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Q&a moving from model to mogul taught kathy ireland about money

´╗┐ormer supermodel Kathy Ireland has a very familiar face, but these days, it is her apparel and home furnishing brands that grab attention. For someone who was not taken seriously in the business world at first, Ireland now has a net worth of almost a half-billion dollars, according to Forbes magazine, and is even buddies with Berkshire Hathaway legend Warren Buffett. Take that, doubters. For the latest in Reuters' "Life Lessons" series, Ireland sat down to talk about what she has learned from her life's extraordinary journey. Q: What did you learn about money growing up? A: My dad always taught me to under-promise and over-deliver. On my old paper route, if someone expected a paper in their driveway, I put it on their front porch. Q: As you became a success in the modeling world, how did you start investing that money?A: I started to look at what made sense to me. Growing up in California, real estate made sense. Prices always seemed to just climb and climb. As a result I purchased my first condo when I was only 21. Q: Was it strange to be thrown into circles of extreme wealth, in the fashion world?

A: There was a lot of frivolity all around me: Cars, clothes, fancy meals. But what some people thought was luxury, I thought was just wasteful. I never felt comfortable earning a living based on my outward appearance - it always felt temporary to me. I just thought of modeling as an opportunity to save money for college or start a business. Q: When you launched your business post-modeling, did some people not take you seriously?A: Quite a bit. It was written that I have a voice that could kill small animals, that whoever hired me for a TV special should be shot, that women couldn't relate to me because I was a bimbo. And that was just the public stuff!In private, it could be even worse. Once I was in a meeting about fitness equipment, and a man leaned over and said, 'Don't worry your pretty little head about this. Don't you want to stay home and make babies?'

Q: You obviously proved them wrong, so what business role models did you aspire to?A: One is Irv Blumkin of Nebraska Furniture Mart, a Berkshire Hathaway business. He got us our start in the home industry by giving our brand a chance, when others were laughing in our faces. Eventually our business family came to include Warren Buffett, who counseled me not to limit our company to fashion, which can be so cyclical. Q: You have structured kathy ireland Worldwide (kiWW) as a private company - is the hope that your three children might one day take over?A: There will always be career opportunities here for our children, if they are interested in the business. But I want them to live out their own dreams. What I love about being a private company is that many of my decisions might not fly on Wall Street, but they work for me. Once I walked away from a deal worth millions of dollars because I wasn't happy with the safety of the products, which met standards in some states but not others.

Q: What kind of philanthropic legacy do you want to leave behind?A: I look up to Elizabeth Taylor, who was virtually a member of our family. She commanded a vast empire, but was always in charge. With her AIDS foundation, she left clear, focused goals, and directed exactly where she wanted the funding to go and which people to help. That's powerful. These days I'm honored to be an ambassador for her foundation, and not a day goes by that I don't miss her. Q: When it comes to giving, how do you decide where to allocate your dollars?A: I want to see people getting results. That is what I look at. If I am joining an organization, I need to look at the books and see the financials. Q: What money lessons do you pass along to your own kids?A: We want to give our kids the resources to not live in fear, but not so much that it kills their motivation. The other day one of my daughters wanted to buy some art pens, so she had to do some babysitting. She made a choice - and she earned it.

Your money act now to nab a free spring break trip

´╗┐With massive travel reward point bonuses on the table this fall, consumers who sign up for a new credit card could be flying free for spring break. But if you are like most people, you will file this information away in the back of your mind and forget to act on it until it is too late. A new data analysis by the consumer website has found that 83 percent of consumers apply for credit cards at the wrong time. That leaves 15,338 miles on the table, or about $177. Pro tip: You need about five months' lead time. So if you want to travel over spring break in March or April, get a new card by October or November (for the full table, see Reuters spoke with Nerdwallet's credit card expert Sean McQuay about the ins and outs of applying for new credit cards and how to maximize the benefits. Q: Your study works out the best time to get a new credit card. How do you figure this out?A: Consumers need to give themselves enough lead time to meet the spending requirements, get the points loaded into the account and then book the travel with reasonable notice. What we did was we took a large number of cards and tracked the signup bonuses, and noted the bump when there was a special. Q: How are people missing this window?

A: The biggest thing is they are not planning signups in advance. They may have received a mailer or saw an ad online, and then they sign up right then. I can't blame people for that because nobody had done a timeline analysis before. General travel cards give the best offers in November, but the majority of signups peak in summer time - April through August. That's telling me that they see these cards and say, I want to travel, but by that point it's far to late to fund that summer's travel. Q: You also have done an analysis of the relative value of cash-back cards versus travel reward cards. Which is better?A: The break-even was $8,600 worth of travel in a year.

So this is where it gets interesting; if less than that, you'd do better with cash-back without an annual fee. But the mental benefit of getting free travel is huge. Q: A new card on the market - the Chase Sapphire Reserve- is offering 100,000 reward points, but comes with a hefty annual fee of $450. Is this a game-changer?A: I've never seen 100,000 before. The highest I've seen was Chase Sapphire Preferred with an $800 sign-up bonus, which was available during two short-term offers. But this is 100,000, which is valued at $1,500. I do think it's part of a larger trend. But it takes months, if not years, to spin out a new product. Existing players would need to do a lot of work to keep up. 

Q: Is there any sort of financial detriment to signing up for many cards, just to glean the rewards?A: It hurts your credit score less than you think to sign up for a card and then cancel it. (NOTE: make sure cancelling doesn't delete your points)There's also a 5/24 rule at some banks, which means that if you've signed up for five cards in the last 24 months, it's an automatic decline. You can also sometimes transfer a card to a lesser version that would not have an annual fee. I just did this myself. Q: What about the moral hazard of just continually signing up for cards?A: I feel bad for signing up for a card just for short-term benefit. I know that's a silly feeling to have, but I feel like being an honest consumer, you do not sign up for credit. But it is not like banks are trying to clamp down. And in a way, they are encouraging it by offering richer short-term rewards rather than long-term. That's an argument for go ahead and sign up. 

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