A recent New York Times article highlighted women over 50 years old and their fears about money, noting that large numbers of “smart, accomplished women … cast a blind eye to financial matters, especially those relating to later life.” Does that sentence make you cringe just a little bit? Then maybe you have something lurking on your money to-do list.
Life presents us with many unpleasant activities that we don’t enjoy, but we do them anyway. Cleaning the refrigerator and scheduling a mammogram come to mind. Why then, would we ignore something as important as our financial life? There are many possible reasons.
Some of you may live in households where the money tasks are delegated to a mate – often a male. Or, perhaps you made a few bad choices in the past and don’t trust yourself to make good decisions now. Maybe you simply find money confusing and figure that if you pay your bills on time, you are doing okay.
The reality is that most women will be financially on their own at some point in their lives, due to personal choice, longer lifespans, or shorter marriages. Add to that, when parents pass on women are usually the ones designated to deal with the estate.
So, what should you do?
First of all, realize that what you’re avoiding is probably not as bad as you imagine. And, the longer you put things off, the more they grow into that big hairy monster hiding under the bed that must be avoided at all costs.
Here are two examples from my client files* to inspire you to turn on the light, check under the bed, and make a plan. (*note all names have been changed for privacy.)
When Ginger’s father became ill, she stepped in to help her mom. Her mother asked her to take charge of his financial matters and paperwork so she could devote her time to his care. Her father owned a lot of stocks. The bad news was that they were scattered in nearly 30 small accounts. Ginger spent untold hours over the course of nearly a year to track everything down and have it moved to a single investment account. If her parents had taken steps to streamline and consolidate their accounts earlier, this task would have been unnecessary. The experience motivated Ginger to schedule an appointment with me to go over her own various accounts to be sure she was making wise decisions.
Arielle’s family was devastated when she died unexpectedly at the age of 42. Her husband, young kids, family and friends did not know how they would go on without her. In addition to the emotional trauma, Arielle was the one who took care of all the money matters in the family. Looking through her desk a few days later her husband discovered a folder he hadn’t seen before. In it were the following neatly organized lists:
- The family bank accounts, investment accounts and insurance policies.
- Login information for online bill-paying.
- Names and numbers of their lawyer, accountant, financial advisor, and the children’s doctors.
- Her will and information that included her wishes for her funeral and burial.
What a gift Arielle gave her family – they were able to deal with their emotional pain, without an additional financial crisis on top of it.
Are you ready to create your own financial plan?
Here are five simple steps to get you started:
1. Locate your most recent will. (You do have one, don’t you? If not, changes step one to “make a will.”)
How long ago was it updated? Read it through and see if it still reflects your wishes. Keep in mind healthcare power of attorneys need to be updated regularly to stay in sync with changing laws.
2. If you are married, schedule a regular “money date.” If you are single, schedule it with yourself. Start with something manageable such as these:
- Where are your bank accounts? Do you do direct deposit? Which bills are on auto-pay?
- Decide on a methodology to keep track of your inflows and outflows. Apps such as Quicken or Mint are helpful. Many people use spreadsheets and notebooks. The more you watch your cash flow, the more in control you will feel.
- Who is on your team? List names and contact information of all professional advisors such as legal, insurance, investment, and accounting.
3. Locate key documents including the deed to your home, life insurance policies, and annuity contracts. Let your loved ones know where your important papers are located.
4. Talk to your parents to find out where their documents are. Ask them to inform you of their wishes for end-of-life care and disposition of their assets.
5. Celebrate the small steps you’ve accomplished, and build on your momentum!
If you have been turning a blind eye to your finances, I hope my ideas and the examples in this article have helped reduce any anxiety you may have about your money monsters. You owe it to yourself and your family to be knowledgeable.
Are you ready to shine a light? Contact me for a free 20-minute phone consultation, and we can begin to tackle it together.
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