February is known as Heart Month and has become a time for us to assess our health. As women, we sometimes delay our own needs to instead care for others, such as our children, spouses, aging parents, and employees. However, it is crucial that we also take time to care for ourselves, not only to tend to our health but to tend to our finances, as well.

Too few Americans are prepared financially for an emergency.  A survey by the Federal Reserve found that more than 25 percent of Americans have skipped necessary healthcare because of the cost.[1]  And another recent survey by Bankrate found that only 39 percent of Americans could cover an emergency of $1,000 out of their savings.[2]  With these alarming statistics, you should be prepared for any unexpected situation.

An emergency can constitute any situation that catches you by surprise and for which you are financially unprepared. Cars break down, homes get leaks, and sometimes the tax bill is bigger than you anticipated. Having an emergency fund may help you financially withstand bad news without racking up debt.

Create your emergency fund now

Do not put off something today, that you should have done yesterday. Start saving for an emergency fund today. A general rule of thumb is to save three to six months’ worth of expenses.[3] That number can shift depending on your specific circumstances. If you have children or are helping care for aging parents, you should save more than if you are single. Conversely, if you have parents who might help you in case of a crisis or you have other means of savings, you may need less in your emergency fund.

It can feel overwhelming to think of hitting your goal of three to six months’ worth of savings.   So, start small. If you can put away just $20 a week, by the end of the year, you will have saved $1,000 for your emergency fund.[4] Additionally, throw your extra change each week in a jar and watch that begin to accumulate for your fund.

Where to place your emergency fund

In an emergency, you may not have time to sell stock or other assets.  The key is to have quick, easy access to the funds.  This avenue may be accomplished through opening a money market or basic savings account.  You need that quick access, but not such easy access that it is tempting to use for other purchases. [5] Look for an account that does not have annual fees or a minimum balance requirement.[6]

Make savings a habit

Whether saving for retirement, college or an emergency fund, make saving a weekly or monthly habit.  Once you hit the three-to six-month saving goal for your emergency fund, continue to save.  And, if you do need to withdraw some money for an emergency, make sure you replenish it so there are funds for next time.

Creating an emergency fund is not necessarily fun, but the confidence it will bring you will be worth it.  Savings should be a priority so that you stay financially prepared and secure for anything life throws at you.

Claudia Mollerup-Madsen, Vice-President and Financial Advisor at Morgan Stanley in Houston, was born in Peru, and spent her life as an expat child living around the world.  Claudia graduated from St. Mary’s University in San Antonio with a BA in International Business.  She is fluent in both Spanish and English and has been in the financial advisory sector for 30 years, serving both U.S. and Non-U.S. citizens.

She worked for Merrill Lynch from 1989-1990; Citigroup Private Bank 1990-2001; UBS International 2001- 2009; and moved to Morgan Stanley in 2009.

Claudia has received several awards and honors including being named as one of Houston Business Journal’s 2018 Women Who Mean Business and being honored as a member of the 2019 MAKERS class, which celebrates the trailblazing women of today and tomorrow.   She is also a member of the Morgan Stanley Women’s Advisory Council, an honor chosen by her management team to develop the empowerment and professional advancement of female advisors.

She has been interviewed multiple times as a financial expert on ABC13, Univision, KUHF, NPR, Houston Business Journal and KPRC 950 am.

She is a past board member for The Women’s Resource of Greater Houston and continues to teach financial literacy to women and young women at risk.  Additionally, she is a member of the Houston Livestock Show and Rodeo’s International committee and a USTA Texas region board member, an elite group of tennis advocates promoting tennis.

Claudia Mollerup-Madsen

Vice President and Financial Advisor, Wealth Management Division , Morgan Stanley

[1] https://www.morganstanley.com/access/emergency-funds

[2] https://www.morganstanley.com/access/emergency-funds

[3] https://www.morganstanley.com/access/emergency-funds

[4] https://www.saveandinvest.org/military-everyday-finances/start-emergency-fund

[5] https://www.morganstanley.com/access/emergency-funds

[6] https://www.morganstanley.com/access/emergency-funds

 

Claudia Mollerup-Madsen is Vice President and Financial Advisor with the Wealth Management Division of Morgan Stanley in Houston.

A new year brings a new opportunity to stay vigilante about cybersecurity. In 2017, more than 143 million Americans were affected by cybercrimes; and it is estimated that cybercrime costs $600 billion annually – up from $500 billion.  According to one study, Texas ranked number three among states in cybercrime complaints last year.  Whether the crime is credit card fraud, phishing, identity theft or account stealing, it is essential that you protect yourself from these harmful actions.

Below are some tips to help you stay safe in our cyber-world.  While many of these focus on personal actions that you can take to protect yourself, businesses are constantly bombarded with potential attacks. According to UPS Capital, cyber-attacks cost small businesses between $84,000 and $148,000, with 60% of them going out of business within six months of an attack.  If you are a business owner, make sure your company’s cybersecurity is up-to-date as well.

Keep your software, operating system and browser up to date

It is vital to keep your software updated. Malware can make its way into your computer through software, operating systems, and browsers. Software companies send out updates to help patch holes in the security.

Incorporate multi-factor authentication

Multi-factor authentication is a tool to help keep you secure when logging into a bank account, financial transaction, or other site that uses your personal information. By using multi-factor authentication, you will be required to take an extra step of verifying yourself through a push notification sent to your cell phone or one-time passcode sent to you.

Do not use public charging cords or USB ports

While you may know not to use public wi-fi spots, you may not be aware of the dangers of publicly available charging cords or USB ports. By charging your phone or device by these methods, you are making your devices vulnerable to malware. Malware can then silently steal data from your phone or device.  Take your own cord and plug it directly into the wall.

Do not use the same old passwords over and over

We have all done it. However, do not use the same usernames and passwords for different websites and applications. If a hacker gains access to one account, they can then gain access to other ones as well.  Consider using a password manager to generate different passwords and keep them tucked away for you.

Do not share too much information on social media

Sharing too much information is another common mistake that too many of us make. It’s easy to get excited about trips or experiences and want to share that information on your social media sites.  Beware. A fraudulent scheme could use the information you share online. Enabling strict security and privacy settings may help.

Leverage online statements and paperless options

Ensure you shred all paper documents that contain personal information before you discard them.   Better yet, sign up for online account statements and other paperless options such as eSign and eDelivery. These online tools contain added security features. Ask your banker and financial advisor for more information regarding online options.

As with all facets in life including within the cyber-world, be aware of your surroundings, make smart choices, and verify requests before sending any personal information.

 

Claudia Mollerup-Madsen, Vice-President and Financial Advisor at Morgan Stanley in Houston, was born in Peru, and spent her life as an expat child living around the world.  Claudia graduated from St. Mary’s University in San Antonio with a BA in International Business.  She is fluent in both Spanish and English and has been in the financial advisory sector for 30 years, serving both U.S. and Non-U.S. citizens.

She worked for Merrill Lynch from 1989-1990; Citigroup Private Bank 1990-2001; UBS International 2001- 2009; and moved to Morgan Stanley in 2009.

Claudia has received several awards and honors including being named as one of Houston Business Journal’s 2018 Women Who Mean Business and being honored as a member of the 2019 MAKERS class, which celebrates the trailblazing women of today and tomorrow.   She is also a member of the Morgan Stanley Women’s Advisory Council, an honor chosen by her management team to develop the empowerment and professional advancement of female advisors.

She has been interviewed multiple times as a financial expert on ABC13, Univision, KUHF, NPR, Houston Business Journal and KPRC 950 am.

She is a past board member for The Women’s Resource of Greater Houston and continues to teach financial literacy to women and young women at risk.  Additionally, she is a member of the Houston Livestock Show and Rodeo’s International committee and a USTA Texas region board member, an elite group of tennis advocates promoting tennis.

Claudia Mollerup-Madsen

Vice President and Financial Advisor, Wealth Management Division , Morgan Stanley

The holidays are here, and another year is coming to a close; that means as a business owner, there are special considerations you need to keep in mind during this time of year.  Of course, you want to end the year strong and begin 2019 with an energized and healthy financial standing so here are some recommendations as you round out 2018.

Staff Up and Order Supplies

If you provide goods or services that tend to ramp up during the holidays, ensure you have adequate staff in place to keep up with the demand.   You may need to institute a “no time off” policy during the month of December.  If so, make sure your employees know this before they are hired. Good communication from the beginning is key. Additionally, let your staff know ahead of time which days or time periods will be busiest so that everyone can be prepared and more productive. If critical employees are ill or have an emergency, make sure you, as the business leader, have contingency plans to fill their role.

While you are scheduling and maintaining adequate staffing levels, confirm you have supplies stocked.   This includes not only office supplies, but supplies for manufacturing products or providing services for customers. There is nothing much worse than running out of critical inventory during the holiday peak period.

Do Not Ignore Finances

As you gear up for the end of year, do not neglect your financial affairs. Ensure your bookkeeping, especially your income and expenses, is correct. Look at your finances to see if you should be setting aside money for taxes or arranging for other means to pay the IRS.   You may be better off making  estimated payments quarterly than making one payment in April to the IRS.  Paying taxes quarterly allows you to manage your business’ cash flow more efficiently. Speak with your accountant for more information.

Contribute to your Retirement

As a business owner, make sure you are taking advantage of your company benefits. They are not only for your employees, after all. If your company offers a 401(k)-retirement plan, make sure you take advantage of it before the end of the year to maximize tax benefits. If your company does not offer a 401(k), make sure you are contributing to an IRA. The maximum employee contribution to a 401(k) for 2018 is $18,500. The limit to an IRA is $5,500 for 2018, if you are under 50 years of age.

Consider Bonuses and Gifts

If your business has done financially well this year and you have greater discretionary income, you may be considering giving out bonuses. While there is not a one-size fits all approach to how much is appropriate in a bonus, do make sure you provide consistency when giving them. For example, giving a percentage of employees’ salaries might be a good guideline.  An added bonus for the business owner, bonuses can be tax deductible for a business.

Think about Succession Planning

You may be too young to retire, or just starting your business, but it is never too early to have plans for the future in place.  Whether you will transition your business to family members or sell to an outside buyer, putting succession plans into place now can be helpful as you look toward the new year.  Ask your financial advisor for guidance.

Minimize the stress and holiday bustle by planning ahead to help usher in a smooth transition from end of year to the new year.  By preparing for potential problems and outlining ways to keep the trains moving on time, as they say, you will be able to enjoy some well-earned time off.

Claudia Mollerup-Madsen is Vice President and a Financial Advisor with the Wealth Management Division of Morgan Stanley in Houston.

Claudia Mollerup-Madsen, Vice-President and Financial Advisor at Morgan Stanley in Houston, was born in Peru, and spent her life as an expat child living around the world.  Claudia graduated from St. Mary’s University in San Antonio with a BA in International Business.  She is fluent in both Spanish and English and has been in the financial advisory sector for 30 years, serving both U.S. and Non-U.S. citizens.

She worked for Merrill Lynch from 1989-1990; Citigroup Private Bank 1990-2001; UBS International 2001- 2009; and moved to Morgan Stanley in 2009.

Claudia has received several awards and honors including being named as one of Houston Business Journal’s 2018 Women Who Mean Business and being honored as a member of the 2019 MAKERS class, which celebrates the trailblazing women of today and tomorrow.   She is also a member of the Morgan Stanley Women’s Advisory Council, an honor chosen by her management team to develop the empowerment and professional advancement of female advisors.

She has been interviewed multiple times as a financial expert on ABC13, Univision, KUHF, NPR, Houston Business Journal and KPRC 950 am.

She is a past board member for The Women’s Resource of Greater Houston and continues to teach financial literacy to women and young women at risk.  Additionally, she is a member of the Houston Livestock Show and Rodeo’s International committee and a USTA Texas region board member, an elite group of tennis advocates promoting tennis.

Claudia Mollerup-Madsen

Vice President and Financial Advisor, Wealth Management Division , Morgan Stanley

With Halloween behind us, we move with full momentum into the holidays and the shopping season.  Black Friday is November 23, the day after Thanksgiving and traditionally the busiest shopping day of the year.  The holiday shopping season is crucial to the retail industry as 30 percent of sales occur between Thanksgiving and Christmas, and for items such as jewelry, it is even higher at about 40 percent of annual sales.

The term Black Friday became a popular reference to the day after Thanksgiving in the 2000s when more and more retailers offered over-the-top sales and promotions on the day after Turkey Day. Before that period, the busiest shopping day had been the Saturday before Christmas. Each year, the Black Friday and Cyber Monday sales seem to get bigger and better for consumers.

This year is expected to be no exception. The National Retail Federation (NRF) is predicting spending to be up 4.1 percent over last year’s winter holidays with consumers spending an average of $1,007.24 per person on gifts, food, décor, and simply good retail deals. While shoppers continue to visit traditional bricks and mortar stores, on-line sales continue to grow. 71 percent of shoppers say they will purchase at least one holiday need on their smart phone or tablet.

All this shopping helps grow  our economy. NRF is forecasting $720.89 billion in holiday sales this year. The high number of sales also means seasonal jobs. Retailers have already advertised more than 330,000 jobs for this holiday season, and with our low employment numbers, workers can expect to be recruited like never before.

While these numbers  help boost the economy, please ensure you are smart with you own spending. As a financial advisor, I have seen folks get carried away by sales and the excitement, putting themselves and their families into debt. Here are a few tips to keep you from spending more than you should:

Create a budget. While this seems obvious, you would be surprised how many people just buy presents as they go. Start with a budget for each person you are shopping for and plan ahead. Make a spreadsheet to stay organized and keep your spending for each person in check.

Don’t be swayed by a store’s allure. Retailers are smart and they provide mood lighting, music, and smells that lure us in and make it harder to say no to buying. Stick to your budget and your plan.  Similarly, know your weaknesses and be prepared to be resist items you like or you know your family or friends would like. It is a wonderful feeling to give to others, just make sure you stick to your original plan.

Be smart about your credit card use. Try to carry only one credit card so it is easier to keep tabs on your spending.  And please make sure you pay off your credit card balance soon after the holidays. You do not want to get stuck paying interest or paying for Christmas next summer. Even better than using a credit card is using a debit card or old-fashioned cash.

You will find great deals this Black Friday and Cyber Monday shopping period. If you are able, take advantage of them, but stay smart and savvy about your holiday spending.

Claudia Mollerup-Madsen is Vice President a Financial Advisor with the Wealth Management Division of Morgan Stanley in Houston.

Claudia Mollerup-Madsen, Vice-President and Financial Advisor at Morgan Stanley in Houston, was born in Peru, and spent her life as an expat child living around the world.  Claudia graduated from St. Mary’s University in San Antonio with a BA in International Business.  She is fluent in both Spanish and English and has been in the financial advisory sector for 30 years, serving both U.S. and Non-U.S. citizens.

She worked for Merrill Lynch from 1989-1990; Citigroup Private Bank 1990-2001; UBS International 2001- 2009; and moved to Morgan Stanley in 2009.

Claudia has received several awards and honors including being named as one of Houston Business Journal’s 2018 Women Who Mean Business and being honored as a member of the 2019 MAKERS class, which celebrates the trailblazing women of today and tomorrow.   She is also a member of the Morgan Stanley Women’s Advisory Council, an honor chosen by her management team to develop the empowerment and professional advancement of female advisors.

She has been interviewed multiple times as a financial expert on ABC13, Univision, KUHF, NPR, Houston Business Journal and KPRC 950 am.

She is a past board member for The Women’s Resource of Greater Houston and continues to teach financial literacy to women and young women at risk.  Additionally, she is a member of the Houston Livestock Show and Rodeo’s International committee and a USTA Texas region board member, an elite group of tennis advocates promoting tennis.

Claudia Mollerup-Madsen

Vice President and Financial Advisor, Wealth Management Division , Morgan Stanley

It is a wonderful time to be a woman in business. There are many opportunities to grab success by the hand and make an impact on the economy and the future.  According to the National Association of Women Business Owners, 11.6 Million firms are owned by women, generating $1.7 Trillion in sales and employing 9 Million people.[1] In the past 20 years, women-owned businesses have grown 114% compared to the overall national growth rate of 44% for all businesses; women-owned businesses make up 39% of all U.S. firms.[2],[3]

This month, let’s celebrate the strength and resilience of women business owners. October is National Women’s Small Business Month; and October 15–21 is National Business Women’s Week.

If you are dreaming of being your own boss and are ready to be a part of these empowering statistics, let’s talk about how to a start your own business.

Write a business plan

Your first step needs to be writing a business plan. It is the foundation and backbone of your new company. A business plan is like a road-map for you to follow to run and grow your business. It is also a key element for securing funding from investors.[4]

Decide on your business structure

Your business structure, whether a Sole Proprietorship, Partnership, LLC, C Corp, S Corp, or another form, dictates many things about your company including taxes, liability, paperwork to file, and day-to-day operations.[5] You will need to determine your structure before you apply for a Tax ID number and any licenses or permits. Choose your business structure wisely. While you can usually change the structure later, there could be tax implications. Also, you will need to register your business with any local, state and federal agencies.

Think through your funding options

Are you able to take money from your personal and savings accounts to start your business? Determine how much you have available from your own sources, then decide how much you need from elsewhere.  If you can invest some of your own money (a capital contribution) to purchase equipment in the early stages, banks are more likely to grant you a loan as it shows them you have skin in the game.

Debt funding, which is simply borrowing money to be paid back over a period of time with interest, is a simple way to start your business if it is right for you. Types of debt funding including SBA loans, term business loans (similar to traditional bank loans), short-term loans, equipment financing, and a business line of credit.[6]

You may also consider equity financing, especially if you do not want to go into debt right off the bat.  Types of equity financing include angel investors and venture capital. However, a significant drawback of equity financing is that you are sharing ownership with other investors; keep that in mind if you consider this option and want to go solo.

Determining your budget

Once you have your business plan, structure, and funding in place, focus on maintaining a budget that is realistic to your business’s needs. A realistic budget can be the difference between having a successful business and joining the 50 percent of small businesses that fail in the first year.[7] Remember that you will be required to pay for equipment, marketing, possibly staff, and other expenses.  Unanticipated costs occur from time-to-time so overestimate your expenses.

Having a sound budget is crucial when you plan to expand your business.  If you are deciding between hiring employees or relocating your space, you should prioritize your decision based on which option serves your budget best and which one can wait.  Remember, as your business evolves, so will your budget. Take the time to review it consistently.

Meanwhile, ensure you have an emergency fund. Your goal should be to have an emergency fund equal to six months of basic expenses. An emergency fund will make the months where business is slow more sustainable. Additionally, continue to save for your retirement during your start-up months.  Do not lose sight of saving for the long-term.

Consult your financial advisor, legal counsel, and tax professional to discuss the best types of structures, funding, and budgeting for your specific situation.

Claudia Mollerup-Madsen is Vice President and a Financial Advisor with the Wealth Management Division of Morgan Stanley in Houston.

[1] Women Business Owner Statistics
[2] THE 2017 STATE OF WOMEN-OWNED BUSINESSES REPORT
[3] THE 2017 STATE OF WOMEN-OWNED BUSINESSES REPORT
[4] Write Your Business Plan – SBA
[5] Choose a Business Structure – SBA
[6] How to Get a Loan to Start a Business: Follow These 4 Steps

Claudia Mollerup-Madsen, Vice-President and Financial Advisor at Morgan Stanley in Houston, was born in Peru, and spent her life as an expat child living around the world.  Claudia graduated from St. Mary’s University in San Antonio with a BA in International Business.  She is fluent in both Spanish and English and has been in the financial advisory sector for 30 years, serving both U.S. and Non-U.S. citizens.

She worked for Merrill Lynch from 1989-1990; Citigroup Private Bank 1990-2001; UBS International 2001- 2009; and moved to Morgan Stanley in 2009.

Claudia has received several awards and honors including being named as one of Houston Business Journal’s 2018 Women Who Mean Business and being honored as a member of the 2019 MAKERS class, which celebrates the trailblazing women of today and tomorrow.   She is also a member of the Morgan Stanley Women’s Advisory Council, an honor chosen by her management team to develop the empowerment and professional advancement of female advisors.

She has been interviewed multiple times as a financial expert on ABC13, Univision, KUHF, NPR, Houston Business Journal and KPRC 950 am.

She is a past board member for The Women’s Resource of Greater Houston and continues to teach financial literacy to women and young women at risk.  Additionally, she is a member of the Houston Livestock Show and Rodeo’s International committee and a USTA Texas region board member, an elite group of tennis advocates promoting tennis.

Claudia Mollerup-Madsen

Vice President and Financial Advisor, Wealth Management Division , Morgan Stanley

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