By Jean Chatzky
Read by Jean Chatzky
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Ask successful women what they want from their money and they’ll tell you: independence, security, choices, a better world, and–oh yes–way less stress, not just for themselves but for their kids, partners, parents, and friends. Through a series of HerMoney Happy Hour discussions (when money is the topic, wine helps) and one-on-one conversations, Jean Chatzky gets women to open up about the one topic we still never talk about. Then she flips the script and charts a pathway to this joyful, purpose-filled life that today’s women not only want but also, finally, have the resources to afford.
Through Chatzky’s candid three-part plan–formed through detailed reporting with the world’s top economists, psychiatrists, behaviorists, financial planners, and attorneys, as well as her own two decades of experience in the field–readers will learn to:
HerMoney: An Introduction
Seven of us, all women, are at the White Dog Cafe, a restaurant in a West Philadelphia row house. It’s a place more vertical than horizontal, the benefit of which is that there are more nooks and crannies than you get at airy, cavernous restaurants, which means more privacy, more space to really talk.
We are of varying ages and stages, a single woman in her 30s who just bought her first home, a married mom of two in her 40s, three divorced women in their 50s (one of whom is remarried), a two-time cancer survivor in her 60s who just left a forty-year career to embark on a new one, and a 23-year-old in her first job who tagged along with her mom. We are racially and educationally diverse; most have been to college, others through the school of life, and some have multiple or graduate degrees. At the moment, we all work, though some of us have dipped in and out of the workforce over the years to care for kids, for parents, and for ourselves. And most of us have never met before tonight.
That, as it turns out, is a good thing. Because the topic at hand is not one you might feel comfortable discussing with your closest friends. We have gathered—at my invitation, I should add—for the express purpose of talking about money. I know from past experience (this is not my first rodeo) that generating conversation about not the nuts and bolts of finances (best credit cards, mortgage rates, allowances) but about money itself is hard. People are reluctant. Even the women I know well who will talk about most things to a ready listener don’t want to talk about this.
So here’s what I’ve done: I made sure everyone I invited understood that this was the activity for the night. I made sure the wine—or beer or vodka, but let’s be honest, mostly wine—was flowing. And I decided to treat it like a party game. With the help of several of my female colleagues, I came up with about thirty questions designed to spark conversation. Questions like:
• The money secret I’ve been keeping is .
• Did you have a financial wake-up call? What was it?
• I spend money because .
• Is it okay to hide money from your spouse (if you have one) or your partner in your underwear drawer?
I printed them out in a font large enough and clear enough that none of us would have to reach for our reading glasses, cut them into little strips of paper, put them in a Ziploc bag, and stuck them in my tote. At the gathering—which I’ve since dubbed a HerMoney Happy Hour—we went around the circle. Everyone, including me, pulled a question or two. And we just started talking. And talking. And talking.
Think for a moment about what it feels like to embark on a romantic relationship after a dry spell. That first touch and your nerves start to tingle. That first kiss and you’re thirsty for, well, more.
That’s kind of what it feels like to sit in a room with other women—women who are like you and not like you, kind of like you and not at all like you—and start talking about your money. It’s exciting. It’s empowering. It’s a little bit scary. But if you start giving yourself over to the experience, the result is that you end up wanting more.
That, it turns out, is a very, very good thing.
A NEW PARADIGM
A decade ago, I wrote a best-seller called Make Money, Not Excuses. Wrapped in pink, it, like other female-focused books of its time (Prince Charming Isn’t Coming, SHOO, Jimmy Choo!) was aimed at convincing women that it was time to step up and take control of our finances.
We needed to do this because—at least for the foreseeable future—we were going to underearn men, take breaks from the workforce to care for kids and older parents that would put us behind when it came to saving for retirement, and outlive our spouses by an average of five years. That meant 90-plus percent of us would be responsible for handling our personal finances, well, personally. There was no getting around the fact that we would all be better off knowing how to manage our money before a crisis hit and we had to do it on the fly.
And readers loved it. It hit the New York Times and Wall Street Journal best-seller lists. Women discussed it at their book clubs. They passed it on to their friends and daughters. They kept their dog-eared copies at the ready for reference.
But things have changed. And not just a little bit. Today, women have more money—some have much more, as I’ll explain in the pages to come—and though there is no denying that we are undergoing an important shift in real time in many of the workplaces across the country, marching to the drumbeat of Time’s Up and #MeToo, many of us are finally also fighting for and sometimes achieving the power to go along with it.
What has also changed is what we want to do with our money and what we want it to do for us. More than ever before, we are mindful of the fact that we can, intentionally, use our financial resources to create the world we want to create—and not just for us, but for our spouses, our family and friends, and the causes we want to support.
Today, although women earners continue to lag male earners on average, there are many who have zoomed ahead. About 38 percent of American women have already become the higher earner or primary breadwinner for their families. But that’s not the only demographic change going on. More than 50 percent of women are single—and many will stay that way, making them de facto heads of households in their homes. Add them in, and the primary breadwinner number soars to 60 percent.
And there’s no stopping this train. For every 100 men who graduated from college last year, 132 women graduated. Those college degrees will drive increased earnings—increased power—for women. Already half of all millionaires are women. Women also are poised to inherit 70 percent of the $41 trillion in intergenerational wealth transfer expected over the next forty years. (It’s not that parents prefer their daughters to their sons, by the way, it’s that longer-living women will inherit twice—both from their parents and from their spouses.) Over time, the wealthiest age group in America—people age 65 and over—will continue to become more and more and more female as the population ages.
The astonishing result: by 2028, women will control 75 percent of discretionary spending around the world and by 2030, 66 percent of America’s wealth.
A HORSE OF A DIFFERENT COLOR
Yet to take all of this additional wealth and simply plunk it into the financial playbook that men have used for decades doesn’t work because we are different. We want to use our resources to accomplish different things. We want to measure our progress in different ways. My friend the best-selling author Jane Bryant Quinn once famously said, “Money isn’t pink or blue, it’s green.” She’s right of course. But my years of research and experience also tell me that we, as women, view money through a different sort of lens. And that is why we need a different sort of book.
First and foremost, for us, the life we want to create is the target, while money is the tool that helps us achieve it. For many men, it is the other way around.
And there are other marked differences:
We are more concerned than men are about both economic and political issues and are willing to selectively throw money at them to create change. We are more concerned than men about the financial situations—and stability—of both our children and our grandchildren and ensuring a college education is in the cards for them. We are more concerned about leaving a legacy for our families and communities and the world. We are more concerned about using our money to help others. And we are more concerned about using our money to help ourselves—to ensure that we create a guaranteed income stream that will last as long as we do so that we can knock that one humongous worry (seriously, it’s so huge that a study from Allianz revealed more people are worried about running out of money than they are of dying) off our lists.
There are major differences in the way we experience money, too: According to the American Psychological Association, women are more likely than men to already have a great deal of stress in our lives. Those stress levels are on the rise and likely to manifest in both physical and emotional symptoms. And what tops the list in terms of stressing us out? Yup. Money. And, although research has shown that—despite the annoying mansplainers who say otherwise—women are not more emotional overall than men, we do tend to feel negative emotions more strongly. Many of these emotions—in particular, guilt and shame, anxiousness and embarrassment—are deeply tied to our finances.
Add these things up, and it’s understandable that many of us don’t feel knowledgeable enough to run our financial lives with both confidence and conviction. Too many of us still prefer to sweep all things financial under the rug. Or, if we don’t prefer to do that, then we do it anyway for a multitude of other reasons.
The good news is: We are ready to turn the page on all of that. According to a recent survey from Fidelity Investments, 92 percent of us want to learn more about financial planning, and 83 percent want to get more involved in our investments.
Even our perspective on risk seems to have shifted. In years past, research showed women to be more reluctant than men when it came to taking risks with our investments. That hurt us, particularly when money stashed into low-earning bank accounts could have been earning stock market returns. What we are now seeing is that the more women know about our money, the more comfortable we are taking appropriate risks. In fact, when Merrill Lynch did a study that controlled for age and lifestyle goals, the risk-taking profiles of women and men were not much different at all. What’s more, 85 percent of women believe that the historical benefits of taking risk (i.e., that it’s something you need to do to stay ahead of taxes and inflation and to grow your money for the long term) are here to stay.
With all that in mind, I decided to take another bite at the apple. Women with Money: The Judgment-Free Guide to Creating the Joyful, Less Stressed, Purposeful (and, Yes, Rich) Life You Deserve is a manual for today. It’s based not just on detailed reporting with the world’s top economists, psychiatrists and psychologists, behaviorists, sociologists, financial planners, accountants, money coaches, and attorneys (a lifetime journalist can’t change her spots), but with hundreds of real women who spoke candidly about their lives, their frustrations and fears, their hopes and dreams.
It’s also deeply personal: for me. At the risk of revealing my age (okay, it’s 54), I’ve now been covering personal finance for a quarter century. When I took my first job in this field, at Smart Money magazine back in 1991, I told my soon-to-be-boss I didn’t want to spend my days sorting out the minutiae of 12b-1 fees.1 He assured me that I could spend my days writing and reporting about people and their relationships with and interactions with money. And although I left that magazine long ago, I’ve kept his guidance close. What hasn’t changed is that I still believe that life is my topic. Money is the window through which I view it.
But in the last twenty-five years, I have changed personally. Life does that. I’ve had two kids. Gotten divorced. Lost my father. Remarried (and gained two more stepchildren, and now a daughter-in-law, in the process). Watched my mother remarry (and added three stepbrothers of my own). Worried as my children struggled. Cheered as they regained their footing. Teared up as they went off to college. Let the tears flow as one graduated and then moved across the country for work. Grew concerned as my mom and stepfather started dealing with the ailments that come with age.
I’ve also changed professionally. When you first met me, likely on the Today show shortly after my firstborn (now 24) turned 1, I was an employee. Today was my side gig. And while I wrote books and gave the occasional speech in my spare time, I also had a job. In an office. With benefits. About a decade ago, I became one of the more than six million Americans who start a small business each year. I hired my first employee. I shopped for health insurance and started a 401(k). Today, we’re still small but we’re growing. We launched a website called HerMoney.com. And I’ve proudly watched as the young reporters I hired out of college, taught, and mentored went on to Forbes, the Wall Street Journal, and NerdWallet and grew businesses (and families) of their own.
All of that combined experience has made me more conscious of the important role that money has played—and continues to play—in my own life. But, as a woman, it’s also made me more opinionated about the best ways to think about and interact with money in order to get it to produce the best results. Again, life—the life I want, you want, we want—is the target. There is absolutely no reason we shouldn’t have it. But we need a greater understanding of and comfort with money. Because money is the tool we use to bring it about.
So, that’s where this book is coming from. And this is the journey on which it’s going to take you:
First, we’ll take a guided tour of who we are in relation to our money. What we want from it. How our histories shape us (and how we can leave them behind if need be). Why money makes us so emotional and how it plays the role of an often uninvited third wheel in our relationships. We’ll come through Part I with a greater understanding of ourselves. That will enable us to take on the more tactical, practical challenges in Parts II and III with clearer eyes.
Next up, in Part II, we’ll look at managing our money to create the lives we want for ourselves. We’ll talk about increasing our earning power—getting paid what we deserve, starting businesses (or side hustles), and investing for the long term (and to make the impact you want in the world). We’ll take a dive into real estate. The security of having a place that is yours—and that is (eventually) paid for—is an important item on many of your financial checklists. We’ll get into how to make it happen and where it fits into your other financial priorities. And we’ll look at using our money in ways that bring us joy. This is not only allowed, it is encouraged.
Finally, in Part III, we look outside ourselves. (Yes, I know, we’re used to focusing on others before ourselves. You’ll note I flipped the script here. This is intentional.) We’ll focus on using our money to raise independent, confident kids (who actually launch) and send those kids to college. We’ll get into the issues involved in caring for our parents as they age. And we’ll wrap it up with a discussion of leaving a legacy—the imprint you want on the world.
WHAT I SAW AT THE REVOLUTION
Throughout, you’ll find yourself immersed in the stories, language, and experiences of the hundreds of women who opened up to me or one of my HerMoney colleagues by chatting with us on the phone, via e-mail, through social media, or in person with the purpose of informing this book. As we go through the chapters, you’ll meet them. I’ve changed most of their names, and, in a few instances, some identifying detail. But I didn’t change their words. I painstakingly transcribed hours of digital recordings to make sure I got them just right. Their words are their own.
As for my HerMoney Happy Hours,2 the one I hosted in Philadelphia was just one of many such evenings (sometimes afternoons; mimosas and brunch work well, too). We’ve met in a home in Marin County, California, a hotel lobby in Nashville, a conference room in NYC, a restaurant outside Phoenix, and many other places. And each time, as we wound the conversation down, the reaction was largely the same: This felt different. This was special. As one woman in Marin put it, it felt revolutionary.
Which takes me back to that gathering at the White Dog in Philadelphia, where I drew the following question out of the bag:
• Who can you talk to about your money? Who can’t you talk to? Why or why not?
|LISA||(50s, divorced, entrepreneur): That’s a really good question. Remember that movie, Regarding Henry, with Annette Bening. Her husband [Harrison Ford] was shot and couldn’t work, and one of her friends advised her: Never tell anybody you’re suffering financially. That vulnerability! I mean, I share everything—everything—really personal things with my best friends. But we’ve never talked about money.|
|CLAUDIA||(60s, married, author): This is a really unusual conversation. I do not talk about this. It’s taboo.|
|MONICA||(40s, married, TV producer): You know, that’s really true. I know some friends who are struggling. And maybe we talk generally about the expense of things. But we never dig in.|
|JEAN:||So, do you like it? Or will you never do it again?|
|CLAUDIA:||I’ve always felt, still do, kind of ashamed about how I’ve handled my money—or let my husband handle it. But I have to say it feels good to hear that I’m not alone with the things I’ve thought about or the things I’ve felt. It’s liberating.|
|LISA:||I agree. That’s what this conversation feels like. About having power in your financial life. I deserve to have power in that.|
We all do.
Let the revolution begin.
You and Money: An Exploration
What Do You Want from Your Money?
Our Money, Ourselves
Once upon a time I would have said money is my currency, and then I might have said time is my currency. Now I’m at the point where I’ve realized it’s not time that’s my currency, it’s contentment.
Originally, I would sacrifice my contentment in order to go to school and then work all the hours after school that I could. Later on, I started realizing time is precious and [thinking about] what my time is worth. If I wanted to do something, I would think: Well, is it worth that much money?
Now, I’m in my early 30s so [when I look at how I spend my time] is it worth me working more to earn more money I might not need compared to doing the things that I enjoy but making less?
—Natasha, 30s, New Jersey, single, editor and publicist
What do you want from your money?
Have you ever asked yourself that specific question? If not, you’re far from alone. Most of the women interviewed for this book didn’t have the sort of quick answer you’d have when responding to a query you’d been asked loads of times, like: Aisle or window? Or, how do you like your steak? They took a minute, sometimes more, to really think about it.
And the answers, when they emerged, shared an important thread. One of the things we heard over and over was that money is not an end in and of itself. It’s not about amassing money—wealth—just to be rich. Instead, when we stop and take the time to think about it, we have clear, detailed answers about how we want to use it to build the lives that we envision for ourselves, our partners, our families, even the world.
But before we can get to those things, we have to conquer the four Ss.
In 1943, a not-yet-famous psychologist named Abraham Maslow wrote a paper entitled “A Theory of Human Motivation” that was published in the journal Psychological Review. This was the world’s first look at his Hierarchy of Needs, which we’ve come over time to view as a pyramid. Essentially, Maslow argued that we have to satisfy the needs at the bottom of the pyramid—the ones that are tied to our survival, like food, water, and warmth—before moving to the upper levels, where we can focus on things like finding fulfilling relationships, doing work that makes us feel valued and accomplished, and achieving our full potential.
One after another, the women we interviewed told us that what they wanted most from their money is found on Level Two. Safety. Shelter. Security. Stability.
We want that feeling of knowing that we have landed somewhere that is solid and that no other person has the ability to remove the rock from under our feet. And many of us feel we have to lock that basic need down before we can allow ourselves to want pretty much anything else from our money.
That makes sense. If you’re in an environment where you feel secure and safe, comfortable and unthreatened, you’re more likely to be able to move forward in your relationships, career, and overall life. If you’re stressed because you fear an unpleasant surprise around the corner, not so much.
And when compared to men, we feel more insecure, more unsafe on a daily basis. This is not new. A few years ago, the Gallup Organization looked at how safe people feel walking alone at night in their own neighborhoods in 143 developed countries. Then they compared the answers of women to men. In 84 countries there were double-digit gender gaps—and high-income and upper-middle-income countries (like the United States) had some of the largest. In other words, if you’re living in a nice neighborhood, with a security system (or good dead bolts), your trusty pooch by your side and still feel frightened, it is neither a) irrational nor b) unusual.
What was interesting was the ways in which this Level Two quest manifested itself. For some, like Tracey, 30s, a lawyer in New York, it means a house, plain and simple. “We purchased our house before I got pregnant,” she says. “I wanted that stability.” Ariel, a 36-year-old antiques store owner from New Jersey, concurs. “Success is my home and what my home represents,” she says. “Money is the tool to get there.”
I can totally relate. When I got separated and then divorced, about a dozen years ago, I was laser focused on buying a house—and making it a place my kids would be comfortable and I could curl up and decompress when they were with their dad. I wanted cozy, with nooks to read and watch TV. I wanted warmth. Never mind that real estate prices were so high that even if I sold today, I wouldn’t get what I paid. (I went to contract in May 2005. The bubble popped the next year.) Renting would have made considerably more sense, and yet I wouldn’t even think about it. It had to be mine so that no one could take it away from me. In fact, when I remarried a few years later, I refused to let my new husband buy in. For me, it was enough to buy the house. For other women, the need runs deeper. They want to own it outright. Christine, 30s, a business coach from Kentucky, says one of her “big goals” is to pay off her mortgage, noting, “I think there’s something psychological about having that.”
The desire for safety popped up in other ways as well (making me think of when Julia Roberts presented a panoply of condoms to Richard Gere in Pretty Woman, telling him matter-of-factly, “I’m a safety girl”).
We heard a lot about safe cars. “My husband feels like there’s [a set of expectations] that this is where the successful people in our community live, this is the kind of car they drive. He gets caught up in that,” says Lisa, 50s, who runs a health and wellness business in Wisconsin. “I’m more concerned about safety features as I’m carting my kids around.” Riki, 40s, from Arizona, agrees. “My feeling is that it’s okay that I’m not driving a Ferrari, but I need at least a very safe car and a car that’s reasonably new,” she says, “which is why I lease all the time.” (Again, just for the record, I’m on the same page as both. I drive a Volvo—wait for it—station wagon.)
But there is also a large cadre of women for whom safety is even more, well, literal.
SAFETY = SAVINGS
The Merriam-Webster dictionary, editions of which have been published since 1828 (who knew!) has a veritable laundry list of meanings for the word save when used as a verb. Among them:
• To deliver from sin
• To rescue or deliver from danger or harm
• To preserve or guard from injury, destruction, or loss
• To put aside as a store or reserve
Forgetting the first (it was at the very top of their list, so I had to include it), for many women the safety and security that can come from money is best found in actual savings. As in money. In. The. Bank. Kathleen, 40s, a single mom from New York, explains:
It’s a huge feeling of safety for me to have money saved. In fact, I sold my apartment in Brooklyn before I adopted my son and ended up in the suburbs, and now I rent. And what I like about that is I feel strongly about hanging on to my money. I know it’s [not as smart as investing it would be] but I feel pretty uneasy at this point about money, and one thing that makes me feel a little bit better is seeing a balance in various—so called—safe places right now.
Heather, 50s, a literary agent in New York, has experienced a similar desire to hoard cash at points in her life where she was about to take on more risk in her career. “The first time I quit a big job, I needed
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