Before I started working on Smart Mom, Rich Mom, I made many of the classic money mistakes that other moms make. The biggest one was that I let my husband manage all of our savings and investment accounts – I didn’t even have the password to half of them. I’m not alone – a recent T. Rowe Price survey found that in most households (54 percent), men say they are the only ones managing the money.
Given the startling statistic from Fidelity that 90 percent of women will have to manage our finances solo at some point in our lives, due to life circumstances such as widowhood or divorce, it’s time for us to do something about this imbalance. We can embrace our role as our family’s chief financial officers – and we should, because our kids’ financial futures depend on it. Here are three easy ways to get started:
- Make sure you have easy access to all your accounts.
It sounds obvious, but so many of us couldn’t even quickly log into our retirement accounts or household savings accounts if we needed to. Whether you keep your accounts organized in a three-ring binder (my preferred method) or in an Excel document, you need a system for tracking your money. That way, you can easily make changes or transfer cash when you need it.
- Set up automated savings for your biggest long-term goals.
For many of us, saving for college and saving for retirement are two of our biggest long-term financial goals. Given how busy we are, one of the easiest ways to make sure we’re making steady progress toward saving for those goals is to set up automatic transfers to deduct our savings amount from our primary account each month into tax-advantaged accounts, such as a 401(k) for retirement and 529 college savings account. That way, you’re still saving, even if you’re not thinking about it.
- Invest your time in the right financial activities.
While there’s nothing wrong with couponing, it’s not the activity that offers the biggest bang for our time investment. Instead, spend an hour on the weekend reviewing and rebalancing your retirement savings accounts or signing up for flex-spending benefits for child care or health care costs if they’re offered through your work. Signing up for the right workplace benefits and investing your money well could end up generating hundreds or even thousands of dollars a year for your family.
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