If I Had a Billion Dollars

woman with money

If you are a child of the 80s and 90s like I am, you probably remember the Barenaked Ladies song “If I Had a Million Dollars.”  They sang about all the things they would do if they had a million dollars, ending the song by saying “I’d be rich!”  Well fast forward to today and a million dollars is no longer what it once was.  With soaring real estate costs and the crazy inflation of the past few years, most people could easily spend a million dollars and it might not drastically change their lives. 

What Would You Do with a Billion Dollars?

However, thinking about what you would do if you came into a large sum of money can be an illuminating exercise.  When we think about financial goals, most of us think about paying off student loans or saving enough so that we can retire at 65.  But those goals aren’t very exciting.  While they are important and should be done, they aren’t the kind of goals that get most people bounding out of bed in the morning to get started.  Goals that are exciting and get people motivated are things like supporting an organization that they are passionate about or building a business.  When we start to reframe money as a tool to help us achieve our goals, rather than just something we need to have to pay off debt or save for the future, working on our goals can be a lot more exciting.

To shift from thinking about the financial “shoulds” to the financial “coulds” start by thinking about what you would do if you suddenly (legally and ethically) came into a large sum of money.  For the sake of the exercise, let’s say you woke up tomorrow morning and found your checking account with a billion dollars in it.  Why a billion?  Because while most of us could easily spend a million dollars in today’s economy, it’s pretty hard to spend a billion dollars.  At that level, money is no object.  You and your family will be secure.  How would your life change?

I Would Quit My Job, Of Course!

For many, the first thought might be quitting their job.  Is that what comes to mind for you?  If so, is the cause that you don’t want to work ever again, or just that you don’t want to work at your current job anymore?  Are there things you would like to do if salary and benefits weren’t the main driver?  Maybe you have always dreamed about working for a non-profit or becoming a ski instructor, but those jobs don’t provide the resources you need to maintain your lifestyle.  But if money was no longer a concern, how would you like to fill your time?  While retiring at forty-five might sound like a win, in reality most people need some kind of purpose to build their days around beyond endless golf.  Finding a career that is aligned with your passions is one possibility. 

What about starting that business that you have been secretly thinking about for years?  Maybe its opening a bakery and coffee shop in your neighborhood.  Not only do you have to be comfortable with an unpredictable income, but there is also the huge upfront cost of building out the space.  What seems nearly impossible in your current reality because of the financial risks could be possible if money is no longer a concern.  Would you do it?

Why is Retirement the Goal?

I once met a man who told me he couldn’t work with a financial advisor because every advisor he met immediately started to talk to him about retirement.  He asked why he would ever retire when he had the perfect life.  The man was an author who worked out of his home.    He was able to wake up and write in the morning, and then greet his son when he got off the school bus in the afternoon.  In his view, his life was perfect as it was and there was no need to retire.  This man made me think – why isn’t the goal to build a life you never want to retire from rather than toiling for decades at a job you hate just so you can retire at 65?

What is Possible When Money is No Object

Using the billion-dollar exercise is a way to start opening your mind to what is possible.  Most people never think expansively about what is possible.  In fact, when you ask most people their financial goals, they say things like retire at 65 or travel.  But when you ask why, they don’t know.  They are just regurgitating what they have heard from others or seen in the press.  And those aren’t the kinds of goals that make foregoing spending today for the promise of a different financial tomorrow very exciting.

While it is unlikely that you or I will suddenly wake up to find ourselves billionaires, what is possible is starting to create the life we envision when money is no object.  I am not talking about buying a private jet or a mansion in the French Riveria.   But I am talking about using money as a tool to move your day-to-day activities more in line with your values.  And living the life you want now instead of waiting for some far-off future date.  What if you could figure out a way to start that business or work at that non-profit without winning the lottery?  How different could your life look if you woke up every day with a sense of joy and excitement for what was ahead rather than a feeling of dread?

Step One: Create the Vision

It might seem impossible to reach these goals from where you sit today.  However, I am here to tell you that it is more possible than you think.  The first step is to create the vision.  What can you dream up when you start to think out of the box?  Take off all of the expectations of family and society.  What is it that you want to do with your life in your heart of hearts?

I don’t believe that you can manifest your dream life just by putting it out in the universe.  But I do believe that if you take time to examine what is actually important to you and what you really want your life to look like, then you can start to achieve it.  And your money is a tool that can help you do it. 

The problem most people face is not that they can’t achieve their goals, it’s that they never take the time to really think about what is possible because they are too busy with the day to day of what already is.  Do you want the next twenty years of your life to look like the last or are you ready to start building something that you really love?

Sara Zuckerman, CFP®, CDFA® is the founder of Reset Financial Planning located Scottsdale, AZ and serving women across the country with a focus on helping women who find themselves suddenly single in mid-life, align their financial resources with their values to plan for the next chapter of their lives.


If you are interested in learning about how I can help you take charge of your finances as a newly single woman, please contact me at  or schedule a free 20-minute consultation.


Sign up for Reset FP’s Monthly Newsletter to effortlessly stay on top of my weekly blog posts and occasional extra goodies and receive my Get Your Finances Organized Checklist for free!


Disclaimer: This article is provided for educational, general information, and illustration purposes only. Nothing contained in the material constitutes tax advice, a recommendation for purchase or sale of any security, or investment advisory services. We encourage you to consult a financial planner, accountant, and/or legal counsel for advice specific to your situation. Reproduction of this material is prohibited without written permission from Reset Financial Planning, LLC, and all rights are reserved. 

Money Stories: Understanding the Roots of Your Financial Behavior

Money Stories

I have heard many financial advisors over the years say they got into this industry because they were good at math and liked the stock market.  But what you quickly learn as a financial planner is that math has very little to do with how people manage their money.  I can run all the calculations I like and explain until I am blue in the face about optimal tax strategies, but it’s mostly a waste of time.  You see, money isn’t a number on a spreadsheet.  It’s a concept and that concept is deeply tied with our emotions whether we realize it or not.

The way we think about and interact with our money has very little to do with the number in an account or the goods and services we can trade it for.  Rather, it is based on our money stories.  And our money stories are shaped by a lifetime of experience and attitudes that have been passed down to us by our parents and their parents before them.  And in fact, if there was money trauma in your past, or your parents past it is likely affecting how you think about and interact with your money now.

Defining Your Money Story

Have you ever thought about your money story?  If not, I suggest spending some time thinking about it.  As a starting point, think about your earliest memory of money.  Or how money was discussed (or not) in your household growing up.  Did you ever experience a sudden influx or unexpected outflow of a large amount of money?  Were you taught that money was dirty?  Or that money was not something to be discussed?  Or did you grow up with “enough” such that you had everything you needed and didn’t think much about it?

For me, my parents divorced when I was five.  I don’t remember much before that time, but I know that after that money was tight for a number of years as my parents worked to reestablish their own finances.  One of my first real memories of money is standing in a Target with my mom and brother.  My brother wanted something and our mom told him we couldn’t afford it.  My brother lost it.  He did not like being told that he couldn’t afford something he wanted.  Fast forward thirty years and this is still true for him.  He started working as soon as he could as a teenager and hasn’t stopped since.  He likes to be able to afford what he wants, when he wants it, and he doesn’t want anyone to tell him otherwise.

Another early memory I have is of my father sitting at the kitchen table “doing” his bills.  He owned a construction business and did all of the bookkeeping for it in the evenings in our kitchen.  From this I learned about things like balancing a checkbook and keeping your financial records organized.  I don’t remember there being any particular feeling of scarcity or abundance around this process, it was just a very methodical process (done with a handheld calculator and a legal pad because home computers weren’t a thing yet).

Another interesting exercise is to think about what socio-economic class you were in during elementary or middle school.  How did you know?  For those of us who grew up in the 80s and 90s, we didn’t have social media showing us how the ultra-wealthy live.  If you are like me, you likely had a frame of reference that didn’t extend much beyond your school or town.  While there may have been different levels of wealth in those environments, it was likely not that many degrees of difference.  It wasn’t until college and beyond that I really understood how varied the wealth levels of different people are.

Identifying Patterns and Beliefs

As you start to think about these early experiences, do you see any patterns in your life now that you can connect?  Did you grow up with little money, and now that you earn your own money you can’t stop spending on everything you want?  Or is it just the opposite and you hoard money, fearing to spend any in case it all goes away?  Or maybe you think that finances and investing aren’t something you can understand because you were never taught about them, or you received messaging that women can’t (or shouldn’t) handle the money.

There is no one way that a past experience will express itself in your current behavior.  If you have siblings, you can easily see this.  Although you may have had very similar experiences growing up, I am willing to bet that you and your brothers or sisters interact differently with money now.  The key is to understand what you experienced and what patterns you see in your attitudes and behaviors now that you can connect back to those experiences.

Unpacking Limiting Money Beliefs

As you start to understand your money story, you can also start to see what limiting beliefs might be tied to your story.  Perhaps culturally, you learned that wealth is equal to success and so you feel that you aren’t successful unless you have a high-earning job even if that job is making you miserable.  Alternatively, maybe you grew up hearing negative comments when someone in the neighborhood bought an expensive new car and so you think that external displays of wealth are a bad thing.

Regardless of what beliefs you have, identifying them is the first step.  Then you can decide if they are serving you now or not.  It is not a fact that driving a nice car makes you a bad person if that is what makes you happy (and you are financially able to afford it).  Just as it is not a fact that you can’t be successful unless you earn a lot of money.  You get to define what makes you feel successful and if that is being a partner in a fancy law firm working 80 hours a week then that’s great.  But if it’s working for a non-profit where you get to see the positive impact of your work on the lives of others every day (but aren’t earning oodles of money) then that is success too.

Creating a New Money Narrative

Once you understand more about your money story and the beliefs resulting from that story, you can start to create a new narrative.  What role do you want money to play in your life?  For me, I want to be able to use it as a tool to achieve the life I want including more time with family, good health and the freedom of running my own business.  I don’t need fancy cars or expensive handbags.  I have had those things in the past and have found that they don’t bring me joy.  I am much happier when I am able to use my money in alignment with my values.

And don’t be afraid to get professional guidance if needed.  If you never learned about managing your finances and have been hampered by the belief that you “can’t”, consider investing in a personal finance course.  Or perhaps your money issues run deeper or there was real financial trauma in your past.  Consult with a financial therapist or coach.  They will help you with strategies to move past the issues and into a more positive space.  You have the power to change your relationship with money and do things differently in the future.

Money Stories in Action

Money stories are incredibly powerful in shaping our behavior, but most people aren’t aware of them.  Understanding your money story, and the patterns and beliefs that story has created in your life, is a great first step.  Once you know why you behave in a certain way, you can more easily change that behavior if you desire. 

If you find this topic as interesting as I do, there are a number of ways to learn more.  One is through the 50 Fires podcast with financial planner Carl Richards.  He delves into money memories and money stories with his guests in a very open and honest way.  It’s a great way to understand more about how emotions (many of them subconscious) have so much more to do with your money than numbers do.

Sara Zuckerman, CFP®, CDFA® is the founder of Reset Financial Planning located Scottsdale, AZ and serving women across the country with a focus on helping women who find themselves suddenly single in mid-life, align their financial resources with their values to plan for the next chapter of their lives.


If you are interested in learning about how I can help you take charge of your finances as a newly single woman, please contact me at  or schedule a free 20-minute consultation.


Sign up for Reset FP’s Monthly Newsletter to effortlessly stay on top of my weekly blog posts and occasional extra goodies and receive my Get Your Finances Organized Checklist for free!


Disclaimer: This article is provided for educational, general information, and illustration purposes only. Nothing contained in the material constitutes tax advice, a recommendation for purchase or sale of any security, or investment advisory services. We encourage you to consult a financial planner, accountant, and/or legal counsel for advice specific to your situation. Reproduction of this material is prohibited without written permission from Reset Financial Planning, LLC, and all rights are reserved. 

New Year, New Financial Beginning: A Guide to Setting Goals and Taking Control

woman making financial goals for new year

The beginning of the New Year is often a time to set resolutions for the year or to feel like you are starting again with a clean slate.  This is no different with your finances.  Use the New Year as a reminder to check in, review your plan and make sure you know your goals for the year.  Whether you are in the midst of a transition due to divorce or loss of a spouse or are moving forward after experiencing something like this in recent years, working through this process can bring you a sense of control and optimism for the year ahead.

Review Your Goals

As you start to think about your financial objectives for the coming year, it’s a good idea to revisit your goals.  Are there any major life changes on the horizon like a move or a job change?  Are your kids heading off to college or turning twenty-six and therefore no longer eligible to be covered by your health insurance?  Or maybe there are circumstances beyond your control that you are worried about, like potential layoffs at your company.  Start by listing out all of these items.  Have you included them in your financial plan or are there updates that need to be made?

It’s also a good time to reconsider your priorities.  Maybe you have been working to aggressively pay down debt, but now it’s at more manageable levels so you want to consider reallocating a portion of those funds to something else.  Or maybe your kids are starting school full-time and so you can use money you were previously paying for daycare to start to build college savings for them.  Life changes every year, especially when you are raising kids, and so things that might have been top priority last year aren’t as important as you look into the new year.

Update Your Cash Flow

Once you have a good understanding of your goals and priorities you can then consider the changes you need to make to your budget.  Start by comparing your actual expenses last year to your plan.  Were they in line or were there items that were much higher or lower than anticipated?  Make sure you have a good handle on the necessities like food and utilities before making changes to discretionary items.

Does your updated budget allow for more retirement savings?  Are you maximizing your retirement contributions at work?  If not, consider increasing it even a percentage point or two.  Little increments over long periods of time can make a significant impact on your future life and you won’t even notice the difference in your paycheck.  If you are already maximizing your work plan, are you able to make an IRA contribution?  Depending on your income level, you can consider either a Roth or Traditional IRA contribution in addition to what you are saving at work.  These contributions may or may not be tax deductible, but they do allow you to get a little more tucked away for retirement.  And don’t forget, you have up until the tax deadline of April 15th this year to make IRA contributions for 2023.

Finally, check in on any Flexible Spending Accounts (FSAs) that you have through work.  Make sure you request reimbursement for any related spending in 2023.  And if your employer allows it, take advantage of any grace period (usually up until March 15th) to use up any unused funds or roll them to this year before they are lost forever.

Consider Your Assets & Debt

The new year is also a good reminder to check in on your assets and debt to see if there are any changes that need to be made.  To start, do you have your emergency fund set up and funded with at least three to six months’ worth of expenses? If not, this is a good time to replenish it.  If you are concerned about anything specific, like a water heater that is on its last legs or a downturn in your business, consider putting even more than the recommended amount aside to handle what may come. 

On the investment side, it’s a good opportunity to rebalance your accounts.  Is your portfolio still in line with the target asset allocation you set?  Last year was a good year for the stock market, so it might be time to take some of those gains off the table and reinvest in bonds so that you aren’t taking on more risk than you intended.

In terms of debt, what objectives do you have for the year?  If you took out a new mortgage in the past year, you likely have a 6 or 7% interest rate.  Based on the Fed’s plans, rates should come down in 2024 so it’s worth keeping your eye out for refinancing opportunities.  If you have nonmortgage debt that you would like to eliminate, create a plan for that.  Start with debt that has the highest interest rates first and then work down the list paying them off one at a time.

Don’t Forget Tax Issues

Finally, it’s also a good time to start thinking about your taxes.  Tax documents will start coming in any day so create a folder to keep everything organized and accessible.  Again, this is a good time to consider any additional retirement savings that might be available for 2023.  If you are a business owner, work with your accountant to determine how much you might be able to contribute to a solo 401k or a SEP IRA.  And as discussed above, make sure you complete any Traditional or Roth IRA contributions prior to the tax deadline.

In terms of your investments, review your unrealized gains and losses and create a harvesting strategy.  If you have carried forward losses from prior years, is there any rebalancing that you need to do from a risk standpoint that you can strategically offset with those losses.  And you if get stock as part of your compensation at work, consider your plan for diversification this year.  What will be vesting when and what is your plan for it?  Do you have any stock options expiring during the year that you need to plan for?  While these events can create large taxable gains, having a plan will allow you to prepare in advance and ensure that you are managing your risk appropriately.

Like anything else that you want to improve in your life, good fiscal management and planning takes some work.  Use the turn of the calendar year as an opportunity to check in with yourself and your goals.  Make any adjustments you need to based on what you anticipate in the year ahead.  Financial planning is not a point-in-time exercise.  It’s an ongoing process, using the best information you have and then adjusting to reality as it happens.  Your financial life is like a road trip.  When you start out, your map may tell you that it’s a six-hour drive, but as you go along, it continuously updates for traffic conditions and detours.  Make the best plan you can as you start the year, and then be prepared to adjust and react as the year unfolds.

If you are interested in learning about how I can help you take charge of your finances as a newly single woman, please contact me at  or schedule a free 20-minute consultation.

Sign up for Reset FP’s Monthly Newsletter to effortlessly stay on top of my weekly blog posts and occasional extra goodies and receive my Get Your Finances Organized Checklist for free!

Follow my YouTube channel for weekly videos covering a range of topics that will be helpful to you as you start to take control of your finances and adjust to your new normal.

Mastering the Art of Budgeting: Your Path to Financial Freedom

Your doctor tells you to eat right and exercise.  Your financial advisor tells you to create a budget and then stick to it.  It’s standard advice that is easy to give and not so easy to implement.  I am not a health expert so we will leave diet and exercise to the side for a moment, but I can tell you that in order to fully take charge of your financial life you do need to create a budget.

Why You Need a Budget

The purpose of a budget is not necessarily to reduce your spending, it’s to help you make more intentional decisions about your spending.  With tap to pay credit cards, online ordering and subscription services everywhere, people are increasingly detached from their money.  Putting it all on paper (or in an app) allows you to understand where your money is going and if it is really going to the things that bring you the most joy and satisfaction, or it’s just…going.

In addition to helping you be more intentional about your spending, a budget can also offer several other benefits.  One key benefit of creating a budget is that it can reduce your financial stress.  Having a plan for where your money is going and how you will deal with unexpected expenses can go a long way towards making you feel in control and less stressed.  Additionally, having a budget allows you to make progress towards meeting your financial goals.  By setting up savings and investing goals, you will ensure that you are planning for the future while also enjoying the present.

This post will cover the basics of budgeting including creating a budget, monitoring a budget and some tools that can help you along the way.  While budgeting is unlikely to be your favorite activity, it is a powerful tool and does not have to be complicated or time consuming.

The Basics of Budgeting

A budget is the tracking of income and expenses.  Simply put, it’s a tool to track the money that comes in and the money that goes out.  As a first step, you need to create a view of the current situation.  Once you understand where you are now, you can start to layer in goals and build a roadmap of where you want to be.  This process is the foundation of financial success.

Gathering Financial Information

The first step in creating a budget is to gather information on income and expenses.  You can use pay stubs, bank statements and credit card charges as a starting point.  Don’t forget to include expenses that you pay once or twice a year, like insurance.  If possible, start with at least three months of data so that you include expenses that happen periodically but not necessarily every month.  This can be a lot of data to start, but once you get it all organized, things will be much easier going forward.

Setting Financial Goals

As you gather data, this is also a good time to think about financial goals.  Do you have major purchases that you are planning for in the next year?  Are you saving for retirement?  Have you created an emergency fund with three to six months of expenses in cash? Start to write down these goals so that you can build them into your budget.  Include both short- and long-term goals, whether it’s a family vacation next summer or retirement in twenty years.  By starting to think about and plan for these goals, you will be much more likely to achieve them.

Creating Your Budget

Now that you have all of your income and expense data, and have outlined your financial goals, it’s time to create your budget.  There is no right way to build a budget.  I am a fan of budgeting tools like Mint and YNAB because they automate much of the data collection and categorization.  But there are plenty of free budget worksheets online that you can download as well.  The goal is to group all of your income and expenses into a handful of categories like Housing, Utilities, Food and Entertainment (note: while your credit cards provide this categorization it neglects the full picture of your financial situation).

I also recommend tagging each category as fixed, flex or periodic.  Fixed expenses are things like rent or utilities that are the same (or relatively the same) each month.  Flexible expenses are those things like food and Amazon that can vary widely depending on the month.  Periodic includes those expenses that only come up a couple of times a year, think car insurance or taxes.  The flex category is typically the one that destroys the budget and is also the first place to look if you need to cut back on things.

Once you have everything categorized, this is where you can really start to learn something.  Take a look at each category and see which ones surprise you.  Is that daily trip to the coffee shop adding up to a whole lot more than you thought on a monthly or yearly basis? (No judgement on the coffee, if it makes you happy do it, but I promise there will be one or more categories that shock you when they are all totaled up).  This is also where you start to see the levers you have to pull.  Is there enough going into the savings bucket?  If not, what are some of the categories where you feel you are spending too much that you can pull back on?

Sticking to Your Budget

Creating the budget is just the first step in the process.  Once created, you must follow it.  Much like diet and exercise, the easier you make this on yourself the more successful you will be.  Step one is automate, automate, automate.  Have retirement savings taken out of your paycheck by your employer, set up auto transfers to savings to happen on each pay day, set up auto pay for those fixed expenses that are the same each month.  By having that all happen automatically, it ensures that it gets done and prevents financial fatigue for you.

Once everything that can be automated is automated, the hard work begins.  For the things that are more flexible, you actually have to be more intentional and make decisions every day.  If eating out is costing you more than you would like, then set a limit for yourself.  And monitor it.  Once you hit your number for the month, decline the invites to checkout a new hot restaurant.  Or if you know a friend has a big birthday and the end of the month and will want to go out, eat at home more at the beginning of the month.

Monitoring and Adjusting Your Budget

While creating the budget is a big milestone, it’s not something you do once and then set aside forever.  Your situation will evolve over time and your budget will need to evolve as well.  I recommend to my clients that they set aside one night a month to update their budget.  Put it in the calendar and stick to it.  Once you have the framework created, a monthly update should not take much time unless something big changes in your life.  But the exercise gives you the opportunity to reflect and think about where you are making decisions that support your goals and where you are making decisions that detract from them. 

Having a handle on your budget is also helpful when life takes unexpected turns.  A sudden job loss or unexpected medical bill can be easier to handle when you are financially organized.  Understanding all your income and expenses enables you to quickly see where you can cut back or shift things around to deal with challenging financial circumstances.

Celebrating Financial Milestones

The hardest part of saving for the future, especially things like retirement that could be decades away, is that it’s hard to imagine that far into the future.  It’s much easier to see how buying a new pair of shoes will bring you joy now, than how saving that (relatively small) amount of money into your retirement account can pay dividends in your future.  Set smaller, more achievable goals – your first $50,000 or $100,000 in retirement savings for example — and celebrate them!  Throw a student loan or credit card payoff party.  Being financially disciplined takes work and you should acknowledge and be proud of it.


Budgeting is not the most exciting topic, but it’s recommended by every expert because it works.  There is some work involved in creating a budget, but there are numerous tools available, whether apps or templates, to help you get started.  Once you create your budget, develop a process to monitor and update it regularly.  Taking these simple steps will go a long way toward creating a worry-free financial future.

If you are interested in learning about how I can help you take charge of your finances as a newly single woman, please contact me at  or schedule a free 20-minute consultation.

Sign up for Reset FP’s Monthly Newsletter to effortlessly stay on top of my weekly blog posts and occasional extra goodies and receive my Get Your Finances Organized Checklist for free!

Follow my YouTube channel for weekly videos covering a range of topics that will be helpful to you as you start to take control of your finances and adjust to your new normal.

Building the Life You Want – Starting with Your Values

Last week my kids had fall break and got a week off school.  We decided to travel from our home for the past two years in Arizona back to New Jersey where they were born and lived for most of their lives.  Our good friends were celebrating the bar mitzvah of their son, so it was a great excuse to travel back to see friends and family.

One of the things that my whole family misses most since our move to Arizona is the seasons.  And fall in New Jersey is really beautiful.  The air is cool and crisp but it’s usually sunny.  And the fall activities are in full swing, including apple picking, pumpkin patches and changing leaves.  Things we just don’t have in Arizona.

Apples, Friends, Nostalgia

We spent the week taking full advantage of all there was to enjoy.  We took the boys apple picking just like we used to do every September.  They ate apple cider donuts and visited the farm animals and loved it.  Honestly, our oldest might be aged out of that kind of thing at this point, but he still enjoyed going back to what used to be our family tradition.

We also got to see old friends.  Our friends.  Our kids’ friends.  People that had been like family through our early years of parenthood.  Seeing these people again was the hardest part.  This was the part that made my kids ask me why we moved.  Why did I make them leave behind friends they had known for years?  Friends that are part of their earliest memories.  Why can’t we just move back there?

We all experienced a little bit of nostalgia.  And a little bit of sadness.  And for a moment, I romanticized what our life was like living in New Jersey.  I thought maybe we could move back and maybe that would be better for my kids.  Maybe we would be happier in our old neighborhood, with our old friends, in a life that was familiar.

Traffic and Values

And then something magical happened: a traffic jam.  We were sitting in bumper-to-bumper traffic for over an hour just to get to dinner with my in-laws.  Why, you may ask, was this magical?  Because it made me remember why we moved.  We didn’t move because of traffic exactly.  Although I do remember many hours sitting on that same road on my way into my old job every morning.  I remember having full on ugly cry meltdowns while I sat, literally for hours sometimes, just trying to get to work.  Nothing about that was pleasant and nothing about that was aligned with my values.  But there was more to it.

A Rat Race to Nowhere

There were also high taxes, a demanding career, and running on a hamster wheel to nowhere in a race I never signed up for.  From the moment we moved to the East Coast in 2003, I was thrust into the world of finance in New York City.  Lots of people in that part of the world work in finance.  It’s a demanding field where things like work-life balance are laughed at or ignored.  It’s all consuming. 

And if you don’t want to play by the rules there are droves of people in line behind you who would love the chance.  I played the game.  I missed holidays, events, and life milestones so I could be in the office.  All so I could have a career with a great income that looked good on paper but left me empty inside.  All so I could pay the taxes on the right house in the right school district and pay the nanny to be there for my kids because I was not.  And I did it for a decade and a half.

Success Isn’t Success Without Values

In this day and age, it is almost impossible not to compare yourself to others.  Instagram is filled with posts of well-dressed children sitting quietly in beautifully decorated homes and LinkedIn tells you every time anyone you ever worked with gets a promotion or a new job.  Having the highlight reels from other peoples’ lives foisted on you at every turn can make you feel like everyone has it all together and you are the only one who can’t do it all.  I was no exception to this.  I kept seeing friends and acquaintances do things, achieve things, and create things that I thought I should be able to do too.  But no matter how I tried to fit into someone else’s version of success, it never worked.  Because their successes were not in line with my values.  And so, to me, they did not feel like successes.

Some of my core values include health, family, and flexibility.  Nothing about our lives during this time was aligned with those values.  I couldn’t attend events at the preschool or volunteer in my kid’s school library.  Or do any of the things that I wanted to as a mother.  And forget health.  I sat at a desk for 12 to 15 hours a day before the several hours of commuting.  There was no time for exercise, or silly things like doctor’s visits.  There were no sick days or downtime, there was just work.

And I was miserable.  Before I learned about the importance of values, I spent many years, very unhappy and looking for a solution.  I changed jobs, changed careers, changed houses.  I tried therapists and coaches.  I looked for mentors who had similar lives to try to figure out the magic of how they were making it work.  Nothing helped.  Because no matter what I did, I wasn’t any closer to living a life that was based on my values.  What I didn’t understand was that it didn’t matter what other people did because other people don’t value the same things that I do.

Aligning with Our Values

We moved so that we could live in a place that was more aligned with our values.  A place where we could live each day focused on what brings us the most joy and satisfaction.  We moved because I believe that living in alignment with your values is the key to satisfaction and happiness in life, even when it is hard. 

In this new place, everything is easier.  My husband and I both have the time and space to be there for our kids in the way we want and to pursue our personal interests.  We are no longer running in place, trying to keep our heads above water.  While we do miss friends and family, we won’t be moving back anytime soon.  We are building our life on our terms.  We will cherish visits back to the East Coast and time with family and friends, but for our family we are right where we need to be.

If you have read this far, thank you for the free therapy session.  My point in sharing all of this is to tell you that I practice what I preach.  I don’t just preach defining values to my clients, I live by it in my own life.  I spent over a decade looking for something to make me happy.  But until I understood my values, I couldn’t find it.  Now I don’t make any major life decisions without thinking about how each option aligns (or not) with my values.  And I can tell you firsthand, my happiness and life satisfaction has never been higher.  You too can use the challenges you are facing as an opportunity to define what you want your future to look like and then go build it.

If you are interested in learning about how I can help you take charge of your finances as a newly single woman, please contact me at  or schedule a free 20-minute consultation.

Sign up for Reset FP’s Monthly Newsletter to effortlessly stay on top of my weekly blog posts and occasional extra goodies and receive my Get Your Finances Organized Checklist for free!

Follow my YouTube channel for weekly videos covering a range of topics that will be helpful to you as you start to take control of your finances and adjust to your new normal.

Invest with Confidence: Mastering Investment Fees

If you have just started managing your own investments for the first time in your life, it can be overwhelming.  The investment industry has a lot of jargon of its own and it can be confusing if it’s not something you ever learned.  However, you can manage your investments and it’s not as difficult as you may think.  There are a couple of important concepts to understand when it comes to managing investments.  

We have reviewed asset allocation and diversification in recent blog posts and today I will cover investment fees.  In this post, I will discuss the various kinds of fees that you can be charged related to your investments and how to ensure you are not paying more than you need to.  Understanding fees, in conjunction with asset allocation and diversification, will help you start to manage your investments with confidence.

Why Understanding Fees Matters

It is important to understand how fees are charged on your investment accounts as there can be multiple layers of fees and they are not always transparent.  If you don’t know where to look for fees you can end up paying thousands of dollars that you don’t need to and that will hinder your investment growth over time.

In my experience as an advisor, most people have no idea how much they are paying for their investments.  I have had countless prospects who are working with advisors at other firms tell me they don’t know how much they are paying in fees or don’t think they are paying anything.  If you are working with an advisor, the advisor must be getting paid somehow.  Whether they are charging you explicitly or getting compensated behind the scenes based on products they sell you, rest assured they are being paid.  Even if you are investing on your own, there are fees related to your investments and they can vary widely.  You need to understand how to find them and how to control them so that you don’t pay more than you need to.

Common Investment Fees

There are several ways that you can be charged for your investments, and they can be layered.  The primary kinds of fees include:

  1. Expense Ratios
  2. Transaction Costs
  3. Advisor Fees

Expense ratios are fees charged by mutual fund companies for investing in their funds.  As discussed in my blog last week about diversification, mutual funds can be an efficient way to diversify your portfolio without having to research and buy thousands of different investments, however there is a cost related to this convenience.  Mutal fund expense ratios are not explicitly charged to you in a bill, rather they are built into the fund.  It would be great if there was a standard expense ratio, but fees can vary widely so it’s important to check the expense ratio before purchasing a specific fund.  If you look up the fund’s page online, you should be able to find the expense ratio.  I have included an example below from the Vanguard International Stock Fund, where you can see that the expense ratio is 0.11%.

Transaction costs are another type of fee you can be charged.  A transaction cost is a fee that you are charged every time you buy or sell a security or fund by the company that is completing the trade for you.  These kinds of fees have come down in recent years and have even been eliminated for certain types of securities at certain companies.  Again, this is something that you should easily be able to find by looking at the website of the firm where you are holding your investments.  They should clearly outline what fees they charge for what kinds of trades.  Keep in mind that there can be fees for both buying and selling.

Finally, you want to consider any advisory related fees.  This could be for working with a financial advisor or a robo advisor and can be charged in a variety of ways.  In some cases, advisors are compensated by selling you certain investments and then getting paid by the company that issues the investment.  In this case, you will never see the fee directly, but it is built into the cost of your investment.  However, the advisor should be able to tell you how they are getting paid and in what amounts.  Other advisors charge the customer for their services directly.  This is generally done as a percentage of the assets the advisor is managing for you and should be visible in your statement.  Again, the advisor can tell you what the percentage is and how it is paid.  Keep in mind that advisor costs are generally in addition to transaction costs and expense ratios. 

How Fees Impact Your Investments

As you can see, there are multiple layers of fees you can pay.  And those fees add up.  Expense ratios can range from 0.03% to well over 1%.  Advisor fees vary as well but are generally in the 1% – 1.5% range.  While 1 – 2% might not sound like a big amount, it can result in hundreds of thousands of dollars less in your pocket over a lifetime. 

Using a simple example where markets return 10% a year each year (which they generally have on average), if you invest $10,000, it will grow to over $340,000 over 40 years.  However, if you are paying 2% of your return in fees, you will effectively earn 8% per year and your portfolio will only be worth around $172,000 at the end of that 40 years.  Not paying attention to the fees you are paying can have a drastic impact on how successful you are as an investor.

Strategies for Fee Management

The first step in managing your investment fees is understanding them.  As we have discussed, there are several layers of fees that can exist with investment accounts, and you need to fully understand each.  Once you understand where the fees are hiding, you can take steps to reduce them. 

Many of the larger brokerage firms have drastically reduced or eliminated transaction fees, especially on their own products (i.e., it’s free to trade Vanguard funds at Vanguard and Schwab funds at Schwab).  Be aware of this and try to buy funds from the same company where you hold your accounts.

Even if you are buying funds from the company that issues them, they will still have expense ratios.  Make sure you research the expense ratio before you buy any fund, and always look for less costly options.  Index funds tend to be very low cost.  You can find funds with expense ratios that are between 0.03% to 0.25% which would be at the low end.  Contrast this with active funds that can have expense ratios of 1% -2% or more.  Choosing passive index funds will keep you at the lower end of this range.

Finally, make sure that you understand the fees being charged by any advisor you are working with.  Your advisor should be able to clearly explain the fees they are charging.  If they are not upfront about their fees, that is a red flag that you will want to be aware of.  Advisory fees are not necessarily a bad thing as a good advisor can save you tens of thousands of dollars over time by helping you avoid mistakes, but you do want to understand what and how you are paying for the services.

Taking Control of Your Financial Future

Now you understand how fees can impact your investment strategy and how you can manage your fees.  Combine this knowledge with what we have learned about asset allocation and diversification, and you have a good understanding of the basics of investing.  With this knowledge you should feel confident moving forward and starting to manage your own investments.  And if you still feel like you need more help, you can reach out to a qualified advisor to guide you.

If you are interested in learning about how I can help you take charge of your finances as a newly single woman, please contact me at  or schedule a free 20-minute consultation.

Sign up for Reset FP’s Monthly Newsletter to effortlessly stay on top of my weekly blog posts and occasional extra goodies and receive my Get Your Finances Organized Checklist for free!

Follow my YouTube channel for weekly videos covering a range of topics that will be helpful to you as you start to take control of your finances and adjust to your new normal.

Invest with Confidence: The Power of Diversification

woman diversifying investments

If you are new to managing your finances, it may be daunting at first.  The industry is teeming with complex terminology, making it less than straightforward.  However, rest assured that it’s achievable and less complicated than you might imagine.  There are a couple of important concepts to understand when it comes to managing investments.  Last week we reviewed asset allocation and today I will cover diversification.  In this post, I will discuss what diversification is, why it matters, and how to implement it.  Understanding this important concept will go a long way to making you a better investor.

What Is Diversification?

At its core, diversification is following the adage: don’t put all your eggs in one basket.  If you invest all your money in one company, and then that company goes out of business, you lose all your money.  Think back to companies like Enron or Lehman Brothers.  They went from being stable, successful companies to being out of business virtually overnight.  If you spread your investment across dozens, or even hundreds of companies, the likelihood they all go out of business (or perform terribly) at the same time is considerably lower. 

Why Does Diversification Matter?

The reason that diversification is so important is that it reduces the risk of investing.  You are still able to benefit from company growth, but you significantly reduce your risk by spreading your funds across several companies.  Not only is it unlikely that all the companies you invest in will go out of business, it is also less likely that different sectors of the market will drop at the same time.  For example, you may like investing in technology companies like Microsoft, Google, and Apple because they have done well in recent years, or you work in that industry and are more familiar/comfortable with it.  You may think by spreading your investments across twenty Tech companies you are diversified.  And while that is certainly better than investing in only one Tech company, you are not really diversified.  For example, imagine a scenario where the government introduces new legislation that makes it harder for technology companies to do business and consequently causes their stock prices to drop.  That same legislation may not affect other industries (like healthcare or automotive) allowing those companies to continue to perform strongly.  By spreading your investments, you are reducing the risk of events that affect specific companies, specific industries, or specific geographies.

The Benefits of Diversification

Diversification is an important investing principle that will benefit you.  First, it lowers your risk.  The market fluctuates daily, but certain companies, industries, and geographies move differently.  By spreading out your investments you will see less impact from the ups and downs of any individual area.  This will lead to more stable and consistent returns over time.  Despite what seems like wild (daily) fluctuation, the overall US stock market averages a 10% return per year over time.  This has been consistent for decades!  Diversification also allows you to benefit from whatever is doing well over a period of time without being overly impacted by companies that aren’t performing as well.  It is impossible to predict what the best performing company in any year will be and it changes over time.  By spreading your investments, you will be able to get the benefit of whatever performs the best without undue risk.

Implementing Diversification

There are several ways to increase the diversification in your portfolio, including diversifying across:

  1. Asset Classes
  2. Geography
  3. Sectors

Asset classes are the various investment options including stocks, bonds, and real estate most commonly.  As I discussed in my last post, you will want to include both stocks and bonds as part of your asset allocation.  Additionally, it’s important to diversify geographically.  This is generally done by investing in both US and international companies.  Finally, you want to ensure that your investments are spread across different sectors or industries, such as healthcare and technology.

If your head is spinning at this point, do not worry.  It’s not as complicated as it seems to ensure that you have a diversified portfolio.  Mutual funds and ETFs were created to solve this problem for investors.  The fund (or ETF) invests in a broad basket of investments, depending on its strategy.  You as the investor just buy the fund (or ETF) and you get all the benefits of diversification without having to research and manage hundreds of individual investments.

Monitoring and Rebalancing

Like asset allocation, diversification is not something you can do once and then ignore forever.  Different segments of the market will grow differently and will cause your portfolio to drift away from your goals over time.  As part of your rebalancing strategy, you want to ensure that you reset both your overall risk and your diversification periodically. 

Common Pitfalls to Avoid

There are a couple of common mistakes I have seen investors make when trying to diversify.  The most common is not understanding what is in various funds they are investing in.  There are thousands of funds available in the market with hundreds, if not thousands, of different strategies.  While you don’t have to research every holding in a fund, you do need to understand the general strategy and how it fits in with your overall portfolio to avoid these pitfalls. 

More Funds Does Not Equal More Diversification

I have seen many portfolios over my career that are invested in dozens of funds.  But when I ask about the strategy, it’s clear there wasn’t one.  Funds were just accumulated over time based on recommendations from friends or colleagues or news about the performance of specific funds.  Often these funds overlap or exclude entire sectors of the market.  Have a goal before you start investing and then pick specific funds that meet specific needs in the portfolio.  You can build a well-diversified portfolio that matches your risk tolerance with just a handful of funds.  More does not mean better.

Different Fund Issuers Does Not Mean Different Investments

There are many companies that issue mutual funds with lots of different strategies.  But there are many similar strategies that many companies duplicate.  For example, all the major fund issuers have an S&P 500 ETF.  You may think that buying the Vanguard S&P 500 ETF and the Fidelity S&P 500 ETF is spreading out your investment dollar.  However, both funds are invested in the exact same thing: the 500 companies listed in the S&P index.  Buying both does not increase your diversification at all.  Again, it comes back to an understanding of what the funds/ETFs you choose are invested in.

What You Know Is Not Always Best

One common hinderance to proper diversification is bias.  This often comes in the form of home country bias, i.e., being more comfortable investing in companies that are domiciled in the same country you live in.  I have also seen this as an industry bias.  For example, if someone works in healthcare, they may be more comfortable investing in healthcare companies and ignore other segments of the market.  While it is easier to invest in what you are more familiar with, this leads to concentration that you are trying to avoid.  You want to ensure that you invest across asset classes, geographies and sectors as previously discussed, not just across areas you are most familiar with.

Diversification is Key

In addition to asset allocation, diversification is a key concept you need to understand if you are starting to manage your investments for the first time.   At its core, diversification is spreading your investments across many companies, industries, and geographies to reduce risk and smooth out your investment performance.  You can create a well-diversified portfolio with a handful of mutual funds or ETFs if you have a good understanding of your goal and the underlying holdings in the funds.  Managing your asset allocation and your diversification will go a long way towards making you a successful investor.

If you are interested in learning about how I can help you take charge of your finances as a newly single woman, please contact me at  or schedule a free 20-minute consultation.

Sign up for Reset FP’s Monthly Newsletter to effortlessly stay on top of my weekly blog posts and occasional extra goodies and receive my Get Your Finances Organized Checklist for free!

Follow my YouTube channel for weekly videos covering a range of topics that will be helpful to you as you start to take control of your finances and adjust to your new normal.

Invest with Confidence: The Importance of Asset Allocation

If you haven’t managed your finances and investments before, it can seem overwhelming.  There is a lot to learn, and the industry is filled with jargon so it’s not totally intuitive.  But it is doable and is easier than you may think.  There are a couple of important concepts to understand when it comes to managing investments, the most important of which is asset allocation.  Asset allocation is simply how much you invest in stocks vs. how much you invest in bonds.  And it is the single most significant determinant of your investment returns. 

Why Do I Care About Stocks and Bonds

So why does it matter what you invest in stocks and what you invest in bonds?  Well, it has to do with risk.  Stocks give you the most opportunity for growth, but they are also the most volatile.  Meaning they go up and down in price, sometimes a lot.  One day, you might have a stock that is worth $20 and the next day it’s only worth $5.  Generally, the value of the stock is based on the underlying performance and value of the company that issues the stock.  But with our 24-hour news cycle and focus on the markets, headlines can cause a stock to go up or down (at least in the short term) in a way that is not justified by the underlying value.

Bonds, on the other hand, are a more stable investment.  With a bond, the company is basically borrowing money from you and paying you interest in return.  As long as you hold the bond to its maturity date (and the company does not go out of business) you will collect all your monthly interest payments and then get all of your money back at the end.  And there are even companies that review the financial health of bond issuers and provide credit ratings to investors so you can buy bonds only from the most creditworthy (i.e., less likely to go out of business) companies.

The Tortoise and the Hare

You might be wondering why you would invest in stocks if bonds are so much safer.  And the answer to that is: potential return.  While bonds are relatively safe, they are kind of like the slow and steady tortoise.  The interest they pay is based on the interest rate at the time the bond was issued.  While it generally beats the rate you are getting in a savings account at the bank, it’s never going to significantly grow your assets. 

Stocks, however, are more like the speedy hare.  A stock can go up 5, 10, 15, 20% or more in a single year (don’t forget – they can also go down by these amounts).  In fact, the average return of the S&P 500 (the 500 largest US companies) is nearly 10% per year over the past twenty years.  You want to have stock in your portfolio to give you the growth that makes investing so powerful.

As I mentioned before, your asset allocation will be the mix of stocks and bonds that you choose to invest in.  You frequently hear about the 60/40 or 70/30 portfolio.  In this language, the first number is the percent of your portfolio that is invested in stock while the second number is the percent invested in bonds.  The higher the stock number, the more overall risk in the portfolio.

The key is to determine the right mix of stocks and bonds for you, based on your specific goals, your timeline, and your risk tolerance.  So how do you determine the right allocation for you?

Assess Your Financial Goals

The first step in determining what your asset allocation should be is defining your short-term and long-term financial objectives.  Consider factors like retirement, education expenses for your children, and any other major life events.  Your investments are probably earmarked for a number of goals, all with different time-horizons.  If you don’t know what you are ultimately investing for, then it is impossible to determine the right asset allocation.

Time Horizon Matters

Depending on what you are investing for, you will have different time horizons and therefore different asset allocations.  For example, say you want to buy a house in two years, and you want to invest the money you are saving for a down payment until that time.  That would be considered a short-term goal and would require a conservative asset allocation.  Compare that with investing for retirement.  If you have ten, twenty or even thirty years before you plan to retire and start using your savings, you can have a more aggressive asset allocation because you have more time to let your assets grow and to recover from the market’s inevitable ups and downs.

Generally, anything under two years is considered short-term and should be very conservatively invested.  Time frames from two to ten years are intermediate and can be moderately invested.  While time frames greater than ten years are considered long term and can be more appropriately invested with a higher level of risk.

Risk Tolerance

Risk tolerance refers to how much risk you, as an individual, can handle.  This is different from person to person and is very emotional.  Clients often ask what their risk tolerance should be, but that is not a question your advisor can answer.  It’s something that is based on your personality and lifetime of experience.

While there is no one way to measure risk tolerance, you should try to understand whether you are more comfortable with investing risk or less.  One way to know is based on your reactions to financial news.  Assuming you hear that the market is going up or down, how likely are you to react and either buy or sell investments?  If you react quickly to the news, or lose sleep based on headlines, then you are likely less risk tolerant and should consider a more conservative allocation.  Alternatively, if you can ignore the headlines or feel comfortable with the ups and downs in the market, then you are likely more risk tolerant.  You are probably going to be more comfortable taking on more risk.

One caveat to keep in mind – your risk tolerance may change during times of transition. While you may not have been that worried about risk when you were married, now that you are managing things on your own, it’s possible that you are feeling more conservative.  That is completely normal and something you should honor.  Just listen to your instincts and adjust accordingly.

Regular Review and Adjustments

While you will want to determine your asset allocation when you setup your investments, your financial situation may change over time. Periodically review your asset allocation to ensure it aligns with your current goals and circumstances.  Additionally, as the market moves, so will your asset allocation.  If you don’t check-in and rebalance periodically, you can end up taking on much more (or less) risk then you want over time.  Make it a point to review your portfolio at least twice a year and make sure it is still aligned with your goal allocation.  It’s ok if it’s within 5% of your goal, but anything beyond that and you will want to rebalance to bring it back in line with your target allocation.

Your Allocation is Key

Determining the appropriate asset allocation will go a long way to helping you be a successful investor.  Asset allocation determines over 90% of the returns of a given portfolio.  As such, you want to make sure that you have the right allocation for you.  You can determine the right allocation for you by considering your goals, time horizon and risk tolerance.  And don’t forget to check in periodically to make sure things are still where you want them to be.

If you have any questions or would like personalized assistance with your financial planning, please don’t hesitate to reach out. Your financial well-being is our top priority.

I Am a Professional Woman, but I Know Nothing About My Money

“I am an educated, professional women, how do I know nothing about our finances?”  I hear this all the time from clients and prospects who are suddenly forced to start managing their own finances when they find themselves single again.  Women have made so many strides in the workforce in the past few decades, with more women now graduating college then men and many more women holding the status of breadwinner in their relationships.  So how is it that so many women still don’t act as the primary financial manager in their marriages?

What I Know as a Business Owner, Wife and Mother

I have a theory, based on my own life experience and absolutely zero scientific research.  And the theory is this.  Balancing a career and kids and your home and your marriage is HARD.  My kids are in their elementary/middle school years, and I have worked full time for their entire lives.  It’s a lot.  I have a supportive husband, who does a lot to help in the home, but he also works full-time. It’s a lot. 

There must be some sort of division of labor.  And many men feel comfortable with the finances (whether they have any qualifications to do so or no) so they take it.  It’s not that women can’t manage finances it’s that they need help keeping all the balls in the air and if finances are something their husband will sign up to manage, then so be it.

Growing up a child of divorce, I have my own money issues.  I watched my mom struggle for years to go from being a stay-at-home mom to having a career that provided enough to support herself and her kids.  I have always wanted to earn my own money and for a long time I kept my money separate from my husband’s. 

Life Gets in the Way

But then things got complicated.  I had a demanding job that required me to be in the office late into the night, every night.  My career was thriving, but I didn’t have time to deal with things in my personal life.  My husband had a more flexible job and more time to deal with things outside work.  So, he took over our day-to-day financial management.  And it has remained that way for over 15 years. 

I have no idea when our bills are due or how to make the electronic payments.  I can tell you every birthday party my kids are invited to this month and if we have purchased gifts yet or not.  I can tell you what my family is having for dinner every night this week.  But I cannot not tell you where you would find our water bill.  Or the name of the company that provides our water. 

Now in fairness, I am not totally in the dark as we do maintain a household budget with line items for all our expenses.  We both look at it together at least every few months.  So, if something happened, I could use that to figure out what I needed to take care of.  And I do manage all our investments, because…well that is what I do all day so it’s kind of a no brainer.  But I could easily see him handling that too if I was in a different profession.

Disturbing Data to Back My Theory

There is some research that supports my theories.  In UBS’s 2023 Own Your Wealth Report (which you can find here), there are a number of data points illustrating my idea.  When women are the primary earners in their relationship:

  • 55% say they handle the majority of the childcare
  • 52% most of the laundry
  • 51% most of the cleaning
  • 48% say they handle the majority of the financial planning

Turning the tables to look at relationships where the husband is the primary earner:

  • 31% say they handle the majority of the childcare
  • 34% most of the laundry
  • 31% most of the cleaning
  • 78% say they handle the majority of the financial planning

Whether men are the primary earner or not, they still handle much of the financial planning and the minority of other household and child related tasks.  Although we have come a long way in equality, it’s still the case that women handle most of the housework and childcare, even if they are also earning most of the money.  We need help and we take it where we can get it.

This can work.  Until it doesn’t.  Like when a woman find herself suddenly single and realizes that she hasn’t been engaged in managing her finances in years, or maybe even decades.  This can feel overwhelming and create a lot of worry and stress.

Ok, So What Do I Do About It?

If this resonates with you and you are wondering how to avoid finding yourself in this position, there are things you can do now to start getting involved (without having to take over everything and add more responsibilities to your plate).  As a starting point:

  1. Schedule a monthly meeting with your spouse to go over the finances
  2. Work together on creating and managing a household budget so you are both clear on where things are (you can use tools like Mint or YNAB to make this easy)
  3. Create a document that lists all your accounts and where they are located so that in an emergency you can find everything

And if you are already in the position of having to take charge of your finances after not managing them in a while (or maybe ever), know that you are not alone.  Managing your day-to-day finances, or your investments, does not need to be overwhelming.  There are lots of resources available, including great sites like HerMoney (they also have a podcast) where you can go to learn more.  If you don’t have the time or desire to do it alone, that is where a financial planner can be an invaluable resource.  They can help you take charge, educate you or just take the whole mess right off your plate and take care of it for you.

Not knowing a whole lot about finances is a situation many women find themselves in.  It’s not that we are not capable of understanding, it’s that there are not enough hours in the day.  Hopefully we will continue to evolve as a society, finding ways to support women so they can have equal roles both at home and at work.  But until that time, hopefully the tips above are helpful as you think about how you can take more of an active role with your money.

What Drives My Money Behavior?

Have you ever wondered how your beliefs and attitudes about money are different from those of your friends and family? Probably not. But have you ever wondered how someone who seems to have similar resources to you is always out buying new stuff that you don’t think you can afford? Or conversely, how your friend who has a great job never wants to spend money on fun experiences or nice vacations? Likely you have. Behavior with money is driven by beliefs and attitudes, which may be very different from one person to the next, even if those people have the exact same amount of money. Yet these beliefs are not something most people spend time thinking about, or are even aware of. They are formed over the course of your life and can be based on experiences, cultural norms and observing those around you (like parents and grandparents).

Although talking about money is taboo in many families, you still learn a lot in your early years by watching how your parents handle money. And how they handled their money was probably shaped by things they saw their parents do. If there was financial trauma in the family history, that can be passed down through the generations without anyone realizing it. Additionally, cultural norms may have a strong influence on how your family handles money. In some cultures, public displays of wealth are admired and aspired to, while in others, it’s more important to share what you have with your community. The way you manage your finances today is likely shaped not only by what you have experienced over your life, but also by generations of people before you.

Interestingly, the same money experiences can lead to different outcomes in different people. For example, if someone grew up very poor but then gained financial security as an adult, they may scrimp and save, worrying that they could lose their job or experience another financial hardship at any moment. Conversely, that same person can become an extravagant spender, feeling that they deserve the things they couldn’t have as a child and ignoring the risk that their financial situation could change again. This can also be seen with people who grew up with lots of money. They can go on to be over spenders even if they no longer have those same resources, or they can feel shame about having more than others and not want to spend or display their wealth. While you may have grown up in the same financial situation as your siblings, you may all handle money very differently as adults.

Spending time thinking about your experiences with money, including what you learned from your family, can be helpful in understanding your current behavior. Are you focused only on enjoyment today, disregarding what your future needs might be? Or are you putting off everything you want today so that you can save for the future? In either case, being aware of what is driving you can be powerful. Armed with knowledge about your beliefs, you can learn to enjoy life today while also doing things that will set you up for a financially secure future.