On Wednesday January 12th, I am doing a Telecall about the Financial Recovery training program– how to become a Financial Recovery Coach. As many of you know, I am on the faculty of the Financial Recovery Institute. The Institute is founded by financial counseling pioneer Karen McCall. Over the past twenty years, Karen has developed a proven and nationally recognized methodology of helping people truly heal their relationship to money. She has trained new money coaches for over a decade. (Including me! I was one of the first coaches that Karen trained, back in 1996.)

If you are curious about this exploding field, please join us on Wednesday, January 12th at 5pm PT. We’ll talk about the training program and answer any questions you have. For more information on the Financial Recovery Institute, (or if you’re reading this post after the call!) go to www.financialrecovery.com. That is the home of the Financial Recovery Institute. (This year, we’re offering a “foundational” program for professionals who may not want to become full money coaches but want to add some of this expertise to their work. The full training program would enable you to open your own private practice as a money coach.) To register for this call– or to get the recording if you miss the live call– go to: www.financialrecovery.com You will see the register link at the bottom of the page for the January 12th call.

Yes, I know it’s only mid-November. But we all know that we’re starting to do some holiday planning.  Last night my sister and new brother-in-law were at my house for their first year wedding anniversary dinner party (I made the perfect pork roast!) and we started talking about exchanging gift lists. She is hosting this year at their new house in Everett. So– we can’t be the only ones with an eye on the holidays…

So here’s a question– Did you wake up last January with a spending hangover? You know what I mean- come January, when all the gifts are opened and the parties are over, the credit card bills begin to arrive.

Sadly, it takes the average American who uses credit cards to finance Christmas six to seven months to pay off the holidays. Who wants to be basking in the summer sunshine while still paying for the gifts you gave your kids, family and friends?

Be it right or wrong, women do a majority of the holiday planning and shopping. I hear many women say “I hate the holidays!” and “I might as well give up trying to pay off these cards- I’ve got to put on Christmas.” “Savings?! Who can save money during the holidays?”

Of course, our friends and family would never intentionally want us to jeopardize our financial security, or rack up debts on their behalf, but who ever thinks about it like that? And in the current economy, many people are even more stressed. Some have less money to spend for the holidays and feel overwhelmed at having to buy lots of gifts. But there is hope!

If you want to avoid that January spending hangover, consider this: at the root of post holiday debt is lack of planning. When we don’t do prior planning, we eliminate some of our buying options.

The answer is to create a “holiday spending plan”. I wrote this article last year and people really liked the steps laid out this way. So find 30 minutes, print this article out, grab a cup of coffee, a pencil and a pad of paper, and make sure you can Avoid the Post Holiday Spending Hangover.

8 Step Plan to Avoid the Post Holiday Spending Hangover

Step One: Create your Columns
On a sheet of paper, create three long columns. Label the first column “people”, the middle column “gift ideas” and the last column “amount”.

Step Two: Brainstorm People
Using a pencil, create a list of all the people you are planning on giving a gift to. Don’t put down gift ideas yet. Brainstorm people. One of the biggest problems around holiday gift giving is that we end up gifting a lot more people then we originally thought about. Consider creating three lists: Family, Friends, Service Providers (babysitters etc.)

Step Three: Brainstorm Gift Ideas
Write down gift ideas. You’ve likely already thought of gift ideas for some of the people. And make sure you write down in this column all the gifts you’ve already bought!! Did you pick up gifts over the summer or already start your shopping? Write these gifts down!

Step Four: What will the Gift Cost?
Now it is time to put down amounts of money in the right hand column. Do the best you can. You’ll enter a zero where you’ve already bought the gift you wrote down.

Step Five: Add it Up
Take a deep breath and add it up. This is the total amount you are planning on spending on gifts.

Step Six: Other Holiday Spending
Part of what puts people over the edge during the season is all the extra spending on things besides gifts. Grab another piece of paper and list out the following categories, with room under each category to break it down into smaller items. Write down: Holiday parties, Holiday food, Holiday decorations, Holiday travel, Holiday clothes, Holiday gift wrap/postage. Now go fill in the details. For example, under holiday decorations you may write down a tree, new lights for the tree and a couple of poinsettias.

Step Seven: What will the Other Holiday Items Cost?
Fill in the cost of these other forms of holiday spending. How much will the tree cost? Come up with a number for the new lights, gift wrap and postage. Guess where you have to. A guess is better than leaving it blank.

Step Eight: Totaling it Up and Adjusting
Now add your total gifts and your total “other holiday spending”. How do you feel about the amount? Does this seem like a reasonable amount to spend on the holidays? Really think about this. Can you afford this? Is it worth going into credit card debt to be able to give a gift to everyone you know? What are your other options? If your total plan seems too high, go back and make some adjustments and then re-total. Keep doing this until you feel better about the total.

This is often the time when people consider getting more creative. For example, can you give a family gift instead of gifting everyone in your friend’s family? Can you decide to draw names? I used to give gifts to friends but now we all go out and enjoy a play together. This came out of doing my own first holiday spending plan. I felt a little guilty when I approached them with my idea but discovered they were all relieved.

Remember, part of creating a plan is seeing what will happen before it happens! If you don’t like what you see, take the time to work on your list.

Be prepared to take this sheet of paper, this plan, with you when you shop- fold it up and put it in your purse. The best plan does you no good if you don’t bring it with you. As you spend money, jot down the amounts on your plan. Add up what you’ve spent on a weekly basis, or more if need-be. Where are you?

Trying to stick to a plan, regardless of how successful you are with it, will cut down on impulse buying, which is a major problem during the holidays. Without a plan, people buy more things and spend more money on each item they purchase. The temptations can be overwhelming when you are out shopping.

Also, a plan lets you know when you’ve completed your shopping. It tells you when to stop— if you don’t have a finish line, you are going to keep shopping as long as the stores are open.

Knowing what you want to buy and how much you want to spend, before you leave for the mall, will save you a ton of money. You will finish your shopping earlier and you will have fewer impulse buys.

You owe it to yourself to head off that infamous spending hangover. And don’t forget the best benefit of all: a spending plan cuts down on stress! You can enjoy the holidays like they were meant to be enjoyed.

Happy holidays!

If you have  some extra money that comes in unexpectedly, what do you do with it? Your answer may be related to your own money personality.

We all have different “money personalities”. And one simple way to think about your own personality is to ponder what truly motivates you around money. What is important about money? Regardless of whether you’re aware of it or not, these “money motivations” are part of your personality.

The good news is that if you get clear on your personal motivations, your financial behavior will make more sense to you. Of course you’ve done things the way you have, because you’ve had your own motivations that drove you! If you get conscious about these motivations, it will be easier to make cleaner money decisions.

There are two primary money motivations (well there are more but I’m going to focus on the big two here.) They are FREEDOM and SECURITY. Most of us are motivated by either the deep need for freedom or the deep need for security. Here are three quick questions to help you think about yourself:

1. Is money important to you right now because it allows you to:
a. Go out and get what you want?
b. Feel secure?

2. If you have money left over at the end of the month, do you:
a. Go out and have a good time?
b. Put the money into savings?

3. Are your goals about money:
a. To have enough of it so you can do what you want to do?
b. To save enough of it so you never have to worry about your old age?

Now granted, these are very simple questions. I know that. But I bet you see the point. Most of us are either motivated by freedom or by security.

If you’re motivated by freedom, you see money primarily as a source of freedom and you want and need a lot of autonomy in your life. If you sense there is not enough money, your deprivation buttons get pushed big time! You tend to chafe at schedules and are more likely to be self-employed or have a work schedule that doesn’t depend on you being at your desk 9 to 5. You’ve probably never worked seriously with a budget, but you are very generous with your money sometimes.

If you’re motivated by security, you see money primarily as a source of security. To you, money equals stability and protection. It means protection against bad things that could happen. You tend to not like a lot of risk (too stressful!) and you enjoy a regular source of income. (An erratic income is super hard on this personality type.)  You’re more likely to plan your finances, and you actually may enjoy this.

Keep in mind that neither one of these money motivations is better than the other. It’s about balance and not being too extreme. There is nothing wrong with being motivated by freedom. But taken to an extreme, you may blindly spend everything you’ve got and end up in deep debt. There’s nothing wrong with being security minded, but taken to an extreme you don’t risk enough and enjoy your life now. You don’t want to only live for the future!

If this intrigues you, I’m teaching a teleclass on understanding your money motivations on September 29th at 12 noon, Pacific Time. Register here. (We’ll send the recording out if you can’t make it live. But you need to register first to get the recording.)

If you would like to read more, check out Olivia Mellan’s books.  Start with Money Harmony. Olivia is a brilliant psychotherapist who focuses on money issues. And her famous book Money Harmony is still my favorite on understanding your money personality. She goes  very deep into many money personality types, going far beyond the two motivations I’ve written about here. (And her other awesome book, Overcoming Overspending- a winning plan for spenders and their partners, is really fabulous.)

So what about you? Are you more motivated by security or freedom? Has this changed for you over the years? Do share!

Well, I can’t make it any easier than this! Our events calendar is now up. Every month I will offer a one hour teleclass on some aspect of improving your relationship to money, for a whopping $37 bucks. (These calls are free to my current Financial Recovery Coaching clients.) I’ll teach for 40 minutes and then we’ll discuss your thoughts for the rest of the call. Or just download it if you can’t make it live. But I hope you’ll join me! June 23rd, 10am PT/ 1 pm ET.  (How to escape the “Money Life Drain” is on July 1st. Check out the calendar for other ones. I’ve got a really cool one on shopping and brain science in Oct. And then there’s the one on Noble Poverty etc etc. I love this stuff!)

From Underearning to Prosperity—the Four Keys  June 23rd, 10am PT/ 1pm ET
Underearning is the pattern of earning below your potential.  So are you earning at your potential? Or are you struggling against an “internal income ceiling”? In this powerful teleclass, Mikelann explores the psychology of why women undersell themselves and what to do about it. From expecting less money than other people, to difficulty in asking for what they really want, women who “underearn” deal with complex emotional issues around making money. Learn four crucial skills to earning what you are really worth and start making more money today!
We’ll cover:
•    One way to make asking what you want easier
•    How women under-price themselves and what to do about it
•    A powerful strategy to conquering the “good girl syndrome”
•    The importance of getting in touch with your “resentment number”.
Come away feeling empowered to earn what you are worth! You really can conquer underearning. Register.

I did it! I finally finished my new website about my money coaching/ Financial Recovery Coaching and I want to share it with you—www.seattlemoneycoach.com . (Yes, my clients are all over the country, but my actual office is in Seattle.) The Women’s Earning Institute has had a site for many years (and still does) but I’ve realized that the information on my coaching practice was very buried. That, and I think some people thought I stopped taking private clients because I do so much work on underearning issues. But underearning is just one facet of money coaching.

Actually, the number one reason people call me is that they are either tired of not feeling in control of their money (business or personal) or they just wish they felt—more in control of their money! And they want to escape the money fog, end the debt cycle, build meaningful savings and deal with emotional money issues. Oh yes—and earn more. So if you’re curious, I recorded a four minute video where I talk about my coaching practice. One of my gifts is helping people develop—and integrate into their lives–  their own P.F.P.- Personal Financial Practice. And self-employed people desperately need this too. (How many of us talk about developing our prayer or meditation practice?) It’s life-changing work. So check it out.  www.seattlemoneycoach.com (By the way, I do help train new Financial Recovery Coaches, so contact me directly for information on that.)

Is your “inner good girl” killing your business and causing you to underearn? Would you like to fix this without killing her? (Really, I don’t want to kill the woman. She’s actually very nice!) I’m doing two radio shows about this topic this week, so tune in if you can.

Tune in Wednesday, March 17th, 3 to 4pm Pacific to the Sisters of Sizzle radio program. I’ll be talking with them about how to earn your worth, from about 3:30 to 4pm. Go here: http://www.contacttalkradio.com/hosts/kloter-pagano.html and click on “Listen Live”.

Tune in Friday, March 19th, at 9am Pacific/ noon Eastern, when I will appear as a guest on the Femme Finance Radio Program. Deb Whitlock is interviewing me for a juicy hour on how we can conquer underearning—without killing our “inner good girl”. Go to www.ImThankful.com/radio and click the “Listen Live” buttons. (If you’re near Seattle, tune to 1150 am—KKNW.)

When I am interviewed, I commonly get asked “Why do women earn less than men?” Jeepers. It’s a huge question, and a very charged question. Talk about stepping into the fire! And I’m always frustrated that people expected a single answer! At any rate, I took on the challenge and recorded this tiny three minute video with my response.

I talk about two reasons, though there are more. So check it out and tell me what you think. The bottom line is that I do think women don’t ask for what they want as often as men do (and the research backs me up!) though the reasons behind this are also very complex. All the same, it causes us to underearn. I also mention a whopping second reason- “our relational nature”—we are so focused on other people that sometimes this really hurts us financially. It’s a version of that “good girl” thing, where we want people to like us, hate making people uncomfortable and sometimes give too much away… Comments?? Do you agree or disagree?

Is this you? You put in ten long hours on a big project, but when it came time to bill the client, you felt weird about charging for all of your time, so you shaved some time off.

Sometimes it is because you felt you couldn’t charge them for all of your “learning” time and sometimes you worried that they would experience sticker shock, so you helped them avoid this pain.

(What a good girl thing for you to do. How nice for them.)

Or is this you? You charge by the hour, but you give time away that you don’t charge for. Sessions may run over time, but you rarely bill your clients for this. You don’t let yourself think about how that time adds up.

(Again, what a good girl thing to do. How nice.)

Why Don’t We Earn Enough Money?

I write a lot about pricing and how to set your fees. But it’s not all about the fee. I talk to some women who say they think their fees are set at the right level—but then admit they just don’t always bill for all of the time they give to clients….

Ask yourself this important question: Are YOU ever guilty of underbilling?

Underbilling is a potent form of underearning. When you bill for less time then you worked, that is underbilling. It is one reason why we don’t earn enough money.

But you are worth more! You deserve to charge for all your time, honest. Stop giving yourself away. You would not support a friend in giving herself away for free. Why do it to yourself? It is unkind.

Billing for all your time is an important form of self care.

But why do we underbill?

• We may feel like we can’t charge a client for our “learning time”.
• We’re not tracking all our time so we can’t bill for all of it. (Does this one hit home for you? Isn’t it interesting that you are not tracking all your time.)
• We worry about our clients and inadvertently decide for them what they can and can’t afford.
• We don’t feel like we are quite “enough”- so we want to give and give to justify our money
• We are caught up in a perfectionist cycle and don’t ever feel like our work is quite perfect enough. So we discount it. (I hate to break it to you, but you’ll never be perfect. Sorry.)
• We’re not sure exactly how much money we need to make, so our own money fog sits like a cloud on our invoicing and our business in general. (Call me if you’re in a money fog! I can get you out!)

The list goes on.  Was your reason on the list? If not, what is your reason?

Like everything, we need to name the problem first, and then decide on a new course. Awareness is huge.

Your Three Month Challenge
So here is my challenge to you: Make a resolution. Even if you aren’t sure that you can end your underbilling forever, resolve to end it for three months.

Charge for every minute and every hour that you put in, from right now, in January, to March 31st.

Call it the Three Month Challenge to Stop Underbilling. Go with the discomfort. Force yourself to do it. And notice what you notice.

If you accept the challenge, join the (no-cost) 3 Month Challenge Encouragement Group here!

And please comment below: What do you think about this challenge and how it might impact you?

I recorded this four minute video to teach you a super powerful– but very simple– technique. I call it “Practicing the Pause”. Use it to protect your time and make more money. When people ask you for your time, “practice the pause”. When you are tempted to discount or undersell yourself in the moment, “practice the pause”. And tell me how it works for you!

Letter to service providers: Please charge me more money!

Okay, here is a really crazy post. I may even secretly hope certain people don’t see it! But… I get really nervous when my service providers don’t charge me enough money. Why? Because I know it can’t be sustained. Because I know that my service provider is walking the long and bleak road to self-deprivation, depletion and resentment. While other customers may deceive themselves into thinking they are getting a good deal when their massage therapist charges them an outrageously low amount, I wonder to myself, “How does she live on what she makes?” And I know she can’t stay in business over the long run.

Charging appropriately coveys confidence. Confidence is attractive! It tells me that you believe you are good at what you do. I work hard, and when I see a service provider, I want to relax and trust that they can deliver their service competently. Let me rest in your capable hands.

Besides, if you don’t charge me enough money, I may doubt that you can really help me. You don’t want me thinking, “I hope this isn’t a case where ‘you get what you pay for.’” Low fees tell me you must be brand new or you must not be very good. To be fair, this is not always conscious on my part. I’m only human. (Although I do assume expensive cheese and wine must somehow be better. High prices do convey that message, whether or not it is true.)

But the biggest reason I want you to charge me more money is because I know what other people don’t always realize. If you don’t charge me more money, you will disappear. And that would be a huge bummer for me. Like most women, I use a fair amount of service providers and I build relationships with them. I don’t see people I don’t like and trust. I like my hair dresser, my chiropractor, my therapist, and my waxer. In my business I have relationships with my virtual assistant, my editor, and my web developer. The list goes on and on! If they don’t make enough money, they’ll go out of business. Then what will I do?

If you don’t charge me, and everyone else, more money, will you make enough to continue being a business owner? Are you really charging me enough to pay all your business expenses and then pay yourself enough money to live on? And are you really living or are you merely surviving? If you don’t have enough money, you will become resentful, depleted and depressed. This will spill over into your work. And eventually, you will simply have to close the doors and do something else.

I don’t want to lose you. So PLEASE make sure you charge me enough money.