Smart Women Finish Rich, Canadian Edition: 9 Steps to Creating a Rich Future (Canadian Edition)

Introduction

WHY SMART WOMEN ARE TAKING CONTROL OF THEIR FINANCIAL FUTURES

I’ll never forget the moment I asked my mom, "What really makes the world go round – money or love?" I was only about five at the time. She looked me straight in the eyes and said, "David, love is what makes life special, but without money you are in deep trouble!"

Actually, "deep trouble" are my words. What my mom really said can’t be repeated. I had never heard my mom use an "adult" swear word before, so even at age five I knew then and there that not having money could be really painful. The obvious next question that came to my five-year-old mind was, "Are we rich, Mom?" That question took a little longer for her to answer (I think she eventually made me go play with my toys), but the thought of money has stayed with me ever since. If not having money is so bad, why don’t more people figure out how to get and keep it? It can’t be that hard. Or can it?

More than 25 years later, I’m privileged to make my living teaching thousands of people – mostly women – how to invest and manage their money. And I’m happy to report that, when you strip away all the baloney, learning how to handle your own finances turns out to be relatively easy. Indeed, through my Smart Women Finish Rich seminars, I’ve already helped hundreds of thousands of women travel the same road to financial independence as you are going to take in this book. They have learned – as you will – the three keys to smart money management that enable a woman to gain control over her own financial destiny and, yes, finish rich:

· How to use both your head and your heart in making financial decisions.
· How what I call "the Latté Factor" can transform even the most modest wage earner into a significant investor.
· How my "three-basket" approach to financial planning can assure you not only long-term security but the ability to realize your lifelong dreams.

As you will discover, my approach to personal money management involves some powerful and exciting techniques. And all of them are pretty easy to master. Before we get started, however, it might be a good idea for me to address a question that often comes up at this point – namely . . .

WHO AM I TO HELP YOU FINISH RICH?

One way to answer this question is to tell you that prior to founding FinishRich, Inc., for nearly a decade I was a Senior Vice President and financial advisor for a major New York Stock Exchange firm and a partner in The Bach Group, which managed during my tenure over half a billion dollars for individual investors. Most of my hundreds of clients are women who have come to me after attending one of my investment seminars or through referrals from other women.

But what you probably really want to know is why a man (and yes, I admit it – I can’t hide the fact that I am a man) is so driven to teach and empower women to take control of their finances. Well, the answer has mainly to do with my grandmother. Her name was Rose Bach, and she was unlike any other grandmother I ever met.

My Grandma, the Investor

The head buyer for wigs at Gimbel’s (back when Gimbel’s was one of America’s leading department stores), Grandma Bach was a working woman at a time when most women weren’t. Now, my grandparents were never wealthy; in fact, they never even owned their own home. Nonetheless, my grandmother decided at a very early age that she wanted to be an investor. Acting on her own, she took her earnings and put as much as she could afford into stocks and bonds. Over time, and without any advice from her husband, she built up a high-quality portfolio. When she passed away recently, at the age of 86, her investments were worth close to $1 million–this from a woman whose first job paid only $10 a week!

There were many things my Grandma Bach taught me, but for our purposes, there’s one lesson that deserves to be singled out:

You don’t have to be rich to be an investor!

Of course, by becoming an investor, if you do it wisely like my Grandma Bach, you will almost certainly get rich!

It was Grandma Bach who helped me make my first stock purchase. I was seven years old, and my favourite restaurant in the world was McDonald’s. So whenever I spent time with my grandmother, she would take me there for lunch. One day, at her prompting, instead of asking for ketchup for my fries when I marched up to the counter, I looked at the woman on the other side and asked, "Is this company public?"

The counter lady looked back at me as if I were nuts, then called over the manager. Yes, he told me, McDonald’s was a publicly traded company. After a little persuasion from Grandma Bach (and a lot of vacuuming and dishwashing), I saved my allowance for three months and managed to accumulate enough money to buy three shares of McDonald’s Inc.

That was over 25 years ago. Since then McDonald’s stock has gone up in value and split so many times that those original three shares of mine have multiplied into close to 200 shares. If I’d had enough money to purchase 100 shares of the company back then (an investment of around $10,000 at the time), my McDonald’s holdings would today be worth close to $500,000! (I often give my parents a hard time for not having lent me the additional money.) And all I had done was go out to lunch with my grandmother when I was a little kid and put my allowance into a company whose hamburgers I liked.