Just in time to help with your goal-setting, here is a list of 12 simple steps you can take with your money in the new year:

1. Develop a habit of saving: It’s never too early or too late to start.

2. Build a budget that aligns with your values: Think about what makes you happy and then allocate your money accordingly.

3. Create a financial plan that reflects your most cherished goals: Think of it as a roadmap to happiness.

4. Invest the maximum amount that you can for retirement: You will need more money than you think.

5. Build and maintain a diversified investment portfolio: Don’t worry about finding the “best” investment.

6. Review your spending periodically to keep yourself on track: It’s the key to living within your means.

7. When it comes to investing, avoid the crowd … and tips from well-meaning friends and relatives.

8. Understand that volatility is a normal occurrence when investing in stocks: Keep a cool head and stick to your plan.

9. Know what your money is doing—look at your investment statements at least quarterly: Ignorance is bliss, but not when it comes to your finances.

10. Insurance protects you from the unexpected: It’s just smart to have enough.

11. Choose your advisors wisely: Find people you like, trust, and who will listen to you.

12. Spend on the things and experiences that make you happy: They make life worth living.

Challenge: Choose one of the simple steps as your New Year resolution for your finances and write a short (200–250 word) essay describing how you will put it into action. In return, you will receive a 12 Simple Steps to Financial Success 2012 desktop calendar (see here), and your essay may be included in a future blog post on “Of Independent Means.”

Happy New Year!

Over the years, I’ve developed a few strategies that allow me to indulge my fashion passion and still manage to stay current on credit card bills, invest and save money. It’s all about stretching those dollars to stay within budget. You do have a clothing budget, don’t you?

Here are my top five strategies for smarter clothes shopping:

(I like to support the local economy, so most of the retail establishments mentioned below are in the San Francisco Bay Area. But most metropolitan areas will have similar venues—you just have to go out and find them!).

Strategy #1: Take a cue from chic French women and maintain a small but high quality wardrobe. Artfully use accessories to create different looks.

How? Find designers and shops that suit your fashion sensibility. Patronize these places—buy less, but buy what you love. As an added bonus, if you become a loyal customer, you’ll be invited to special sales and sample sales. My personal favorites:

FIT: www.fitclothing.net. FIT is a small clothing boutique in the Rockridge district in Oakland. Joyce Gardner, the owner, carefully curates her stock to satisfy her local clientele. She carries selected labels such as Schmacher, Cop Copine, Yoshi Kondo, Diane Von Furstenberg, Three Dot, Velvet by Graham and Spencer, and Pete. She packs a lot of style in a small space and her employees are adept at pulling looks together. She holds special sales and gives first dibs to her best customers.

Catherine Jane: http://catherinejane.net. Catherine Jane is a San Francisco designer who has an eye for gorgeous fabric and fit. She creates wonderfully feminine clothing with her own unique flare that will flatter your figure. Tip: Her sample sales are full of outrageous bargains.

The reward for buying high quality, timeless fashion is longer wear and thus less money spent over time.

Strategy #2: Find consignment shops whose buyers are very picky and who echo your style sensibility.

Yes, these are pre-owned and pre-worn garments. If you don’t have a problem with that, it’s a great way to add pieces to your wardrobe at good prices. Here’s how consignment shops work: Women bring in their current, gently worn and seasonal items and the store buyer selects which pieces work for her store. Then she splits the sale price with the seller, usually 50/50 or 60/40. Prices are generally 1/4 of retail prices.

My personal favorite consignment shop is Mirabel (3251 Lakeshore Ave, Oakland). This store is full of fashion gems. You will find labels such as Marc Jacobs, Burning Torch, Velvet by Graham and Spencer, Diane Von Furstenberg, Prada and Missoni as well as a carefully edited selection of Banana Republic, J. Crew and H&M. Occasionally there will be truly great finds (like an Isabel Marant leather jacket I found recently).

Added bonus: If you don’t want to buy, you can always sell clothing that is gathering dust in your closet.

Strategy #3: Find a fashion stylist to audit your closet and help you shop.

If you love clothes but hate to shop or feel like you make a lot of expensive buying mistakes, hiring a personal stylist may be the perfect solution. She can save you both time and money and you’ll look great with minimal effort.

Great Find: Urban Darling. www.urbandarling.com

Stylist: Lisa Deane. www.urbandarling.com/stylists/lisa-deane/

For more tips on working with a stylist, check out my previous post, “Save Money By Shopping in Your Own Closet with a Wardrobe Stylist.”

Strategy #4: If you don’t like going to shops, bring the shop to you!

There are clothing lines that are sold only in private venues. If you host a party, not only do you get to invite all your friends, you receive 50% off your items depending on how much others buy. Personally, I like the CAbi (Carol Anderson By Invitation) line. And my favorite CAbi consultant is Erin Saul who lives in Oakland.

Great Find: CAbi. www.cabionline.com/

Strategy #5: Use the Internet to find sales on items you crave.

You see a gorgeous pair of shoes at Bloomingdale’s. You can’t afford them. Go home and do a Google search using the specific brand name, style and color. You may find that the shoes are on sale somewhere else. In addition, you can ask retailers to match prices if you find them lower on-line. Don’t be afraid to ask.

I think these five strategies will give you a good start on smart clothing shopping. But, if your closets are bulging and think you might have a shopping problem you may need another kind of help. Jill Chivers, a former shopaholic, has created the “My Year Without Clothes Shopping” program for people like you. Her program offers a fun and safe way to “break the cycle of unconscious and compulsive shopping” and to be more in control of your money. Check out her website: www.myyearwithoutclothesshopping.com

I would love to hear of any tips or strategies you have to be stylish without breaking the bank. Please share your thoughts!

Carol Moretti (seated) and Lisa Deane

In my living room sat an architect, a CPA, a healthcare executive, a innovation consultant, a marketing and branding expert, a retired attorney, a writer for the Huffington Post, a clutter coach, an interior designer, a home staging specialist, a jewelry designer, a technical writer, and a newspaper columnist. We were joined by an IT manager, a freelance interactive producer, an owner of a cooking-party company, an owner of a company specializing in culinary health education for kids, a development director, a yoga instructor, a marketing consultant, a personal fashion stylist, a trade marketing manager and a business student. All women. All interesting and accomplished.

Women are as diverse as any other group of people in their career choices and in their lifestyles. But women also share distinct attributes: They are great communicators, relationship builders and nurturers. They also share unique financial planning needs. For example, many women are concerned that they will be old and poor and alone. Look at these facts:

• Eighty percent of American women will find themselves the sole keepers of their personal finances at some point during their lives, However, most of those women feel financially insecure, despite controlling more wealth, having more education and being more involved in financial decisions.
• Women still make less than men make in similar occupations.
• Women’s careers are often interrupted by family needs, such as childcare and eldercare, which limits their opportunity for income and retirement savings growth.
• Many women fear losing everything and becoming bag ladies (and it doesn’t seem to matter how much money they have or make).
• Two-thirds of women over age 65 rely on Social Security as their primary source of income. Consequently, women are twice as likely as men to live out their golden years at or below poverty levels.

In my living room, we nibbled bites of grilled salmon covered in sesame seeds, ginger chicken, and artichoke frittata while sipping champagne cocktails. Everyone listened attentively to presentations on serious topics such as the 2010 tax relief act and the new healthcare law, but also to fun topics such as the top ten wardrobe essentials and how to save money on your wardrobe. In between speakers, we women did what we are great at: connected, made new friends and perhaps got a business lead or two.

About Cathy Curtis
Cathy Curtis, the writer of this blog and owner of Curtis Financial Planning, specializes in the finances of women, their families and their businesses. You can find out more about her on her website www.curtisfinancialplanning.com and follow her on Twitter @curtisfinancial, on Facebook Women and Money and on LinkedIn Women and Money.

As part of our work, financial planners must take into account our clients tolerance for risk. Personal financial goals, risk tolerance and, a clients age, will be among some the factors that shape any plan. Along the way, a financial plan has to be reviewed and tweaked to accommodate changing conditions — as in the economic meltdown in 2008. Good, sound financial advice – whether to stay the course or to make adjustments are key to long term success.

In financial planning, as in life, some of the best laid plans have to have some built-in flexibility to meet conditions on the ground. Or, as our story will show, on the sea.

Meet Jessica Watson – Sailor, Savvy Planner, Risk Taker

Jessica Watson - Youngest Around the World Solo Sailor

When we talk about planning, tolerance for risk, adjusting to changing conditions, sheer courage, and staying the course, we could hardly find a more inspirational example than Jessica Watson, a savvy young woman from Buderim, Australia.

Jessica, at this very moment, is sailing around the world. She is alone, on a solo voyage. Her pink sailboat is named Ella’s Pink Lady.  She is well over 5,000 miles into her epic journey and is about to sail straight into the fearsome Southern Ocean and the Cape of Good Hope.

Jessica is sixteen years old.

If she is successful, she will be the youngest person ever to sail around the world solo, unassisted. On her website, she lists her philosophy – “Always make the best of everything. Stay positive, ask questions, lots of questions.”

Not a bad approach for someone trying to sail around the world, or for life in general, or for someone trying to plan their financial life.

As a financial planner who focuses on women, their families and businesses, I think Jessica Watson is one savvy young woman. It’s clear from her blog and website that she is a serious planner who knows what her goals are, knows how to create a plan to achieve her goals, has the smarts and the skills to adjust as conditions change and has something that will stand her in good stead the rest of her life – courage.

Go Jessica!

Last week I had the pleasure and satisfaction of watching six women entrepreneurs present their business stories to their peers and loved ones at the Slate Gallery in Oakland’s Temescal District. Each woman had just completed a 12 week course in entrepreneurship developed by the Hatch Network, a new, San Francisco-based company whose mission is “to be the absolute best provider of entrepreneurial education and services for women in the world.”   

What the Hatch Network does, besides provide the curriculum, is to establish a network that connects experienced business veterans – the mentors – with ambitious business owners – the students.  Once those connections are established, the teaching/mentoring begins.

When Hatch Network co-owners, Allie Covarrubias and Claire Fontana asked that I become a mentor in their network, I didn’t hesitate. I was already familiar with their skills as leaders and visionaries and I wanted to become a part of their new venture.  Mentoring women entrepreneurs seemed like such a great complement to my financial planning practice, where I focus on women, their families and businesses.My initial concerns about time committments (I’m a solo practitioner, self employed) proved to be premature. This was a rich and rewarding experience.

So, back to the graduation celebration at the Slate Gallery in Oakland. The 12 weeks of classes are structured so that at the end, students are prepared for and required to present their business story as if they were presenting to investors or clients. They outline the who, what, when, why and how much of their business. The challenge is meant to help them achieve clarity over important business questions. Who are we? What do we provide. Who are our clients? Why are we unique? What benefits accrue to our customers? How much does our service cost? How much will we sell? And most important, how much will we make? 

As you might expect, each of the six women were as nervous as a long-tailed cat in a roomful of rocking chairs. Public speaking was a daunting prospect, added to the writing and technical skills needed to pull together a dynamic  8-10 minute presentation. But when they each took their turn, it was as if they had been practicing for days….each more polished and professional than the next. It was truly gratifying to watch them and to have been a part of their story.

Who are these ambitious women and what are their businesses? 

Pascale Teysseire
Owner,  Funding for College 
Provides a personalized college funding search to assist students/parents in attaining financial aid: scholarships, fellowships, and grants –  necessary to attend the college of their choice.

Jane Inch    
Owner, Jane Inch Life Coaching:  Reveal Your Inner Sparkle (website coming soon!)
Provides lifestyle and business design programs for the midlife/empty nester who is seeking clarity and is ready to launch “what’s next” in her life. 

Linzi Oliver
Owner, Doggy & Me Fitness
Provides an outdoor fitness class for you and your dog. 

Feleciai Favroth 
Owner,  The Art of Bathing
Provides handcrafted creams and soaps with the finest natural ingredients including shea butter
olive, jojoba, coconut and essential oils.  

Elizabeth Husserl 
Owner, Inner Economics
Facilitates  processes of awareness and change around people’s relationship to money.

Anne Cavazos 
Owner, Cavazos Environmental Consulting
Provides high quality and cost effective environmental consulting services.

Congratulations, ladies!

If you’re interested in becoming a Hatch Network student, my next class starts in January and will be held in Oakland, California. Here’s an abbreviated course syllabus:

Week 1:  Evaluating your Entrepreneurial Opportunity
Week 2:  Identifying Your Ideal Customer
Week 3:  Scoping Out The Competition
Week 4:  What Are You Selling
Week 5:  Building your Brand
Week 6:  Your Company Message
Week 7:  What To Charge
Week 8:  Marketing Focus
Week 9:  Sales 101
Week 10: Finding  the Money
Week 11: Book Keeping, Briefly Legal, Insurance 101
Week 12: Be the Boss Lady:  Team Building, Leadership
Week 13:  Your Business Story

If you would like more information, go to The Hatch Network’s website or email Cathy Curtis
at cathy at curtisfinancialplanning.com

Hatch away!

The Irrepressible Trudy

Lots of women know their hair stylist almost as well as they know their closest friends. That’s why we don’t dread haircuts the way men do – we actually look forward to the 1-2 hours when a friendly person will make us beautiful with the added bonus of a good  heart-to-heart. No staring glumly at the mirror until it’s done for us! Topics of conversation in a hair salon run from love life to clothes, movies to food, and of course, my personal favorite, money.

Meet Trudy
So without further ado, please meet my hair stylist, Trudy. She’s 40-ish,  a single-mom (of a 13 year old daughter), a homeowner, a fashionista, and, as you can tell from this photo, irrepressibly vivacious.

On my last visit, we got into a chat about money because Trudy had just completed a loan modification and was more than happy to share the details with me. I was very interested because I knew banks were considering loan modifications, but hadn’t heard of anyone actually getting one.

Trudy’s story is typical of many American homeowners who were enticed by loans that “magically” made debts disappear and lowered mortgage payments.

Here’s what happened. Trudy bought a condominium in Hercules, California in 2003. She paid $248,000. She put $50,000 down and took out a 30 year fixed rate loan for $202,000.

She was thrilled to become a homeowner and excited by the prospect of home price appreciation.

When a Refi is a No-No
Fast forward a couple of years later. Her condo had appreciated but so had her credit card debt. Enticed by all the refinance offers that came in the mail daily, she decided to investigate. Not fully understanding what she was getting into, Trudy refinanced her loan to one that offered a myriad of payment choices, better known as an “option-ARM.” The lowest payment option caused the loan to negatively amortize – which means the deferred interest is added to the outstanding loan balance – the exact opposite of a fixed amortizing loan where part of every single loan payment reduces the mortgage balance.

Like many other homeowners before and after her, Trudy chose this option in order to improve her cash flow and at the same time pay off her $30,000 in credit card debt. It’s understandable why this would seem like a good idea, but unless you truly understand what you’re getting into, the ramifications can be devastating.

By the time she applied for the loan modification in December of 2008, her deferred interest had grown to $22,000, her loan was now $260,000 and the interest rate was 7.11%.

All hell broke loose in September 2008.  Trudy received child support from her ex, which helped make ends meet. But he was a mortgage salesperson and with the fall-out from the credit crisis his income was slashed by $80,000 a year.  He was able to get the court to reduce his child support from $1200.00 a month to $180.00 a month. Ouch!

House Underwater
Trudy notified her mortgage company in October that she wasn’t able to make her payment. She had few options. Her loan balance was larger than her home value (also known as being “under-water”) so selling wasn’t an option.  She knew foreclosure was next and starting thinking about moving in with friends or family to regroup.

She found out about loan modifications and applied with her lender. She was turned down in January – the lender cited “information contained in her credit report.”

With a Little Help From Her Lender, Trudy Pulls Through
Then, as fortune would have it, President Obama’s mortgage relief program “Making Home Affordable” was launched in March. Trudy re-applied and this time she was successful. She received a letter of agreement on April 10 from her lender. Here are the new terms:  1. The lender agreed to reduce her loan balance by $53,442.4 to $208,402.44.  2. A new payment and interest schedule starts with a 2% interest rate and gradually increases (.75) per year to 6.5%. 3. Interest only payments are valid, but the borrower can choose to make a fully amortizing payment.

After hearing Trudy’s story, I did a little sleuthing to get some updates on the Obama administration’s $50 Billion mortgage relief program.  Turns out that Trudy was lucky. So far, the results have been disappointing, as lenders were not cooperating. But there are signs that this is changing.

Lenders have sent out offers to reduce monthly payments to around 19% of 3 million eligible borrowers’ -  – this is up from 15% at the end of July. Here’s the story>>

In the end, Trudy’s persistent and irrepressible self saved the day. She’s learned a lot of lessons from this…one of which is to always read the fine print and to better manage her use of credit cards.

You can find Trudy at the beauty salon at the Claremont Hotel in Berkeley, 510-843-3000 or at Altogether Different in Corte Madera, 510-334-5401.