Cocktail Investing. Hawkins Lenore Elle

must-watch program on Netflix or Amazon Prime as he rockets to New Jersey from just outside of Washington, D.C., while for your other it sure helps with her obsessions: travel, power tools (working on those Bob Vila skills), the latest new tech toy, stilettos, wine, and photography equipment (hoping her talent will eventually catch up with the equipment).

      Some have a lot of it and some purposefully eschew it, but the bottom line – and that is what our book is all about – is we all need it.

      Whether it's to put food on the table, buy the latest whiz-bang device, which neither one of us can resist, or clothes for that soon-to-be-tween who is growing like a cornstalk on steroids, or simply to buy a great bottle of wine to celebrate that it's Tuesday and life is good, let alone to save for your golden years or to pay down the debt that's already been rung up, money is required both for the necessities and for having options: the “need to haves” and “want to haves.”

      Without it, you may find yourself forced into a situation you would desperately like to avoid, like Bob.

      Have you met Bob?

      On an unusually chilly day in San Diego, Lenore was rushing into her local UPS store in Del Mar when she essentially body-slammed into a rather strikingly handsome (her description), silver-haired gentleman who was rushing out with equal ferocity, sporting a scowl that would have made even the Dalai Lama take a step back. A shroud of sadness and anger seemed to emanate from his very being.

      She apologized profusely to him for her clumsiness, something for which she has had a great deal of practice, to which he responded with an eloquent, “Harumph.” Undaunted, Lenore was determined to get a smile out of this guy.

      “After making you drop so many things, the least I could do is buy you a cup of coffee or tea?”

      Silver-hair looked straight at Lenore like she was speaking Klingon, followed by a long, awkward silence. Her stubborn streak kicked in and she summoned up her best smile for him, trying to channel a Julia Roberts grin. He either decided he didn't have the energy to fight her or was so thrown he couldn't come up with something to help him escape and mumbled what sounded vaguely like “OK.”

      “Oh good! I could clearly use a few minutes to slow down. Thank you,” she said, and off they walked to the Starbucks next door. More precisely, Lenore walked and Silver-hair, whose name turned out to be Bob, followed begrudgingly.

      After an excruciatingly awkward five minutes of ordering and making feeble attempts at smalltalk while they waited for their white-and-green paper cups of warm magic to appear on the counter, they took a seat at a little table by the window. Lenore apologized again for running into him and told him how she was rushing around because she was flying back to Italy the following week, explaining how she ended up living a life on two continents after her father died, then getting a divorce and very much needing to escape the sadness of it all. Normally, Lenore never shares that level of personal detail with someone she has just met, but for some reason the gift of her Irish genes took over and her mouth took on a life of its own.

      Eventually, after a torrential river of words flowed from her mouth, the need to take a breath kicked in. Wondering if perhaps she had overshared, Lenore took a long sip of piping hot pumpkin latte (seriously, Starbucks, why not offer it all year?).

      Without warning, frustrated words started awkwardly tumbling out of Bob's mouth, and Lenore learned that his wife, Beth, had recently passed away. The cost of her medical care had destroyed much of their life's savings, which Bob had a hard time understanding, as he thought he had been so careful that he'd not even ventured near the stock market. On top of that, two of his three children were not even speaking to him because he had started dating his neighbor, Madeleine. Lenore got the distinct impression that Bob's wife hadn't particularly cared for Madeleine, which must have made for some painful family get-togethers.

      As he continued to talk, Bob jumped back and forth between expressing frustration over his financial affairs, the anguish he felt now that he was having to move in with his daughter, Sophia, who'd recently gone through a divorce herself, the delight at having found a woman who could make him laugh despite all his troubles and sadness, and anger at his other children for resenting his new relationship. When he finished, he stared down at his cup, fidgeting nervously with its plastic lid.

      Lenore could see he had the same, “Have I overshared?” look on his face, so she told him about how after her father's death, his side of the family had imploded with relationships permanently damaged at a time when she thought the family would have and should have been closer than ever.

      Sensing his troubles, Lenore offered, “My firm does investment management for families, so maybe we could help you sort through your finances and figure out where to go from here. It would help me feel better about having nearly knocked you into that wall!”

      They set a date and Bob suggested that perhaps Lenore could talk to his daughter, Sophia, who was struggling with pretty much everything as her divorce was finalizing. As they finished their respective beverages, Lenore suggested that Bob have Sophia call her, and they went their separate ways.

      In our collective experience, we've seen that money can be a lot like love. It can be heaven, or it can be hell.

      While we could ask you about money, odds are you would have a pretty good idea of just what that stuff in your wallet is and how it's used. Maybe not the history and legacy of it and you may not be fine-tuned on the inner workings of monetary policy, but when it comes to the functional use we're pretty sure you've figured it out. You did buy this book after all.

      We think a much better question to ask you is, “Do you think you have enough money…enough saved…enough invested for what is to come? If you think you do, how do you know?”

      Savings and Debt

      Bob thought he'd been exceptionally responsible. He'd put funds away every month for most of his adult life and proudly avoided investing in the stock market, believing his friends who did were essentially gambling. He's not alone in that. In Italy, the older generations do not even refer to investing in stock and bonds with the proper translation, “investire in borsa,” but rather more often use the term, “giocare in borsa,” which literally means “gambling on the stock exchange.”

      Even if you think you have it covered, the harsh reality is that many of us, like Bob, simply may not be as prepared as we think. Even for those who have been saving for a long time and are ahead of the 31 percent of U.S. adults who have no savings or pension plan1 it may not be enough. According to Bankrate.com, even 46 percent of the highest-income households ($75,000+ per year) and 52 percent of college graduates lack enough savings to cover a $500 car repair or $1,000 emergency room visit.2 Did you know the cost of raising a child through the age of 18 in either the United States or Canada is more than $240,000?!? In the United Kingdom, that number is $342,000.3 A recent report by AMP and the National Centre for Social and Economic Modeling in Australia found that the cost of raising two children to the age of 21 in that country rose more than 50 percent between 2007 and 2013 is now about $720,000. No wonder people are having fewer and fewer kids in the Western world!

      And it can be more, a lot more. Those are only the averages!

      We'd point out that excludes the cost of college, let alone if they get into an Ivy League! According to the College Board, a “moderate” college budget for an in-state public college for the 2013–2014 academic year averaged $22,826, while a moderate budget at a private college averaged $44,750. Some quick math puts that four-year cost between $91,000 and $180,000, but that's just the education part – room, board, and other items are extra. That's a pretty penny if you only have one child; if you have two or more children, it could easily cost over $1 million to raise them into their early twenties.

      Trust us, you are not alone in looking at that cost.

      According to the Consumer Financial Protection Bureau (CFPB), more than 40 million Americans are working to repay more than $1.2 trillion in outstanding student loan

1

31 percent of Americans have no retirement savings at all.

3

Rebecca Smithers, “Cost of Raising a Child Rises to £218,000,” The Guardian (January 26, 2012). Retrieved August 12, 2012. www.theguardian.com/money/2012/jan/26/cost-raising-child-rises-218000.