Manage Your Financial Life

Nancy Doyle

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Nancy Doyle, CFA, is an author, speaker, and advocate for financial literacy. She has thirty years of experience in wealth management, investments, corporate finance, and consulting. She is a graduate of Georgetown University and received an MBA from University of Michigan’s Ross School of Business.

Fundamental Concepts

Educate Yourself

These fundamental concepts will provide a foundation for understanding investments, markets, and investment strategies. Supply and Demand The value of an item depends not on what you paid for it, but on what someone else would be willing to pay for it today. What someone is willing to pay is related to supply and demand. For example, if there is a fixed supply of something, and the demand for it increases, then the price will increase. If demand for something remains constant, and there is an increase in supply, the price will decrease. Yield, Total Return, and Compounding For any asset, yield is the income earned (interest or dividends) divided by the price of the asset, such as a bond or a share of stock. Price and yield move in opposite directions. If a $100 bond earns 5 percent interest, it earns $5 on a $100 asset, or $5 divided…

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Read the Wall Street Journal

Educate Yourself

A woman in my community received an MBA from the same school that I attended. She graduated with distinction thirty years before me, one of only six women in her class. (My business school class was 25% women.) She has had a successful career and has made a point of advising younger women to read the front page of the Wall Street Journal every day. It is important to keep up with national and world events, but also to be informed about the most important business and financial news of the day.

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How to Underwrite Yourself

Analyze Finances

Underwriting is what banks or insurance companies do when they evaluate risks associated with lending money or providing an insurance policy. To underwrite yourself, you need to take a close and honest look at your finances, ask yourself some questions, consider uncertainties and exposures, and evaluate your risk profile on many fronts. Analyze Your Sources of Income The first consideration is your income. Ask yourself these questions: Is your salary steady or variable? Do you rely on commissions or bonuses? Do you work in a cyclical industry? If your compensation is variable, you should not carry a lot of debt. Likewise, you should make sure to have an ample cash reserve. Evaluate Your Debt When you are thinking of buying a big item, consider if you can actually afford the item, not just whether or not you can afford the payment. Commit to paying off your credit card balances every…

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Personal Financial Statements

Analyze Finances

Evaluate your personal financial statements to gauge your financial health. When evaluating the financial health of a company, bankers and investors rely on three types of financial statements: An income statement, which incorporates income and expenses for a period of time A balance sheet, which shows net worth at a point in time A cash flow statement, which considers not only your household income, but also changes in savings and debt I’ll show you how to create each of them below. Income Statement:  Income – Expenses = Net Income How to create an income statement Add up your salary or other income Start with your after-tax take-home pay. Add any other sources of income from consulting or part-time work and rental or investment income (all on an after-tax basis). Add your partner’s after-tax take-home pay as well as any other sources of income. Subtract your expenses or obligations The main…

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Spring Cleaning

Get Organized

To manage your financial life better, start with a financial spring-cleaning. Just like when you go through your closet to determine what to keep and what to donate, you need to do the same with your financial life. Get ready A few things before you get started. Designate a room or an area of a room for your work. For online files, keep a log of what you have sorted through. Set out the key office supplies including:  a staple remover and stapler, sticky notes, pencils, paperclips and file folders. Bins for recycling Bags for documents that need to be shredded Gather your information Gather all documents and papers relating to financial, tax, legal, and health care matters, including things such as: Bank, financial, and credit card accounts Insurance Mortgage, car loans, student loans Tax returns Birth certificates, marriage certificates Wills, trusts, and powers of attorney All medical and school documents for…

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Get Organized

Get Organized

To ‘Get Organized’ is one of the four pillars in managing your financial life. The others are Analyze Your Finances, Educate Yourself About Investing, and Save and Invest. The following is a collection of posts that include important guidelines to follow. Please keep checking back as this list is constantly growing!

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Financial Jargon – You Asked…

Educate Yourself

Question: What does “sell in May and go away” mean? Answer: The stock market has not performed well sometimes during the summer months. Some have suggested that you should sell all of your stocks in May and buy them back after Labor Day. This is not a good idea, however. You should not try to time the stock market. Plus, you could generate capital gains.

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Analyze Finances

Analyze Finances

Analyze Your Finances is one of the four pillars in managing your financial life. The others are Get Organized, Educate Yourself About Investing, and Save and Invest. The following is a collection of posts that include important guidelines to follow. Please keep checking back as this list is constantly growing!

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Save and Invest

Save and Invest

Invest Your Money is one of the four pillars in managing your financial life.  The others are Get Organized, Analyze Finances, and Educate Yourself About Investing. The following is a collection of posts that include important guidelines to follow. Please keep checking back as this list is constantly growing!

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