husbands want to do (or, just as often, feel they should do) or a feeling we're too old, too single, too incompetent to really step up to the plate.
Research has shown that because more women are remaining single longer, more are divorcing, more are living to ripe old ages, 95 percent of us will be alone financially at some point in our lives. The reason I wrote this book is because I know — from personal experience — that it's far better to know how to manage your money before you have to do it, rather than learning it under stress and on the fly.
In the book, I explore from a psychological vantage point why a particular excuse is getting in your way. Where did it come from? How can you get rid of it? And then I show you in the simplest possible terms how to conquer it, make some real money, and move onto the next.
What follows is a very condensed version of Chapter 8, which is devoted to helping women who feel they can deal with their money but for whom investing is daunting, or worse. I hope it helps:
By not investing, you rob yourself of a huge shot at getting rich. You have to allow your money to work just as hard as you do if you're ever going to be able to reach your goals, retire, and feel financially secure.
Investing can be easy. I'll show you how to simplify the process with an investing plan that runs on automatic pilot. You'll only need to check the controls no more than four times a year. And if you follow my advice, you'll sleep well each night, secure in the knowledge that you haven't taken any crazy risks and that your money is doing the very best it can for you. But first you need to knock down the obstacles to investing — there are four big ones — standing in your way.
Why don't you invest? There are four reasons:
1. Investing bores you. For some women, the mere words "Wall Street" elicit a big yawn. Sixty percent of all women say they want to spend as little time as possible managing their investments.
2. Numbers make your eyes glaze over. If you can't get past the basic math, it's very difficult to get yourself to make even the simple decisions, such as how much of your money you want to invest and what percentage of your income it should be. (If I'm talking directly to you, there's a whole chapter in the book devoted to math anxiety.)
3. You don't speak the language. I spent a few years working on Wall Street and I remember initially feeling like I was in a foreign country. The terminology — p/e ratio, basis point, Excel — swam in one ear and out the other, and I would reach for the bottle of Advil long before the day came to an end. A huge number of women — 47 percent — feel that way.
4. You're scared. When you come right down to it, you're afraid if you invest your money, you'll lose your money. That's why so many of you keep your money where it's "safe" in the bank. Losing money is no fun. But even if you've been burned in the past, you have to realize that investing losses are like any other losses. You have to grieve them and move forward. That means determining what you need to do to have a better experience in the future.
You are probably wondering: Why do you have to learn this language, to cross the math hurdles, stomach the boredom and get over your fears? Because if you don't then the only money you will have over your lifetime is money that you earn from working. Moreover, if you don't invest, then your money actually loses value over time. When you do nothing with your money, taxes and inflation devalue your dollars, so they are worth less tomorrow (and the tomorrow after that) then they are today.
Take yourself (and your emotions) out of the rebalancing process. The truth is the vast majority of investors never do it anyway. Thankfully, in the last few years, mutual fund companies have rolled out "life cycle funds" and "target date retirement funds." These ask you what year you're planning to retire. As you approach that date, the fund company shrinks the percentage the fund has in stocks and boosts the percentage it has in bonds to reduce your risk over time. This way, if the stock market tanks a year or so before you're set to retire, you should still be OK.
How OK? Really OK. Consider the following scenario. What if you could find just $10 a day to invest. That's $70 a week. It's the price of dinner for two in a moderate restaurant. The price of one pair of pants at Banana Republic. But when you put that money to work and it earns an average 8 percent annually (if you look back to the Great Depression, the markets have exceeded that by several percentage points), and when you shelter it in an account like an IRA or a 401(k) where you don't have to pay taxes until retirement, it can grow to be a bundle.
Jean Chatzky is an editor-at-large at Money magazine and serves as AOL's official Money Coach. She is the personal finance editor for NBC's "Today Show" and is also a columnist for Life magazine. She is the author of four books, including "Pay It Down! From Debt to Wealth on $10 a Day" (Portfolio, 2004). To find out more, visit her Web site, .