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Lauren's Blog

Lauren’s blog covers topics that impact your finances, your family, and your future. Is there a topic you’d like Lauren to tackle? We’d love your suggestions and feedback.

A little plain speak about investing

A little plain speak about investing

I’m continually amazed by the mixed messages that investors are hit with daily—mostly from the media, but the media is not the only culprit. At Klein Financial Advisors, American Century Investments is the manager for many of our fixed income funds (also known as bond funds). Of course, I pay close attention to their market commentary. In their most recent note, The Bull vs. Bear Battle in 2019, Rick Weiss, a skilled investment manager, writes that he’s “not predicting a recession this year,” but that he’s “taking note of some signals.” Yet, in the same section of their website, investment manager Cleo Chang presents a different view. “Let’s take the emotion out of [the volatility],” she writes, “because we often get too caught-up in the real-time emotion of market selloffs.”  She then goes on to give facts and figures to support her perspective.

Here’s my take: Weiss is ‘mansplaining’ investments, while Chang is refocusing the attention on investors’ reactions. If that’s not a muddled message, I don’t know what is! This is a pervasive problem I see in the investment world. When I sit back and listen to the chatter around the table at investment committee meetings, the language and attitude about the markets, the economy, the Fed, and all the rest begins to sound more like a conversation about the Superbowl than about something as significant as investing for growth and security. It’s a problem that inevitably impacts the thinking of individual investors as well.

This past summer, I met with Ed. He and his wife Ann had been clients of mine for years. After Ann’s death in June, Ed was forced to take an active role in the financial planning process—something Ann had managed mostly on her own. In Ed and my first meeting one on one, it became clear that our work together would have a vastly different tone than my work with Ann.

As a key executive at a large corporation, Ed has participated in many investment committee meetings, and he has often sat through the inevitable ‘dog and pony shows.’ If you’ve never witnessed one yourself, investment committee meetings have a pretty standard agenda. The portfolio manager presents how the market performed in the past quarter, what their analysts predict will happen in the future, the status of your portfolio, and, last but not least, the “brilliant moves” they are planning to make your portfolio better than ever. Once they’ve offered their brilliant solutions, they welcome the audience’s brilliant questions—which usually sound something like this: Who do you think is going to come out on top? What is the Fed’s next move? How will the trade war with China/Canada/Mexico affect tariffs? (I always find myself wondering: if we were talking about a sports team, would the questions be any different? Everyone wants to know who will win the next game, what ‘management’ will do to improve their team’s odds, and what outside factors might impact their success. Same game, different playing field.)

At the end of my meeting with Ed, I asked what he would like to have more of in future meetings. Ed’s reply: he wants more ‘Weiss’ and less ‘Chang.’ In other words, he wants to talk sports. He wants the full dog and pony show, including charts, graphs, and prognostications so I can prove I am a ‘brilliant’ investment manager.

But why? Why play that game when I could be spending my time doing the right things to help him protect his financial security? Do I have market perspective, a high conviction portfolio, a deep understanding of economics and investment theory, a reliable investing process, a research capability, and the skill to employ these things to deliver a successful investment experience? Yes, I do. So why do I need to suit up, put on my game face, and sit in the press box to opine on the markets?

As an advisor, I get it. For certain investors, I have to to pull out my script and get to ‘work.’ Harumph. The last thing I want to do is talk about investing (to Ed, to you, or to anyone!) in an overconfident and condescending manner. If I need to demonstrate my investing chops, I prefer to do it in honest language. I’d rather show the projection of the long-term plan and walk through how that plan is structured to protect and grow assets over time. I’d rather focus on what matters most.

Another interesting thing about investment committees is that, in my experience, they are mostly (almost solely) attended by men, and so the language spoken there is inherently male oriented. Why? Do men really know more about investments, or are these meetings simply designed for a male audience—another symptom of the ‘good ‘ol boys network’ that has dominated the business world for years?

The March 2019 cover of Rolling Stone magazine features a photo of U.S. Congresswomen Jahana Hayes, Alexandria Ocasio-Cortez, and Ilhan Omar, along with House Speaker Nancy Pelosi. The title: “Women Shaping the Future.” The focus is all about the new and boldly female voices that are helping to lead the country. Perhaps it’s about time we start accepting new voices in the investment world as well and, indeed, inject a little plain speak about investing using language that's more than just talk.

I remember a time when news reporters were only men. Back then, the audience (me included) had a cognitive dissonance when listening to a woman’s voice reading news. Times have changed on TV news. Times are changing in Congress. Maybe one day soon, it will change in investment review meetings, too. I plan to be here to help make it happen.

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Facing divorce? Take these 5 steps to find your inner power

Facing divorce? Take these 5 steps to find your inner power

Anyone who has divorced knows how long and difficult the process can be. From the decision to divorce, through the separation and judgment, and on to the new normal, the process is fraught with details, meetings, and compromises. Divorce rocks your world, and a late-in-life or gray divorce disrupts decades of expectations and plans. The key to a successful transition—in divorce and other shattering experiences—is finding your power.

Easier said than done? Perhaps. But it can be done. Many wise women have gone through the transition and set inspiring examples of transformation. Their examples show us the way to move through change with grace and strength, and with our eyes laser-focused on building a happier future.

My friend Janet is one example. When she was in her late 40s, her husband walked out and left her with two teenage boys, a handful of unexplained debt, and her own recent diagnosis of MS. It wasn’t easy shifting from her initial rage at the situation to acceptance and, eventually, a good life for herself. But she did it. How? Armed with friends, family, professional advisors, and a skill at making lists, she broke down what she needed to do into small, manageable steps. The smaller the step, the better. Here’s what helped her find her inner power and take the first baby steps towards her new life:

  1. She got help from her closest friends.
    First, she reached out to her inner circle of friends. Sharing your reality can help you face the truth, and even your shame. Luckily for Janet, she had more than a few women ready to support her, including old college friends, other parents she’d met through her kids’ activities, and a circle of friends from her book club. “I was floored by the support they offered—not only from day one,” remembers Janet, “but for what seemed to me like the endless months that followed.” I believe women who have friends that are more than ‘pals who want to socialize’ are particularly fortunate. Our true friends can become our fiercest defenders, our most honest critics, and the people we can count on for a kind word or a strong hug. No matter how young or old you are, or how large or small your challenges may be, look around and treasure your circle of friends.

  2. She hired a (great) attorney.
    And not just any attorney. She found a family law specialist with skill, experience, and strength. He helped her achieve a fair settlement, wrote up the judgment, and then went the extra mile (or two) to follow up with all the post-judgment details. That’s where the magic happens. For example, the marital settlement agreement stated that the house was to be sold and the proceeds used to equalize the financial settlement, but with her ex on the title, Janet needed his signature to move forward. The ex tried to nickel and dime her in the transfer of assets. Her attorney stepped in to enforce the judgment and facilitate the process. (I recently sent him a personal thank you for using his “super powers” to help Janet with the most finite details. He was amazing!) That level of dedication and support made a world of difference.

  3. She hired a financial advisor who specializes in divorce.
    Yes, that’s me. (Though I was thrilled to learn that her attorney had made certain she was working with a good advisor… and a good therapist. He definitely gets it!) Together, we went through our financial checklist to be sure she was on her feet financially, taking care to break down each step into manageable, bite-sized pieces. I’ve been through my own divorce, and I know just how disempowering it can be. I also know how amazing it feels on the other side! An advisor who specializes in divorce can help you navigate the unique challenges of this transition—emotionally and financially—to get you back on your feet and moving forward.

  4. She tackled her cash flow.
    Janet had been a stay-at-home mom for more than fifteen years, so to begin to earn an income was a major hurdle. We immediately looked at her cash flow to identify what bills needed to be paid in the first six months and the resources on hand to cover them. Next, we looked at where she might live after the house was sold and discussed rent versus buy, and how much rent or mortgage was prudent. Cash management is the foundation of all financial decisions—whether for a pack of lifesavers or for real estate purchases. Knowing what resources would be available long term helped her gain her confidence and feel less like the whims of her ex were dictating her life.

  5. She looked beyond today.
    After a divorce, life starts anew. With any plan or journey, the starting point is precisely where you are today. Janet had a Gavron order, which meant that in a few years she would have to begin to earn a living. At the moment, however, her primary source of income would be spousal support, so she needed to insure that income via a life insurance policy on her ex. Together we looked at these and other important pieces of her financial puzzle, including updating her estate plan, deciding what kind of mortgage would be best, and investing her marital assets, as well as analyzing her income, protection, debt, and more. The millennials call all this holistic planning ‘adulting.’ After a divorce, gray or otherwise, ‘adulting’ starts anew with baby steps. Janet’s MS diagnosis required some specialized planning, so we made some assumptions about her health and her future. Step-by-step, the myriad details necessary to reestablish her financial future were addressed, and life went on.

A good two years after Janet’s divorce, she told me that she could remember the moment she began to feel confident and in control again. In her words, “I’d found my inner power that had been missing for years, and the moment I did, I could tell my kids could sense it too. Because when I’d found my power, they suddenly felt safe. That was the biggest payoff of all.”

If you are facing divorce, I urge you to take the first steps toward finding your inner power today. If it feels impossible or overwhelming, break it into smaller, manageable actions. One tiny action is to ask for help. Or tinier yet, decide you need help. You can build your new normal… step by step by step.

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Ageism, sexism, and staying relevant after 50

Ageism, sexism, and staying relevant after 50

Ageism is everywhere and is the most “normalized” of any prejudice. No matter how experienced you may be or how ideal for a job, once you hit 50, the possibility of being forced to leave your job long before you choose is all too real. And if you do find yourself out work, trying to find a new position can be a maddening process. For women of a certain age, ageism is exacerbated when a good dose of sexism is added to the equation. After striving—and succeeding—at building an ideal career, being marginalized and told that you’re no longer relevant may seem absurd, but in many industries, it’s a bitter reality that can put a serious dent in your sense of self-worth and your financial security.

My own story is just one example. After building a successful career in finance, my corporate job was eliminated. It was a brutal awakening that the path I had been paving for myself for years had ended. When I looked at things from the perspective of my employer, I had to admit that I got it. I realized that if my son Adam and I were being considered for the same job, I could see why they’d prefer hiring him instead of me. He had a hot-off-the-press economics degree. He had no family responsibilities (yet). He could tell better jokes and was a perfect candidate for the after-work sports team. Me? I had one thing going for me: I was great at my job. But in that environment the perception of potential trumped performance.

Like many in the same situation, I soon realized that finding a new position where I could do a similar job at equal pay was not going to be easy. Every employer out there was looking for an Adam—not a me. So I did what I had to: I learned to hustle. I learned how to do payroll. And taxes. And QuickBooks. I worked one day a week as a controller for a manufacturer, and two running someone’s tax office. I got certified as a CFP®. I became an Enrolled Agent. I found my passion for wealth management, and the rest is history. Yes, I persisted.

But as I said, my story is just one of many examples. At just 52, Liz has been searching for a new position for nearly a year after being laid off from the firm where she’d built a very successful career as an organizational leader. Whether it’s because of her age, her sex, or both, no one has offered her the type of role for which she’s qualified. At a time when she should be rapidly accumulating assets to fund her retirement, her financial reality is a significant setback. At 67, Nora would love to be working more, but she can’t seem to add clients to her roster. At 70, Delia is healthy, fit, and extremely accomplished, but she’s burned out after searching long and hard for a job that fits her skills and experience.

What’s most difficult for every one of these women is that each had planned to continue to work into her seventies. However, staying relevant and marketable is much easier said than done—especially for women. According to the AARP, while 72% of women between the ages of 45 and 74 think people face age discrimination at work, that was true for only 57% of men in the same age range. Is it fair? No way. But the only way toeliminate this brutal combination of ageism and sexism is to change the perception that women over 50 are declining or are any less valuable to the workforce than younger workers—both male and female.

The good news is that there are many older women who are actively proving that they aremore than capable of making highly valuable contributions in their fields. At age 72, Andrea Mitchell continues to be an active and important voice in journalism. The bona fide “Queen of Media,” Oprah Winfrey has been ranked as the most influential woman in the world. At 64, she’s showing no signs of giving up her crown. Meryl Streep and Elizabeth Warren are 69. Martha Stewart is 77. Nancy Pelosi is 78. All of these women continue to show us all just how relevant—and powerful—women of a certain age can be.

My favorite example (of course) is Ruth Bader Ginsberg. At 85 years old, RBG is known for her tenacity in a career dominated by men. When she broke three ribs earlier this month, she was back at work before she was even released from the hospital. Her commitment and ambition seem to know no bounds. But what about those of us who are not household names and are struggling to remain relevant? Here are three ways to stay in the game—and keep your bank account flush—no matter what your age:

  1. Own your ambition.
    Don’t buy into the old idea that it’s not “feminine” to be ambitious. (Whatever that’s even supposed to mean!) Take a lesson from RBG: a married Jewish mother, she began crashing through glass ceilings at 17 and hasn’t stopped since. Figure out what motivates you, set your goal, and go for it. No excuses.

  2. Acquire skills people pay for. 
    Whether you’re striving to maintain relevancy in your current job or trying to make a change, identify what skills you can add to the list of things you’re great at. Are you a born coach? Is accounting your thing? Could you be a great organizer or a business writer? Explore what sparks your interest and then find a way to improve your marketable skills and excel in your new field of choice.

  3. Keep hustling.
    Working into your seventies at a corporation may have been part of your master plan, but many older workers soon realize that the traditional path is no longer realistic. If that’s true for you, it’s time to jump into the “gig economy.” To see what types of services are in demand today, take a look at the listings on sites like Upwork, Guru, and Fivrr. To learn more about how to keep working in the new world of work, read my blog post Rethinking retirement in the “gig economy.” Don’t stop hustling until you choose to stop working on your own terms.


According to the American Institute for Economic Research, 82% of respondents to a recent survey said that they successfully transitioned to a new career after age 45. While some took pay cuts early on, about half saw an increase in earnings after “a period of hard work and persistence.” It can be done. As my friend Bobbie says, “ageism plus sexism equals sageism.” I love that! Embrace the sage in yourself and show the world just how relevant you are—at any age.

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Just for caregivers: 7 Dos and Don’ts to protect your financial future

Just for caregivers: 7 Dos and Don’ts to protect your financial future

Caregiving. It’s something I can speak to firsthand. When my late husband Ed suffered a severe stroke decades ago, I suddenly confronted a whirlwind of emotional, physical, and financial stress. It’s no wonder that I found myself having flashbacks when I read the results of a recent survey of 2,000 caregivers. The findings are frightening, but they tell a story that won’t surprise anyone who has been a caregiver for someone they love.

According to the survey, nearly three out of four respondents said that their personal financial situation causes them stress, and 92% said they help manage the finances of the person for whom they are providing care—from paying bills to handling insurance claims to dealing with debt. While struggling to manage another’s finances is certainly stressful, caregivers also tend to allow caring for a loved one to impact their own finances. Of those who help their family members financially, 30% said they’ve cut back on their living expenses to do so. Twenty-one percent have dipped into retirement savings. And 24% had trouble paying their own bills.

It’s a heavy burden. Financially and emotionally. The vast majority of caregivers—nearly 70% according to the National Center on Caregiving—are women. Since women as a group struggle more than men financially, this puts us in even greater peril to achieve financial security and confidence during our lifetimes.

I’ll tell you straight out that it is our giving nature—not our financial smarts—that puts us in that peril. My own story is a perfect example. There I was, a successful financial advisor, helping my clients make the best possible financial decisions. Yet, during Ed’s long disability, I was challenged by my new reality—being the sole earner while also being a caregiver. I was overwhelmed with the emotional side of the equation. As I was leaving the hospital to take Ed home, the case manager’s words filled my heart with even greater fear: “I guess it’s time to start spending down your assets.” And though I knew better, her chilling words cut me to the core. After all, my goal was to take care of my husband, but I was also a financial planner and swore not to put my financial security at risk.

Ed and I had been on track financially. Yet despite carefully managing spending (and feeling guilty every time I turned my focus to money), by the time Ed died, I had gone from financially comfortable to more than $80,000 in debt. Did I know what we were spending? Yes. But I simply couldn’t get myself to look at the numbers. As a result, I made some major financial missteps.

The good news: you can learn from my mistakes to avoid making them yourself. Here are my 10 “dos and don’ts” that can help every caregiver make better, smarter financial decisions—even when you’re in an emotional fog:

  1. DO recognize that your loved one may no longer have the ability to make wise decisions,financially or otherwise. Like caring for a child, you will need to make hard decisions—even when your loved one resists.
  2. DO have proper powers of attorney for healthcareand financial matters in place before a health issue arises—and use them when the time comes!
  3. DO have a written record and spending plan. Tracking expenses and knowing your budget is vital.
  4. DON’T confuse highest cost and what is best for your loved one. Consider the physical and mental needs of your loved one when choosing the best care option. A beautiful facility with extensive activities may not make sense for someone who is confined to a wheelchair or has advanced dementia.
  5. DON’T let your personal relationship with caregiver employees impact financial decisions. Be sure you’re paying the market rate for care, and maintain an arm’s length employer/employee relationship.
  6. DON’T give in to emotional blackmail.Make the best decisions based on your loved one’s current health and financial situation—not based on old promises to others or to yourself.
  7. DON’T neglect to keep your own financial house in order.Caring for a loved one can easily become your only focus, but caring for yourself and your future is just as important.

I learned the hard way what to do—and what not to do—when managing finances as a caregiver. Since then, I’ve focused my practice on helping women make smarter financial decisions, especially in situations when emotions can lead to disastrous results. One of the most important things you can do to help keep your finances afloat is recognize that your own emotional biases can lead to poor financial decisions—no matter how smart you are. To help stay on track, work with a financial advisor who can help you step back and look at the big picture.

As they say before every flight, in case of emergency, put your own oxygen mask on first so you’re able to help others. The same is true when you’re serving as a caregiver. By making your own financial security a priority, you can increase your capacity to care for your loved one—without sacrificing your own future.

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New parents: Know the true costs before choosing to stay at home

New parents: Know the true costs before choosing to stay at home

Gail Hicks is a senior financial advisor at Klein Financial Advisors. She is this week’s guest blogger while Lauren is away on vacation.

It’s a question almost every soon-to-be parent ponders: should I stay at home after the baby is born? And if so, for how long? Even for the most career-driven parent, it can be a very emotional decision. To come up with the right answer for you, step beyond a basic pros-and-cons list. Be certain you’re considering every piece of the puzzle before making a choice—and do all you can to be sure that choice balances your emotions with what’s best for the long-term financial stability of your family.

If you think that puzzle is a simple one, think again. It’s easy to look at the high cost of childcare and assume that those costs, combined with the savings on everything from dry cleaning to taxes to eating out after a long day at the office, make staying at home the most cost-effective option. That’s rarely the case.The truth is in the data. According to a recent study by the think tank Center for American Progress (CAP), the average 26-year-old woman who takes a 5-year break from her career will lose much more than five years of her salary. In fact, when considering lost income, wage growth, and retirement assets and benefits during just five years, she’ll lose a whopping $467,000 over her lifetime. A man of the same age will lose even more: just under $600,000. To make those numbers more personal (especially knowing that Orange County is one of the most expensive places to live in the US) assume that staying at home will cost up to five times your annual salary for every year you’re out of the workforce. According to the latest U.S. Department of Agriculture’s Expenditures on Children by Families report, households with income over $105,000 should be prepared to spend at least $400,000 to raise a child to age 18. With that price tag in mind, it’s a challenge to make staying at home an affordable option!

Of course for some parents, the math isn’t enough to sway the emotional desire to stay home with children. For others, there are family and cultural biases that strongly influence the decision. But it’s vital to look closely at the reality of your choice before opting to leave the workforce. As someone who has been there myself, I know the real-world challenges all too well.

When my husband and I were contemplating expanding our family from one child to two, we remembered the toll my job took on my health during my first pregnancy, including a very frightening pre-term labor that resulted in being put on bed rest at seven months. The high cost of childcare and the fact that we had no family in the area to help out were also factors to consider as we considered our options. We did the math (it’s what I do, after all!), and determined that with our savings and the extra income from my husband’s side business, we could make it work. We knew there would be sacrifices, but it was an important—and yes, emotional—decision for us both. So I walked away from a high-paying corporate job and walked into stay-at-home parenthood.

Unfortunately, the decision didn’t play out in real life as well as it had on paper. First, our second son was born with a mild disability. That alone tipped the financial and emotional scales. Jumping through hoops to get a diagnosis and then therapy two or three times a week was hard. Soon afterward, the recession hit, and with it came the end of the consulting income we had counted on to help replace my salary. Even worse, my husband didn’t want to add any more stress to an already high-stress situation, so he postponed admitting that his side business had completely dried up. Our plan of just breaking even quickly turned into the reality of taking on debt. Now the numbers didn’t make sense. How could I go back to work when my younger son needed me at home and my older son had grown accustomed to having me at home with him too?

At the same time, I was in a world of the unknown. I’d been a businesswoman my entire life. I was home with a special-needs child, I knew only a handful of my neighbors, and the few stay-at-home moms I was able to meet had never worked, so our experiences were completely different. I felt isolated and alone. And while it was a difficult choice to go back to work, money was just one piece of the equation. I was confident my choice would be best for our whole family, and it truly was. Within months of going back to work, I felt we had found balance again. Yes, I missed the time with my sons, but I knew I was a better mother when we were together as I watched the financial and emotional stresses wash away.

Everyone’s situation is different. The key to making the best choice for you is to understand the true financial impact of staying at home, and then to decide what makes sense for you and your family—both today and over the long term. How can you be sure your emotions aren’t overriding your common sense? Work with a professional advisor to help you crunch the numbers and be sure you’re really considering every piece of the puzzle.

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Are you ready to become an investing Wonder Woman?

Are you ready to become an investing Wonder Woman?

The new Wonder Woman movie broke every box office record last weekend, and critics and audiences continue to shout praises, calling it one of the most entertaining—and empowering—movies this year. I had a great time seeing it myself, and while I’m no critic, I thought it was the perfect summer treat: a big, noisy movie with a woman super hero. What could be better?!

But while yes, having the power to win the battle of evil in the “war to end all wars” would be pretty great, what I really wish is that I could give every woman Diana-level confidence in a superpower she already has today. That superpower, of course, is investing.

Here’s the great news for all you warriors out there: Another study just came out that showed that women are better at investing than men. That’s something to celebrate! As a group, we plan better, we take less risk, and (this should be no news to anyone!) we’re more patient—and these are all factors that add up to larger returns in the world of investing. But here’s the not-so-good news: we lack the confidence of Diana. Despite the data, women continue to see men as better, smarter investors. Among 1,500 women polled last December, only 9% thought women would earn a bigger year-end return than men. That’s a disconnect that matters. After all, if we don’t see ourselves as smart investors, how can we ever overcome the earnings gap and finally take control of our own finances?

Whether you’re one of the doubters or you have complete confidence on your investing skills, here are five things every woman can do today to become an investing Wonder Woman:

  1. Own the fact that you have the mindset to be a wise investor.
    Diana has the skills to fight evil. You have what it takes to be a great investor. Know this. Research shows that when women take the helm for our own retirement planning, we tend to be smarter, more levelheaded investors. And yet in most families, men have the trusted relationship with a financial advisor, while women take on the role of a “financial child” in the household. It’s time to take a different path. Trust that you have what it takes to make smart investment decisions, and talk to your advisor yourself to be sure your investments address your own needs and are aligned with your own values. And if you need to build up your knowledge of the basics, start with my blog post When did it become ok to be financially illiterate?
  2. Make retirement planning your number-one priority.
    Longevity is a huge issue for women. According to the Centers for Disease Control and Prevention, women can expect to live about five years longer than men. At the same time, between taking time off to care for children and our own aging parents, a persistent wage gap that reduces our take-home pay as well as our future Social Security payments, and a historically lower pay rate, we typically have fewer resources to fund our longer lives. That means it’s critical that you start planning for retirement as early as possible. While you may not be able to overcome some of the gender barriers that can haunt any woman’s account balance, the combination of persistence and compounding can help close that gap.
  3. Pay your future self first.
    If you’re like most women, it’s easy to put saving for retirement on the back burner. But let’s face it: there will always be bills to pay and extra expenses to manage. To be sure your retirement doesn’t get lost in the financial shuffle, work with your advisor to determine how much you need to save, and then set a schedule to pay yourself first—every month. The more automated your contributions can be, the better. And rather than feeling deprived, think of that savings as a “freedom fund” for your future self. A June 2016 studyshowed that 83% of women in the US aren't saving enough for retirement. Don’t represent that statistic! By being diligent now, you can create your own financial freedom—no matter how you choose to spend your time later in life.
  4. Make conscious decisions about 'image' purchases.
    As a professional woman and business owner, I know all too well how expensive the societal pressures can be for women to spend on our images. We are judged by appearances much more than men, so the cost of a wardrobe, manicures, haircuts, and more can take a very real bite out of every paycheck—which is already smaller than a man's. (Just ask Hillary Clinton, who has said she was thrilled to put away her makeup after losing her Presidential bid last year; I doubt any male candidates felt the same relief!) It's a double standard, and whether you are paying your bill at Nordstrom or the plastic surgeon, it all adds up. Remember: your image is important, but that doesn't mean you need a Prada suit to look your best. Decide which purchases are necessities, which are optional, and be honest about what you can really afford.
  5. Fight like a superhero for equal pay!
    Women still earn less than 100% of a man’s dollar, and that will likely never change without pay visibility. For decades, corporations have promoted a culture of secrecy about pay. This reality puts women and minorities at a distinct disadvantage. After all, how can we advocate for ourselves if we don’t even know what our co-workers earn? By removing the taboos around pay transparency, we can end this inequality once and for all. At the same time, we need to start placing a real, tangible economic value on caring for children and aging parents—work that is largely taken on by women. By offering benefits such as disability insurance, health insurance, and Social Security credits for this very real and necessary work, we can finally begin to recognize that the care being provided is a valuable part of the fabric of our community and our society as a whole.

Women can be great investors, but our mindset alone isn’t enough to change our trajectory. Just like Diana, Princess of the Amazon, we need to take real action. We need to see ourselves as the smart investors we are, focus on saving for our own futures, and balance our need to create a great image with our need to gain a greater financial advantage. And we need to fight the good fight for equal pay—even if it takes Diana’s God-killer Sword and Lasso of Truth to spur on salary transparency! Lastly, even Wonder Woman counts on the rest of the Justice League to help her succeed. Find a team you trust, and start taking control of your financial life today. Your future self will thank you for taking your job as an investing Wonder Woman seriously—no shield required.

Photo: TM © 2017 DC Comics

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Closing the financial gender gap

There’s a downside to specializing in financial planning for women. While I take great pride in the fact that I spend much of my time helping women build financial confidence and create stronger financial futures, my job can get seriously frustrating. Why? Because no matter how much the gender gap is mentioned in political speeches, and no matter how wrong we know the disparity is, it doesn’t seem to be going away any time soon. According to the American Association of University Women’s recent report “The Simple Truth About the Gender Pay Gap,” women earn an average of 79 cents to the dollar compared to men. Women of color and older women fare even worse. In other words, 79 cents is the best-case scenario, and it’s a pretty bad starting point.

When it comes to saving, this earnings gap is magnified. With lower earnings, women have 20% less discretionary income available for saving. Less savings means women are less prepared for retirement, less able to retire as early as men do, and often have less retirement income even when they do stop working. The result: a shorter, less comfortable retirement. It’s no wonder women tend to suffer from “bag lady syndrome,” that less-than-pleasant term for the fear of ending up penniless and homeless. And while it may sound extreme, this fear is very real for far too many women.

Of course, the gender gap isn’t the only dynamic at play here. Women—particularly baby boomers and older—were raised with the idea that a solid financial “plan” meant finding a reliable man to provide financial support, and maybe getting a teaching credential just in case. To find a husband, women often spend their limited resources on presentation (clothes, makeup, hair, nails, and more) in hopes of attracting their financial security blanket. While younger women may scoff at the idea, in reality, the myth that men are some sort of financial guardian for women is still alive and well. Perhaps even worse, women tend to hand over the financial reins to their male partners, often hiding their heads in the sand when in comes to money. It’s a dangerous way of thinking. It taints our relationship with money, including our ability to be financial grown-ups and a full economic partner. It inhibits our financial confidence, and it limits our ability to take charge of our financial health and close the gender gap once and for all. 

My client Lydia is a great example. When her husband Jim died seven years ago, figuring out how to transfer assets and how to invest the money was the last thing she wanted to deal with. Jim had always handled the money, and she felt lost in this “whole new world” of financial planning. Jim’s stockbroker offered to help by rolling Jim’s annuity into a new one. When Lydia signed the agreement, she didn’t understand the surrender charges on the new annuity or even what she was signing. The broker played the role of helping the grieving widow well while he captured a hefty commission for himself. Lydia came to me when she sensed she’d been betrayed. Luckily, we were able to unwind the transaction, and since then she’s become educated and financially empowered. I only wish she—and many women like her—had never been in the situation in the first place.

Whether a woman is married, divorced, widowed, or single, I believe half the battle in closing the gender gap is changing our attitudes about money. The gender pay gap has barely budged in more than a decade, so it’s likely to be with us for some time, but here are six ways we women can do our part to help change the game:

  1. Be financially self sufficient in your marriage or any relationship.
    I can’t tell you how many women I’ve worked with who “trusted” their partners to do right by them and were bitterly disappointed. Take equal responsibility for your financial health. Remember: building your financial future isn’t anyone else’s job. It’s not your husband’s job. It’s not your advisor’s job. It’s yours.

  2. If the bottom line goal is to create wealth, make erasing debt your #1 priority.
    If bringing home 21 cents less then men for every dollar you earn makes you mad, consider this: If you have $5,000 in credit card debt, you could be paying as much as 40 cents more on every dollar you spend. Consumer debt compounds negatively, drags on your wealth, and strips away your ability to “outsave” men. Do everything you can to eliminate the debt you have today, and be realistic about spending to be sure it doesn’t creep back up in the future.

  3. Invest in yourself.
    Make financial choices that increase your earning power. Learn new skills. Get your MBA. Earn a professional certification. (Note: “Investing” in Botox, designer handbags, and little dogs are not part of this plan!)

  4. Invest early and often to take advantage of compounding.
    The more your money has time to grow on its own, the more wealth you’ll have to fund your retirement. Start as soon as possible and increase the amount you invest and save each year. If you get a raise, save half of it and spend the rest. 

  5. Getting divorced? Hold on to assets that generate long-term wealth.
    While you may feel emotionally attached to your home, a house is not an investment asset. Focus on retirement funds and other savings vehicles that can produce income 20 years down the road.

  6. Maximize your Social Security benefits.
    With lower earnings, it may be tempting to start claiming Social Security as soon as you're eligible, but delaying your claim just eight years from age 62 to 70 can increase the value of your benefit by as much as 76%. For women, that pay raise can do wonders in helping support a longer lifespan.

I hope the gender pay gap will someday become a thing of the past. Until that happens, make it your mission to change the things you can control. Get educated about financial planning, take responsibility for your financial future, and be sure you’re on track for a long, happy, healthy retirement.

Need help with taking charge of your finances? Let’s schedule a time to sit down and explore where you are today and how to plan for tomorrow. As always, I’m here to help.

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When all feels lost, it’s time to find your A-team

There’s no doubt about it: women live longer than men. While every one of us wants to live a long, rewarding life, the fact that we live longer also means that, sooner or later, most women are likely to become widows. It’s not something anyone wants to think about, but when it does happen, it’s vital to know what, when, and how to take care of your finances to be sure you protect your assets and get on to solid footing moving forward.

How do you even begin to go about such an overwhelming task when your life has just changed completely? As a rule, we women are incredibly strong and able to rise to the tasks ahead—no matter what they may be—but one key to success is not going it alone. Now is the time to put together your A-team.

Liz, in her mid-70s, took a fall and was in a short-term rehab facility when her husband died unexpectedly. She suddenly had to manage everything from funeral arrangements to estate planning issues—all while being stuck in a hospital bed herself. Luckily for Liz, she had a lot of help from her daughter, Emily. Not only was Emily there to help do the legwork Liz couldn’t manage herself—everything from grabbing documents from her husband’s safe deposit box to meeting with the funeral director—but Emily also advised her to get immediate help to tackle the legal and financial aspects of dealing with her husband’s death. As a longtime client of mine, Emily recommended she call me first. When Liz and I talked that day, the first thing we did was put together her A-team—a group of seven individuals who each play a critical role helping her begin her life without her husband.

Widowed or not, if you don’t already have an A-team in place, here are the seven players I recommend every woman find and recruit right away:

  1. Your person. The TV show Grey’s Anatomy coined the phrase, “You’re my person.” It stuck, and for good reason. Everyone needs that one person they can count on, no matter what. For Liz, her “person” was Emily. For you, it may be an adult child, colleague, neighbor, family member, or best friend. Your “person” is the one you can trust to be there when you need help and who makes you feel safe.
  2. Your executor, successor, or co-trustee. An executor or trustee is responsible for making sure all assets of the deceased are accounted for and transferred to the right party, and to ensure that all debts and taxes are paid. An executor is legally obligated to meet your husband’s wishes as indicated in the will or Trust, and to act in the best interest of all beneficiaries. In most cases, this will be you—the new widow. Acknowledge that you need help with this big job.
  3. Your attorney. I’ve had multiple clients ask, “Do I really need to pay for an attorney?” The answer: YES. While it may seem attractive to “save” legal fees by dealing with probate, estate, and trust issues yourself or by getting help from a friend, you need a professional who understands every aspect of what must be done. Ask people you trust for recommendations, and then choose the professional who feels right for you. Getting appropriate legal help will save you headaches—and money—later on.
  4. Your accountant. Tax strategies can play a significant role in preserving your assets following the death of your spouse. I can’t underestimate the value of a good CPA to help you protect your estate. If you don’t already have a trusted accountant, again, get recommendations from others—preferably women who have been through your situation themselves.
  5. Your banker. In the immediate future, you’ll need cash to maintain your lifestyle—especially if any of your assets are tied up in probate. Your banker can help you identify all available funds, give you access to available cash (note that some funds may not be accessible for some time), and help you take over your husband’s banking responsibilities.
  6. Your insurance agent. At the top of your to-do list will be contacting the companies with which your husband holds life insurance policies. A good insurance agent will help with much more than that. As a widow, your needs have changed. Your agent can help identify appropriate life and health insurance to be sure you—and those who depend on you—are protected.
  7. Your financial advisor. Just last month a new widow was referred to me by her estate planning attorney. Her first question to me: “If I have a CPA and an attorney, why do I need you?” I explained that the role of a financial advisor (myself or another) was to invest her assets appropriately, help her work through her financial to-do lists, and create an individual plan for her financial future. As a fiduciary, I would also quarterback the actions of everyone on her team on her behalf, making sure everyone is working together toward her success.Four weeks later, we’ve assessed her financial big picture, adjusted her personal portfolio (her husband’s assets have not yet been turned over to her), worked with an insurance agent to get her proper coverage now that her husband is gone, and continued working closely with her estate planning attorney. We still have a lot to do, but I know our work has already helped her gain a new level of financial confidence.

When you are a new widow, you are swirling in emotion. Yet there are so many things you must manage immediately. From obtaining death certificates to poring through legal documents, paying bills, and more, you have too much on your plate. The good news you’ve been waiting for is this: with your A-team in place, you’ll have all the help you need to increase your sense of independence and gain control over your life.

Need assistance putting your own A-team in place? Whether you’re widowed or simply want to gain better control of your entire estate, I’m happy to help you build the right team for you.  

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All written content on this site is for information purposes only. Opinions expressed herein are solely those of Lauren S. Klein, President, Klein Financial Advisors, Inc. Material presented is believed to be from reliable sources and we make no representations as to its accuracy or completeness. Read More >