Our quarterly catch-up calls with our financial advisor were not my finest moment. I found it very difficult to tune in and pay attention. Every time he would say “qualified assets,” I would drift off because I had no idea what he was talking about. And, I felt like a dummy for asking… again! This summer, I decided to get serious about money and figure out what we had, where it was and what we were doing with it, rather than—and I’m embarrassed to admit this—rely on my husband to make sure our advisors are taking the right steps on our behalf.
Money makes the world go ‘round, but it had been years since I thought about sunk costs or inelastic demand, so I started with Planet Money’s Summer School. It features eight short episodes that are easy and breezy, but do indeed cover the basics that you learned and forgot in Econ 101. You can even take the final and earn a “diploma.”
Women and Money
This episode of the podcast Everything is Fine will motivate you to care about your family’s finances and not leave it all to your spouse (ahem). The hosts Kim France (former editor of Lucky) and Tally Abecassis (filmmaker and podcaster) interview Sallie Krawcheck, founder of women’s investment firm Ellevest. They talk about how women are socialized to be intimidated by finance, common investing mistakes women make and how to think rationally about money. Every week or so this podcast has amazing women guests, so check out their other episodes.
Personal Finance 101
CNBC has a very basic guide, which I recommend for younger women who are just starting their financial journey. It covers budgeting, emergency savings and long-term goals. Because CNBC is a legit news outlet, no one is trying to sell you a dubious investment product, so for that reason alone, it’s worth a quick read. It was a little too basic for my summer goals, mostly because I’m old enough to have hit many of these milestones. I needed the next step, the how and why of investing.
Every large investment company’s website has resources galore. Start with your financial advisor’s website, but if it doesn’t get you up to speed, checkout some of these:
Investopedia and JP Morgan’s dictionaries are where I answered my basic questions like what is a qualified asset. (Qualified assets are pension plans and 401(k) plans that meet ERISA standards. Another vocab term: ERISA is the law that lays out the rules for retirement funds. Executive bonus plans and some life insurance plans are nonqualified—not bad, they just aren’t covered by ERISA.)
Every dollar you spend or invest is a vote for the kind of world you want to live in. Buying at a neighborhood store keeps your community vital; divesting from fossil fuel companies makes an environmental impact. Think about your values, and then make sure your investments support those values. The Case Foundation is a great place to learn about how you can make money and do good.
Money flows between generations and through families, and it’s a powerful force, so financial literacy means learning how to harness wealth wisely. We’ve all seen families where money (the lack of or too much of) becomes a source of conflict. One of my summer goals was to think about transparency and generational planning. I want our money to be a safety net under my kids that encourages them to take smart risks and be generous individuals, but doesn’t coddle them into doing nothing. The Thin Green Line by Paul Sullivan, who is one of my favorite finance writers (I actually have these now!), covers how successful wealthy individuals think about their assets and contrasts them with rich people whose lives are worse because they have money (e.g., the cast members of almost every Bravo reality show).
Mostly, financial literacy—like everything in life—is about paying attention and putting in the time: Read the monthly statements. Write down a list of questions before the meeting. Ask for more information on any strategy change the planner recommends. It’s not rocket science, but it is a good feeling to be engaged and know what we’ve got and why.