I’ve often thought it odd that people seem to be more reluctant to talk about their income than their sex lives-but that may be changing. The NY Times reported yesterday that young people are more likely to share information about salary information (see Not-So-Personal Finance). This trend is good news for women; the more women know about what others are making, the more likely they are to ask for what they are worth.
As you may know, the gender gap in pay affects not only older women but younger women as well. For example, starting salaries of men with MBAs are 7.6% higher than those for women. Only 7% of women, but 57% of men asked for more money; those who negotiated increased starting salaries by 7.4%.
One of the things that makes the difference for women is good information. So, keep up the sharing!
TAGS: differences between women and men, Fairness at work, financial planning, gaining confidence, negotiating pay, negotiation skills, Pay Disparity, Women at Work, women's equality
The Simple Dollar had a nice post about taking the training wheels off money management. Basically, after creating a plan to recover from a financial meltdown and after obsessively tracking every penny for awhile, the blogger realized he’d been spending less and less time managing his money–and that this was a good thing:
In short, I began to trust myself. I had seen the results time and time again of my good financial behaviors - my account balances went up and my debts went down. Eventually, I began to trust these principles, and that trust led directly to a reduced need to keep running the numbers and micromanaging everything.
That’s the groove we want to be in when it comes to money–neither obsessive nor unconscious. If we’ve been unconscious and let things get into a mess, then a little obsession may be in order until we’re back on track. Once we’re on track, though, a good system should keep us there without excessive monitoring or worry.
TAGS: budgeting, financial planning, personal finance, simplifying
Earlier this week I had a conversation with a woman who asked me to review her resume. I made the assumption she was looking to get an in-house job and gave her suggestions for how to make the resume appealing to employers. She had a strong background as a writer and editor and I could see her working in the communications department of a large company or advertising firm. About mid-way through the conversation she stopped me and said, “What I really want to do is be a screenwriter.” I should have known — half the people in the Los Angeles want to be screenwriters. But I took a risk and said, “As best I can figure from your resume you’re around 45 years old. Unless you’re telling me you have several hundred thousand dollars in the bank for retirement you need a job.” As it turns out, she was living on the edge financially — and she’s not unlike so many other women.
Listen up, girlfriends (and I don’t care if you’re 25 or 65) — if you’re lucky, you’re going to live be an old lady. If you don’t want to be living on the financial edge for the rest of your life you need to be thinking about how you’re going to get rich. It’s not a four-letter word, you know. In my book Nice Girls Don’t Get Rich I define rich as having all the money you need to live your life the way you want free from concerns about money. Doing well and doing good are not mutually exclusive. No one is ever going to take as good care of you as you are going to take care of yourself. I can tell you horror stories about women who thought they would be married to the same man for the rest of their lives only to find themselves divorced and with no or few financial resources of their own. So here are some tips:
- Have a financial goal. There’s not a woman on the face of the earth who doesn’t know what she wants to scale to read when she steps on it. But ask a woman how much money she needs to be rich or what she needs for retirement and she’s like a deer in the headlights. A financial goal helps you prioritize your spending — and saving.
- Pay yourself first. When you get your paycheck and you’ve paid your rent or mortgage, utilities, car payment, etc. you’re not finished. One other “must pay” is your retirement account. It’s not optional. It’s required just like all of your other bills. Then, after you’ve paid yourself, what’s left over you can spend on “nice to have” items.
- Stay involved in your finances. If you’re married or partnered, don’t turn the finances over to your mate to worry about or handle. Be involved with where that money is going. If something were to happen to your partner (either through death, divorce, or incapacitation) you need to know where the money is and how to handle it. If you doubt me, read Barbara Stanny’s book, Prince Charming Isn’t Coming.
- Learn about finance and investing. Our own Liz Weston (www.asklizweston.com) and our friend Barbara Stanny (www.barbarastanny.com) have websites with plenty of tips to help you become more financially savvy.
- Buy a home. I know, the market right now is in a slump, but this is the perfect time to get into your first home. Real estate has traditionally been a great way to create equity over time and I have no reason to think that will change for the long-haul. Just beware of shady financing deals. If it seems too good to be true, it probably is. Too many women wait to get married to get into their first home — don’t be one of them. Your first home doesn’t have to be your last.
TAGS: financial planning, Investing, retirement planning
Watching our portfolios slide in value is never fun, and this time around we have the double whammy of knowing our home prices are down as well. I’ve offered some suggestions on my Web site about how to keep from panicking, including turning off the doom-and-gloom commentary and tucking away a bit more cash as a safety net.
Most of the surveys I’ve seen on the topic suggest that women, when they invest, are better investors than men because we trade less often, are less likely to be “overconfident” and more likely to learn from our mistakes. But too many women shun the risk of the stock market because of times like these and deprive themselves of the superior long-term returns only stocks can give.
We shouldn’t let the day-to-day noise of the markets scare us out. If you have an investing plan, stick to it; if you don’t, get one. FinancialEngines.com can help do-it-yourselfers create a retirement portfolio, or you can hire a fee-only planner from NAPFA.org or GarrettPlanningNetwork.com.
TAGS: financial planning, investments, market turmoil, stocks, women and investing
