Jean Chatzky's Road Map to Wealth

The wealth expert says anyone can prosper, even in tough times.

Sandra Bienkowski

Jean Chatzky was a fact-checker and reporter for Forbes when she got a job offer from startupSmartMoney. She was at a crossroads. Her job at well-established Forbes was difficult to land, and she was doing well. At SmartMoney, she’d have to prove herself, and there were no guarantees. But she could do what she loved—write all the time, not fact-check for others. And telling stories about people and money was her passion.

Although a parade of people came into her office telling her not to do it, she listened to her heart and made the move. Today, as the financial advisor to millions, she thinks it’s the best career move she ever made.

Chatzky, 46, believes listening to her intuition and following her passion created opportunities and opened her mind to entrepreneurial pursuits. Now, she’s an award-winning journalist, author of seven books, financial editor of NBC’s Today show, contributing editor for More magazine, columnist for The New York Daily News and host of a daily show on Oprah Radio.

With 20 years of personal-finance experience, her philosophy is simple. “If you want to own your own life, you have to own your money,” Chatzky says. “That means, earn a decent living, spend less than you make, invest the money you don’t spend, and protect everything you have built.” She believes by taking charge of your finances, you will take charge of your life. But, like many people, she learned the hard way. “I came around to helping people manage their money as I learned about managing my own.” Early on, Chatzky spent more than she made. She blew her first opportunity for a 401(k) because she didn’t understand how it was supposed to work.

She would eventually use her first-hand knowledge to help people tackle “an epidemic with a devastating impact—overwhelming debt,” Chatzky says. “I think my skill is being able to communicate complicated information in an uncomplicated way without dumbing it down.”

Managing Your Money

She offers practical advice on how to dig out of debt and build wealth in her books, including New York Times Best-Sellers Money 911: Your Most Pressing Money Questions Answered, Your Money Emergencies Solved and Pay It Down!: From Debt to Wealth on $10 a Day.

“People are living paycheck to paycheck because they are not bothering to pay attention to what they have coming in and how much they have going out and where it is going,” Chatzky says. “It’s a lack of discipline.”

Reducing debt is essential to being in control of your money, Chatzky says. She believes everyone can find an extra $10 a day in their budgets to reduce debt, and she offers numerous ways to do it—from little decisions like skipping the popcorn at a movie to bigger ones like refinancing your car loan. She provides actionable steps for people who “need to go on a debt diet,” such as tracking spending, using a debit card as your plastic of choice, using only one credit card for emergencies, sticking to a shopping list, paying bills as they come in, managing your credit score, and visiting the ATM only once a week and dividing that cash by seven so you only carry a set amount each day of the week.

“I truly believe that we all, if we take a little more time, have the ability to be good managers of our money. It doesn’t mean we are all going to be out there day trading or buying complicated hedge funds,” Chatzky says. “There’s no magic to this; people need good habits.”

For her 2009 book, The Difference: How Anyone Can Prosper in Even the Toughest Times, Chatzky studied the habits and traits of the wealthy. She discovered that people who build wealth “tend to be more passionate about what they do. They are visionaries—able to see things in an improved way, if not a new way altogether,” she says. “They are goal setters who take risks, listen to their intuition and are always on a quest to learn something new.”

Adopting a Prosperity Mindset

Wealthy people also have three behaviors in common: “the discipline of habitual savings, investing and always having a plan,” she says. “Want to buy a house? Plan. Want to send a kid to college? Plan. Decide and plan what you are going to do, instead of defaulting into it. People who do plan, actually get where they are going.”

Other traits of the wealthy she found in her research are happiness, optimism and resilience. While happiness is about today, optimism is about having a positive outlook, and the wealthy have it. “With a positive outlook, people are more likely to pick themselves back up in tough times. Optimism is closely tied to resilience, and resilient people focus on the things they have control over.”

In other words, Chatzky says, “focus on yourself—not other people—and let other things go.” And if you aren’t a naturally resilient person, she says research shows it’s a skill you can learn by identifying what you can control, taking action to solve a problem instead of ignoring it, and emphasizing the positive.

While the wealthy are happy, they aren’t too happy. “On a happiness scale of one to 10, you want to be about an eight,” Chatzky says. “Mildly happy people are strivers, interested in making the kind of changes to get ahead. But people who are too blissed out don’t do the very important basic financial measures to take care of themselves. They don’t have emergency cushions because they don’t think there’s ever going to be an emergency.”

Taking control of your finances is about knowing when your behavior isn’t working, Chatzky says. “Changing behavior is hard and you have to be ready. If you are not quite there yet, it will help you to get ready so when you do finally pull the trigger, you will be successful.”

Adapted from Success Magazine....

Your friend Ramon Sosa

No Such Thing as Failure

Help your teen understand failure

is a steppingstone to success.

by DAVID LEE

Anyone who ever did anything truly great failed first. Failure is part of trying.

It's going to happen. What matter is how you deal with it.

Thomas Edison failed thousand of time before he created the incandescent light bulb. Abraham Lincoln was defeated in several government elections before becoming one of the most revered U.S. presidents in history. When Michael Jordan was cut from his high-school basketball team as a sophomore, he went home, locked himself in his room and cried. He became arguably the greatest basketball player of all time.

Failure doesn't have to be the end. If you let it, failure can be an effective and powerful teacher that ultimately leads to success.

many teens today don't understand this. Passing or failing a test, making the team or getting cut, being accepted socially or being ridiculed--teenage life can be confusing and full of pressure, and, sadly, teenagers think it's easier not to try at all than to face their fear of failure.

But if teens don't try or take chances, great opportunities for success will pass them by. And having an attitude of avoidance and a fear of risk-taking can ultimately lead teenagers to give up on themselves altogether.

A March 2010 report on the national high-school dropout rate published by Civic Enterprise shows that nearly one-third of all public-high-school students, and almost half of minority students, fail to graduate with their class. The report details the ever-increasing

"downward spiral of failure, from boredom in the classroom and occasionally skipping class, to long absences from school, engaging in risky behaviors and becoming part of a subculture that thinks it is cool to drop out."

Teens who do graduate high school face important decisions that will affect the rest of their lives. It's an important time for them to know how o properly approach and handle failure. They may be about to experience a lot of it.

How does your teen handle failure? Do you talk to your teen about how he or she can turn failure into success?

Eighteen-year-old Mark Stumer learned that failure can be a great teacher. He and his friends decided to sell candy and soda in the cafeteria at their school as part of a class assignment.

"We were doing steady business, pilling in between $200 and $300 a week," Mark says. But soon, Mark and his friends began to experience trouble they didn't foresee. "We hadn't put much thought into how we would use our profits," he says. "We decided that we would spend a portion of our profits to pay our senior dues. And if we made enough of a profit, each of us would receive small amount of cash. However, arguments about paying senior dues and how to split the extra money became constant issues."

Finally fed up with all the arguing and stress, Mark and his friends closed the store. Although the store didn't succeed, Mark says that he and his friends learned a lot of valuable lessons, such as how to work together as a team and how to use spreed-sheets and databases, and how important those skills are in running a business. Overall, they got an idea of what types of skills they'd need to develop to be successful in the future. But they wouldn't have learned any of that had they not taken the risk to run a business that eventually failed.

We are going to experience failure, but no experience in life is wasted if you learn something from it. Make sure your teen knows that failure is just a steppingstone to success.

Adapted from the book SUCCESS for Teens. For more information and to order the book, go to www.successfoundation.org (this book is FREE for Non-profit Organizations) ..

Your friend .. Ramon Sosa.