Wouldn't you rather live a no- or low-debt lifestyle, without the constant worry of money problems? With this book, you can learn the tools with which you can elevate yourself financially, and plan for a comfortable life and retirement. Whether you are a homemaker, physician, schoolteacher, or corporate president, you will find that you can refer to this book -- again and again -- for budgeting, debt-free, investment, financial, and consumer advice.
No Such Thing as Trust When it comes to Funds by Audra
Think you're financially savvy because you have a mutual fund, a 401K, and maybe even several thousand in stocks? Well, think again.
'Brokers are out to make a commission, and there is nothing wrong with that as long as you understand what their commissions are,' says Dr. Lois Center-Shabazz, author of Let's Get Financial Savvy! From Debt-Free to Investing with Ease. Dr. Center-Shabazz worked 15 successful years as a dentist in San Diego, CA, while pursuing her interest in investment and financial research. After she decided to sell her practice and move to Virginia, her newfound freedom allowed her to fully develop the investment education program she had started many years prior.
What she discovered in her financial research fueled her energy to educate others. 'I have to retrain people to not blindly trust [brokers],' says Dr. Center-Shabazz. She was angered to learn that the professionals in the financial industry were often misleading and uninformed after her own experiences with many. She says that many people believe that financial specialists work to increase their clients' wealth; but to the contrary, many of them are out to stuff their own pockets at their clients' expense. Dr. Center-Shabazz tells what's really going on in the business of finance through her Web site, book, and seminars.
Pointing to all of the fiefdoms, from corporate businesses to insurance companies, she says, 'Look at what happened with Enron, Tyco, Adelphia, the dot-coms and all those other corporations.' In those cases, she says that workers had trusted their employers with their money, not knowing that many in top management were only looking out for themselves. She notes a case with Enron where a retired worker had more than four million dollars in the company's stock, which he lost due to his company's fraudulent management of their investment funds. 'There is no way a retired worker should have had all of his money in one stock, nor should he have left it with the company well after retirement,' she says, adding that of course the top brass wouldn't advise him of that.
Another case Dr. Center-Shabazz notes is one in which a friend who lived out-of-state received $250,000 through a business sale and decided to invest the money in an annuity with a large brokerage firm. In terms of hidden and exorbitant costs, she says annuities are one of the worst forms of investing. After discovering that her friend had invested all of his money in an expensive annuity, she asked him to talk with a financial adviser in his neighborhood to see what the adviser thought about his investment decision. She says her friend told her that the adviser laughed loudly about his decision'the brokerage firm had been misleading in their explanation of the annuity. Luckily, she says her friend was able to cancel his agreement with the firm since he was still within the 3-day grace period of legal contract cancellation.
Dr. Center-Shabazz says there are ways to invest your money without paying astronomical fees and ridiculous costs, but brokers don't suggest any of them because it doesn't make them a commission, adding, 'Do you really think a broker is going to tell you about a low-cost, no-load mutual fund?' Dr. Center-Shabazz says that no-load mutual funds do not have front end and back-end loads attached and there are many from which to choose. Compare them to mutual funds with 3%, 6%, and even 8% front- or back-end loads, which Dr. Center-Shabazz says brokers are more likely to select when investing their clients' money because the load is how they are paid. All mutual funds have yearly fees so she suggests you choose those with low yearly fees, which are readily available through mutual fund research from most web portals. She includes a list of no-load and low-cost mutual funds on her Web site, www.MsFinancialSavvy.com.
Brokers' fees may not seem high when it comes to paying for the service of having someone manage your money, but over time, money that could have been earned in interest is lost'a fund that appears to yield a high rate on return only breaks even in cost, or worse, loses money. Dr. Center-Shabazz says that purchasing a no-load mutual fund is easy, provided you do your research first.
She notes that regulatory agencies like the Federal Trade Commission and the State Department of Consumer Affairs help to keep fraud down but they can't dissolve it completely. Consequently she has included an array of financial information on her Web site to educate the public. The idea for writing her book evolved from her initial Web venture as people wanted more and asked for a print newsletter'she in turn took their requests a step further by publishing Let's Get Financial Savvy! From Debt-Free to Investing With Ease, a two-time award-winning book.
Dr. Center-Shabazz says she geared her book toward women because women's lives tend to be more interrupted financially by pregnancies, relocating to support a husband's career, and also through the experience of death and divorce. 'Women need to understand that they must have their own financial security'they cannot depend on their husband's pension or believe that he will always be around.'
She says that after giving one of her financial seminars, an older woman came up to her to thank her for the information she had shared. The woman divulged that she had trusted her husband to manage their finances but he later left her for another woman and rendered her penniless. Dr. Center-Shabazz says there are ways that women can protect themselves financially. She notes that the Homemakers IRA is an example of a good account that allows provisions for a full-time homemaker to attain financial security for her later years after raising and caring for her family. With the Homemakers IRA if a woman's husband has a job or business with a retirement account she can fund a separate IRA account for herself.
When Dr. Center-Shabazz conducted her financial research she says she was overwhelmed in her reading because many financial books often dealt with one subject'either investing or budgeting or debt-reduction. To fill a niche, she says, 'I wanted to put everything in a book that was user-friendly and combined both creative budgeting and investing, while appealing to a wide range of readers. My book is liked by men also; a substantial number of book sales comes from men.'
In addition, the North American Book Dealers Exchange (NABE) awarded her book the 2002 Pinnacle Book Achievement Award for Self-Help, an honor that only 12 books achieve annually from the thousands from which the NABE makes their selection. Also, her book recently reached an unprecedented high rank of #147 on Amazon.com.
Today, Dr. Center-Shabazz is working on a novel about a wealthy black family that has arrived financially but finds themselves the prey of predators trying to rob them of their money.
She says that she finds her full-time career teaching investments and personal finances to be very gratifying and yearns to show that managing money doesn't have to be difficult. 'You have to know it for yourself. Just look at the thousands of media reports where intelligent citizens are robbed of their life savings by licensed professionals.'
Indeed, Dr. Center-Shabazz makes it clear that it's not about trust when it comes to funds.
About Audra Shivers (author of Dr. Lois Center-Shabazz article above)
Audra Shivers is a native of Richmond, VA. In addition to her professional
career as an editor, she has written for various newspapers and magazines, and
was the county correspondent for The Washington Afro-American newspaper. She
is a graduate of Southern Illinois University in Carbondale where she earned a
Bachelor of Science degree in Journalism. Ms. Shivers resides in Upper