Rick Kahler's Financial Awakenings

What a day!!  I am talking about Thursday, March 30th, which was the day the Wall Street Journal column broke quoting Ted and I.  First thing that morning, I received a call from a producer of NBC’s Today Show.  He wanted Ted and I to come on the show Saturday, April 1st, which was in less than 48 hours, with a couple, who was willing to talk about "Financial Infidelity."  The challenge, to find a couple willing to go on national TV about thier financial infidelity.

Financial Infidelity, where spouses spend secretly, was a term used by Jeff Zaslow in his column, "Moving On" where he quoted Ted and I on the subject.  Apparently, this term has resonated with the media.

Also on Thursday, ABC’s Good Morning America called and ABC’s Prime Time Live!  It was a blur of frenzied activity between Ted, Brad, myself, and various media people.  It wasn’t my normal day in the office!

When all the smoke cleared, we were able to find a couple willing to discuss their financial infidelity that the producers accepted.  That was the good news. 

The bad news was that I was ‘uninvited’ by the Today Show producers…so I was clearly disappointed.  But, Ted was invited and he will be on the show tomorrow morning, Saturday, April 1st.  And this is no April Fool’s! 

Of course, I am ecstatic that Ted will be on national TV promoting our work.  The producer told me they will mention our book, "The Financial Wisdom of Ebenezer Scrooge," where we write about the solution to curing financial infidelity, once and for all. 

It is wonderful the mainstream press is starting to recognize some of the components of integrated financial planning, although they don’t know it by that name yet!

LISTEN TO RICK’S COLUMN WEEKLY:  Download financial_independence.mp3

In last week’s column, I talked about defining retirement as doing what you want to do, when you want to do it, with the people you want to be with. When you define it that way, “retirement” becomes something you can begin to do long before you reach what we think of as retirement age.

As a follow-up to that idea, here’s a question for you. What would you be if you were financially independent?

Notice, I did not ask you what you would do or what you would buy, but what you would “be”. How would you spend your time? How would you like to like to “show up” in the world?

Would you choose to have a job? If so, what would that job be? Would you earn money (even though you didn’t need any money) or volunteer your time? Would you focus on being with your family or friends? How would that time you spend with them look?

You could spend your time being in the moment, just having fun. What does having fun look like to you? It might be anything: sleeping late, watching old movies on television, hiking, playing golf, traveling—the list is endless.

You might decide to change jobs. You might go back to school to work toward a career in a completely new field. You might get involved in local politics or volunteer at a charity you support. Maybe you’d spend time on hobbies you’ve always wanted to try or take classes in anything from fly-fishing to flying just because they interested you.

With your new wealth, you might hire someone to do basic chores like house cleaning or yard work, to free you to be what you really wanted. For example, perhaps hiring someone else to do tasks you don’t like would free you to spend more time being healthy and in good physical condition. You might find a personal trainer to help you develop a health and fitness routine.

You may want to be more spiritual, spending more time in study, meditation, prayer, involved in your church, or at spiritual retreats. Maybe you’d spend your time learning how to be a better spouse or a better friend. The range of choices is vast; think about what you’d put on your own list.

If you read last week’s column, you probably know what’s coming next. How might you incorporate some of those choices into your life now, even though you are not financially independent?

If you’re working at a job you dislike or one that doesn’t interest you any more, changing careers is certainly an option. People do it all the time. I’m not suggesting you go in tomorrow morning and tell your boss you’re quitting. But you can start working on a plan to make that career move in the next six months, year, or even five years.

If your wish list includes things like spending more time with family, volunteering, or running for city council, maybe it’s time to take a closer look at your priorities. Are they supported by the ways you spend your time now? Maybe you still belong to an organization that no longer interests you. Maybe you spend your weekends keeping up your house and yard to someone else’s standards. Consider what you might give up or get rid of instead of just squeezing more commitments into an already crowded schedule.

One of the biggest advantages of being financially independent is that it expands your choices. Consider turning that around. Start with expanding your choices, and you may just be able to live more richly and independently.

You would expect to see Rick Kahler and Ted Klontz to be quoted in the Wall Street Journal, the pioneers of integrated financial planning.  And, indeed they are quoted in today’s Journal.  But the real news is that Marcia, Rick’s wife, made it into Jeff Zaslow’s March 30th ‘Moving On’ column ‘Financial Infidelity:  When It’s Ok to Shop Behind Your Spouse’s Back’.

As it turned out, Jeff had called Ted and Rick for their comments on the secret spending of spouses.  When Rick told Marcia about the interview, she looked at him and said, "I have a money secret that I haven’t told you."  Rick was a bit stunned, and asked her to tell him more.  Marcia told him she had secretly been sending $30 a month to a girl in India.  Rick’s response was one of support and amusement that ‘secret spending’ of a good kind was going on in his own marriage.

When Rick thanked Mr. Zaslow for serving as a catalyst to ‘out’ a secret spending issue in his marriage, Jeff couldn’t resist….and that is what made it into the journal!  You can read all about it here if you have a WSJ online account.  I’ve put the article below for those of you who don’t.

Financial Infidelity: When It’s OK
To Shop Behind Your Spouse’s Back

Marital disharmony in America could be eased overnight by a little machine that would sit next to cash registers at every retailer. It would authorize not only your credit-card limit, but also your "spousal authorization amount."

That would be the maximum dollar figure you are permitted to spend without informing your spouse. Each couple would determine its own limits in advance, a giant bureaucratic agency would be informed, and countless money battles and divorces could be avoided.

That’s all wishful thinking, of course. Even if such a gadget were to be built, millions of couples would abhor it, because they’re addicted to surreptitious spending. Surveys show that up to half of all couples admit that they commit "financial infidelity" — lying to spouses about expenditures they’ve made. At the same time, financial and marital advisers say that a touch of secret purchasing can be healthy and liberating for a marriage.

Will an unauthorized purchase strum up marital discord? Above: The $5,999 Martin 000-ECHF Bellezza Nera guitar.

So how should couples develop a formula for their discretionary spending? In the corporate world, inventory managers use the term "open to buy," which refers to the amount available to spend. These days, a cottage industry of consultants is helping couples negotiate their own "open to buy" amounts.

Ted Klontz is president of Onsite Workshops, an organization near Nashville that helps people with financial issues. Last Friday, he visited a couple in their Tennessee home to help them sort out their spending patterns.

The husband is a high-earning music-industry veteran. His wife goes on frequent secret-spending sprees, dropping many thousands of dollars at a pop, usually on clothing. Reviewing their financial records, the couple had a realization: The wife’s buying usually followed incidences when the husband was unkind to her.

She was retaliating subconsciously, says Mr. Klontz. "Instead of saying, ‘Ouch, that hurt,’ she’d walk away feeling unloved, then buy things to feel better. This is extraordinarily common."

Complicating matters, the wife is beautiful and the husband likes her to look beautiful, says Mr. Klontz. "When she dresses nicely, he falls in love with her all over again. He reinforces the buying behavior." Mr. Klontz is helping this couple understand their dynamics.

When couples get married, they often resent losing their autonomy. A common refrain: "Why must I ask permission before I spend money? I’m not a child." Mary Hunt, founder of the DebtProofLiving.com advice Web site, tells spouses to give each other an "adult allowance" — money that can be spent however they want, without having to justify it. The amount is determined after reviewing all household expenses. For Ms. Hunt and her husband, the amount agreed upon is $200 a month.

Ms. Hunt advocates sharing credit reports before marriage, which can reveal a runaway spender. "It’s more important than a blood test. It’s a character reference." After marriage, couples should have "money dates," where they go through everything they’ve spent "except the allowance money," she says. They should do it in public places so they’re less likely to argue.

All this can be a challenge because our culture indulges extra-marital spending. Wine locker rooms now cater to collectors who don’t want their spouses to know how many expensive bottles they’ve purchased. Credit-card statements feature camouflaged business names to mask fees paid to porn or gambling Web sites. Store gift cards can be loaded up with stray cash, and even if your spouse snoops through your wallet, the card doesn’t indicate a value.

A lot of people find insidious ways to hide secret spending. Some use a check to buy groceries, write it for a larger amount, and get cash back from the supermarket. "They’ll use the difference to pay for a pedicure," says Ms. Hunt. "I call it ‘money laundering.’ " When the canceled check arrives, their spouses assume the full check went for groceries.

Ms. Hunt says she pulled such antics earlier in her marriage. She got a private post-office box so her husband wouldn’t see bills. She burned collection notices. She’d rip off tags, and put new outfits in her closet for a while, so she could swear that "they’re not new" if her husband asked. By 1982, she was $100,000 in debt. It took 13 years for her to get solvent. Her advice: If you’re deceitful, ask yourself, How would I feel if my spouse did this to me?

Mr. Klontz says that, years ago, he and his wife agreed that they could each spend $150 a month without informing each other. One day, in a music store, he saw an $800 guitar. He wanted it. He bought it.

He took it home and played it for his wife. She thought he sounded great, but then asked: "How much was it?" When he told her, she reminded him of their agreement.

"You’re right," he said. "I don’t deserve this. I’ll take it back."

"No, that’s OK," she replied. "You work hard. You do deserve it."

He kept the guitar, but has since realized that he was being passive-aggressive. Rather than focus on his violation of their agreement, he played the victim, and manipulated her.

Richard Kahler, a financial planner in Rapid City, S.D., runs workshops with Mr. Klontz. Mr. Kahler learned just this week that his wife, Marcia Welch-Kahler, has secretly been spending $30 a month without telling him. Since 2004, she’s been supporting a disadvantaged girl in India.

"I’ve wondered why I never told Rick about it," Ms. Welch-Kahler says. "I guess it just felt private. It’s something I did that was mine."

Mr. Kahler is philosophical about this. "Sometimes," he says, "a spouse really needs to have ‘me only’ money."

This is an important teleclass for all KFG clients to attend.  Learn how to use our new technology to exponentially increase the effectiveness of our services to you!  Rick will cover all the latest innovations with the KFG website and blog.  Our latest enhancements will change the way you interact with us, giving you quicker and more complete information than ever before.

Some of the things we will cover will be how to:

• Access your personal "KFG Client’s Only" section of the KFG website
• Quickly search for events, teleclasses and webinars of interest to you
• Access audio files and printed material of any KFG workshop or teleclass
• Use the webinar service so you can visually access a workshop or teleclass
• Search for items of interest on the blog
• Download forms, handouts, and other printed information and listen to instructions
• Find articles on topics of interest written by Rick

We have made it EASY to access our teleclasses, both by phone and computer!  If you can dial a telephone, you can join this teleclass.  If you can click on your mouse, you can join the visual portion!  So don’t let a sense of intimidation stop you from signing up!

The teleclass will be held April 6th at 4:00 pm MST.  Please call us or register on line in the Workshops, Teleclasses and Events section.  We will make sure you are sent an email with instructions on how to access the visual part of the presentation on your computer. 

CLICK HERE TO LISTEN TO RICK’S WEEKLY COLUMN: Download why_wait_for_retirement.mp3

When you think of the word “retirement,” what is the first thought that comes to mind?

Here are some typical responses to that question: To some, it means that you no longer work at a job you’ve tolerated or even hated. It is what you do after you gave the same company 20, 30, or even 40 years of service and then quit at age 65. It is that period in your life after you receive your gold watch and your pension, and you no longer work.

In my parents’ generation, retirement often meant the age at which you were forced to stop working whether you loved your job, were exceptional at it, or hated it. That age was usually 65, but for some professions it was (and still is for pilots) age 60. For others, retirement means “quitting” or doing nothing, patiently waiting for the end of life.

Some baby boomers will tell you that retirement is a non-event because they don’t ever plan to retire. That attitude is probably a good thing, based on the fact that the boomers haven’t saved for retirement any better than their parents did, and, unlike their parents, won’t be able to count on social security and Medicare to bail them out.

I have another definition of retirement. I define it as the period in your life when you get to do what you want to do, when you want to do it, with the people you want to be with. By that definition, I am retired, my kids are retired (and will probably come out of retirement at around age 14) and my wife is anxiously awaiting retirement (probably around the time the kids go to college).

So it probably makes sense to you that retirement is a word I am struggling to eliminate from my vocabulary. I say struggling, because for a financial planner, it’s a tough word to eliminate. We constantly refer to “retirement plans,” “retirement projections,” and “retirement age.”

In the place of retirement, I am attempting to use words like financial independence, authenticity, and integrity. If retirement means doing what I want, when I want, with whom I want, to me we are talking about a life that is lived authentically and in integrity. When my kids ask me what those two big words mean I tell them, “It is when your insides match your outsides.” Granted, that’s a bit simplistic, but easy enough for a five-year old and a nine-year-old to understand.

Age has nothing to do with having a job that gets you out of bed happily in the morning and leaves you wondering what part of it is work and what part is play. By that definition, it took me until age 50 to “retire.” Julie just “retired” at age 34, when she accepted a position with my firm as a junior financial planner. Dee, our company cook, is happily “retired” fixing gourmet meals for our clients. How do I know they are retired? It isn’t because they aren’t receiving paychecks. It is because both of them love what they are doing so much, it doesn’t feel like work to them.

If retirement means doing a job you love, then why not start making plans to “retire” as soon as possible? Think about what it would mean for you to do what you want, when and with whom you choose. Then start thinking about how you could incorporate more of that into the life you live now. When you define it this way, the idea of “retirement” becomes joyful and fulfilling. It can be a beginning rather than an end.

Listen to the interview of Ted Klontz and Rick Kahler with Gerri Detweiler,  consumer advocate, author, and host of "EverydayWealth."  To listen to the show, you can go to the archives of the program by clicking here.  Just look for the topic "Was Ebenezer Scrooge on to Something?" that aired on March 23, 2006.  It is on their website in two parts, Part I and Part II, and you will need to click on them separately to listen.

Here in Rapid City, we’ve spent the better part of the last two days digging out.  I can count five times in the last two days I’ve shoveled my drive and walks.  Since we’ve had 18 inches of snow at my house during that time, I’ve averaged shoveling every 3.6 inches. Overkill, maybe, but it was great exercise. 

Now put the 18 inches on top of the 12 inches we received last week, and that is around 30 inches in about 9 days.  We’ve had more snow in that 8 days than we had all last year!

Listen to Ted Klontz and Rick Kahler as they are interviewed by Gerri Detweiler, consumer advocate, author, and host of "EverydayWealth," this Thursday, March 23, 2006. The program starts at 1 pm, MST, and Rick and Ted will be on between 1:15 and 1:45.

You can listen in at www.EverydayWealthRadio.com. To listen live, be sure to click on “listen live.”

Each Thursday, Gerri answers consumer questions and interviews leading experts. This week’s first topic is "Credit Score Myths and Facts." Learn the biggest myths about increasing your credit score and how your FICO score can work for you with credit expert John Ulzheimer, Vice President of The After Bankruptcy Foundation.

The second topic is "Was Ebenezer Scrooge on to Something?" Join us as authors Richard Kahler, MS, CFP and Dr. Ted Klontz discuss their new book, The Financial Wisdom of Ebenezer Scrooge: 5 Principles to Transform Your Relationship with Money.” Old Scrooge may have been stingy, but he was savvy as well! Find out how self-defeating financial habits can be transformed into profitable solutions during this segment.

Call in live to ask your questions (1-877-474-3302 2-3 pm CST), or access recorded programs at a more convenient time by clicking on the red “audio archive” button.

Last week Ted Klontz and I had the privilge to meet with Michael Sutherland, Creative Director of Factual Entertainment for the BBC, and his associate Sarah McCarthy.  The purpose of the meeting was two-fold:  to further acquaint me with the program, "Millionaire’s Challenge," of which I am a consulting producer, and to introduce the BBC to our work in integrated financial planning.  The meetings were productive and only time will tell if there is an angle that the BBC will find to present our work to TV audiences.

Ted Klontz was in London to give a preview of his upcoming London workshop at the "Be The Change" convention in May.  Ted and I joked that if he didn’t show up, I could give his talk, since I have heard it more than a few times!

The evening of his talk, I arrived about four minutes early.  The organizer of the evening met me at the door and said, "Rick, Ted is hopelessly tied up in traffic and won’t be here for at least an hour.  Can you give a talk?"  So, with four minutes to go, I called Ted on his cell phone and got the "Cliff Notes" of his speech.  I spoke for an hour, and when Ted arrived he slipped in and continued.  Afterwards, participants said the presentation flowed so well, that had they not known better, they would have assumed the presentation was carefully scripted to have happened exactly as it did!

The March issue of Self magazine ran an article where my financial advice was prominently featured, along with Olivia Mellan.  I was interviewed for the article last summer by Valerie Frankel, who was doing a story on her reluctance to spend money on anything she considered a luxury.  She found me through the book I co-authored with Kathleen Fox, Conscious Finance. 

I spent about an hour on the phone with Valerie.  It was different from most, in that she was writing about her own money issues.  I actually took her through an exercise on how to identify her money scripts.  I honestly forgot about the interview until January, when a researcher from Self contacted me to verify my quotes. It was then I learned the article would run in March.

I didn’t mention the pending article in Self to anyone, other than my wife.  I’ve learned to wait until the article actually runs, that I am actually quoted, and that whatever I said or is said about me is actually complimentary before publicizing such things to the world!

Unfortunately, I did such a good job keeping the interview under wraps that I forgot to go out and buy the March issue when it hit the news stands about a month ago.  It was only yesterday, when I was having tea with Kathleen Fox, my co-author of Conscious Finance, that she nonchalantly mentioned that she had read an article in Self magazine about three weeks ago in which I was quoted several times.  Ironically, that same evening, the hostess at our favorite restaurant also mention that she was reading her Self magazine last month and was shocked see someone she actually knew quoted in a story.

I had nearly given up hope of finding a copy of the magazine when, while sitting in the chair at the barbershop, I looked over and saw Shania Twain staring up at me from the cover of the March issue of Self!  After some creative bargaining with my stylist, she happily agreed to part with the magazine and you can now read the entire article by clicking on the following link. Download 0603SELFMagazineArticle.pdf .