No Excuses! How Every Woman Can Be Financially Savvy
Who is responsible for the financial strategy in your home – and do you have one? Despite the increase in dual income households, many women still are not involved in their finances. When the unexpected happens, whether illness, divorce, or loss of a job, trying to track down necessary information can be overwhelming.
Starting a family is the perfect reason to reassess your goals and monetary health. Here are some tips to make sure you don't get caught off-guard.
Sit down and talk. First and foremost, regardless of who handles daily bills or investments, make sure you have a full list of accounts, key contacts, and passwords saved somewhere where you both have access. Consider a safe deposit box for documents like wills, insurance policies, tax returns, and mortgage paperwork. Set up regular times to sit down and walk through your finances.
How do you start that conversation? Pamela Matthews, a Chicago area Financial Planner with Ameriprise, suggests this:
Looking at the big picture is the best thing you can do to evaluate your money management. You likely have a lot going on financially, so take time to step back and consider what you're really trying to achieve overall.
Make a list of all your financial obligations and goals – from daily expenses to long-term plans. Then start prioritizing, being honest with yourself about the “need to haves” like retirement savings and “nice to haves” like tuition paid in full for your college-bound child. Also re-evaluate the products and policies you already have in place and ensure you're making the most of options like your employer's 401(k) match. Lastly, develop a contingency fund. Unexpected events are bound to happen, but you can minimize the risk that an event like an illness or divorce will jeopardize your financial security by having emergency savings in place.
Don't forget the app. Once you lay out your plan, don't save budgeting for once a month when you are paying bills. Make sure you are tracking what is going out the door on a day-to-day basis. The intensity of the tools runs the gamut:
- Programs like Quicken partner with the data you store on your computer.
- Back in Black provides your full financial picture from your phone, which can be synced across devices.
- WellSpent provides a simple, clean view of your spending without all of the extra noise.
- Level shows you how much money you have left to spend each month visually like a gas gauge.
Learn from the professionals. Getting financial advice doesn't have to be a huge investment on its own.
- Most banks have investment advisors free of charge who can recommend what kinds of accounts are most appropriate for your family's needs.
- Financial planners, like Matthews with Ameriprise, provide a number of services, from managing your investment portfolio to providing a picture of how varied levels of monthly savings would impact your long-term bottom line.
- Don't forget about your insurance agent. Joe Schneider of Allstate provides resources like his agency's financial calculator to help set goals. He discusses options like Personal Umbrella Policies, and most importantly, preventing disasters before they happen.
Schneider says, “My annual insurance reviews with consumers tend to place a greater focus on safety once they have children. For example, we talk about the risks in the home that may not be quite so obvious, such as ordinary household items like window blinds, button batteries, and cupboards. I also reiterate the importance of a family fire evacuation plan and overall fire safety in the home.”
- Check out what others are doing online. Budgets Are Sexy is a financial blog written by a father with a young family, who not only shares his net worth and goals, but also provides tips, ways to make extra money with his “side hustle” series, and covers the news in a way that is easy to understand.
Planning for your family's future does not have to be intimidating. The best time to start is now!
Who tackles the finances in your home? What tools have you found helpful? Let us know!