• Melissa Walton-Jones

Finer Finance Fridays #12


MONEY MATTERS! What do I wish I had learned about money, sooner? So much...money is power, money means independence, money is freedom, the ability to give more and help others in need, the ability to impact the next generation....... You've decided that you want to start your own business. You want to treat yourself, and go on a trip around the world. You want to go back to school and finish your degree or you want to earn an advanced degree. Well, none of that is possible if we’re not in control of our money or we don't learn from our money mistakes.

Sallie Krawcheck, Co-Founder & CEO of an women's investing site, says these are the Top Ten Financial Mistakes Women Make.

1. Letting your husband or partner manage the money without your involvement. Very 1968... and not in the cool, mod way. Few of us think we’ll get divorced or that tragedy will strike, but look around. It does. You don’t want to be learning about your financial situation while you’re in shock. 2. Signing your joint income tax return without reading it.This is the mistake that divorce specialists often cite. If tax returns are handed to you at the last minute with a “Don’t worry. Just sign it, honey,” don’t. You’re on the hook. 3. Using your husband’s or partner’s financial provider, even if you don’t really like / know / can’t stand him.(And he is usually a “him.”) Here’s a test: at your next joint meeting, how much does the advisor engage you / speak to you / look at you? If “he” spends most of his time talking to “him,” find your own. 4. Not asking for jargon to be explained. Don’t let politeness get in the way of understanding your finances. Research shows that both men and women are shy of asking for explanations of financial terms; even so, men still invest while women more typically won’t. (I agree: it’s hard to know which is the worse outcome. So please just ask the questions. It’s your right.) 5. Not taking into account your greater longevity in your (savings) investing plan. If you’re married, you’re likely to live 5+ years longer than he does. Does your financial plan take this into account, and your years without him? Even if both of you are “moderate risk” kind of investors, that means different things if you’re living longer. 6. Not buying life insurance AND long-term care insurance. Here’s a shocker: 70% of 65-year-olds will need some form of long-term care. And, again, we’re around for 5+ years longer than he is. BE PREPARED! 7. Making the “keep working / stay at home” decision based on incomplete information. This is an important decision, for many reasons. Some of them are financial. When women leave their jobs for two years, they don’t typically come back earning at the same level, but their salary can decline by 20%…or more. And they don’t get the raises they otherwise may have. The time away is time when you’re not contributing to your retirement plan and can be drawing down savings. The net of this can cost you more than you think. If you’re considering taking a career break, read more.

8. Not taking enough risk. We women tend to be more risk aware in our investing. While this may sound counter-intuitive, our longer lives – and the fact that we retire with 2/3s the retirement savings of men – can call for somewhat greater (but still prudent) risk taking, to earn a higher return. This is something that many women have to push themselves to do. 9. Waiting until a less risky time to invest“Gee, the market feels iffy.” Or “I feel like I need to get through that stack of reading on the markets.” There are many, many reasons to wait to invest. But timing the markets is almost impossible, even for people who do it full-time. Investing steadily over time helps to smooth out the market ups and downs…and is historically a vastly better alternative than keeping your money in cash. 10. Forgetting that your most important asset is…YOU!!! It’s not your stocks; it’s not your bonds; it’s you. And that means that the actions you take can have a significant impact on your financial profile. Thinking about yourself as a financial asset raises questions like: should you take the job in the riskier industry? if you insure your other important assets, should you insure yourself, through life insurance, through long-term care insurance? and what happens if you ask for, and get, that raise? So, what do you wish you had learned about money sooner? What do you have that you still need to learn? Are you investing? If not, focus on #s 1-7 and 10. Then ask yourself, why aren't you investing... Don't know how, what about investing in a class? Take the necessary steps to do what is in your best interest. Do you see anything else listed that you recognize or can relate to? What are you going to do about it? Remember, it's not the mistakes you've made in the past that hold you back from financial progress, it's how you learn from them and move forward!

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PROUDLY ENDORSED BY: OMEGA IOTA ZETA CHAPTER │ STATE OF MISSOURI │ MIDWESTERN REGION

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Soror Melissa Walton-Jones, Zeta Phi Beta Sorority, Inc.

2020 Candidate for Re-Election: International Tamias