Jacki Liautaud

In this article, we look at a potentially costly mistake women make with money.

Women budget, men invest – but it doesn’t have to be that way.

I had a conversation the other day with another woman advisor, where we agreed that we as a society need to do a better job educating women about investing and finances. She said, “Women budget, men invest.” As a woman advisor, I talk to women all the time about what they are doing with their money, and what they could be doing with their money – or rather, what their money could be doing for them!

A recent article in Investment News highlights this discrepancy between men and women. The article says, “falling short in the amount or percentage of income they invest could cost some women more in the long run than the gender pay gap”, according to Sallie Krawcheck, CEO and co-founder of Ellevest robo advisor.

She also says, “…women today invest less than men do…This gender investing gap costs women hundreds of thousands…over the course of their lifetimes – for some women more than the gender pay gap does.”

59% of women ages 20-34 defer investing and financial planning to spouses.

Also from the article: “According to a survey by UBS Group released earlier this year, 59% of women age 20 to 34 defer investing and financial planning to spouses.” While it’s perfectly logical, and frankly necessary, to divide up the myriad household responsibilities, at some point this can be a problem. Women typically live longer than men, so even women who remain married may become widowed and need to know more about their finances than they ever did before. Why not start learning about investing and financial planning now?

Read the full article here (link opens in new tab). And talk to your financial advisor about your specific situation.

In this article, we will discuss how to make contributing to a child’s education savings account an enjoyable gift.

What’s not to love about giving the gift of education?

For that special child in your life, consider giving the gift of education this holiday season – or during any gift-giving moment like birthdays. How about making a contribution to an Education Savings Account for that important child in your life?

An Education Savings Account is a type of account that is typically funded with after tax contributions, and if used for qualified education related withdrawals, can be withdrawn without any taxes owed on the withdrawal, meaning, tax free growth. There are different types of accounts like a Coverdell Education Savings Account and a 529 Account, and not all accounts work for every situation. Consult a financial professional before opening an account. Read more about the details here (link opens in new tab) and here (link opens in new tab).

The kid won’t like this gift, and besides I want something they can open and play with!

I came across this blog article with some really creative ways to make a contribution to an education savings account more fun to give as a gift. Pairing one of these ideas with the gift of education seems like the best of both worlds.

Read the ideas here (link opens in new tab).

In this article, we examine a recent survey on retirement savings and consider ways to re-allocate money for savings, using a budget.

45.5% of adults may have nothing saved for retirement.

According to a survey published in October, 45.5% of over 2,000 adults of all ages polled had nothing saved for retirement.  GoBankingRates.com is an educational and financial information resource for consumers and published the survey.

Another 18.8% of respondents have less than $10,000 saved for retirement.  And 12.3% have between $10,000-49,000 saved. Keep in mind, retirement can be 30 years long, depending on when you retire and how long you live.

Won’t social security will help people in retirement? 

According to a report published in US News and World Report, the average monthly social security payment as of January 2019 was $1,419.  Social security likely won’t be sufficient as the sole income source in retirement.

According to the same GoBankingRates.com survey, 45% of respondents said they don’t make enough money to save.  This was the number one reason respondents said they couldn’t save.

So how can you “find” money to start saving? 

That could start with looking at the amount of money your household earns in income, compared to the amount of money your household spends.  In other words, create a budget.

Here’s an article I wrote on some tips for creating a family budget.  Ultimately, once you find out where you money is going, you can figure out where there is opportunity for saving.  Maybe there is an old subscription service or gym membership billed monthly on your credit card that you no longer use. Many people find they can set up a monthly transfer of funds from a checking to a savings account, creating an automatic savings tool monthly.  Maybe eliminating one meal out per week is reasonable with a little more advance meal planning. Whether it’s $10 or $100 per month that you can save, automating the savings can result in less decisions you need to make each month.

Note that you should consult with your financial professional on what is best suited to your personal situation, as information included here is not intended as personal advice.

In this article, we will discuss some common reasons why individuals choose to use budgets, and a simple how-to if you’re ready to start.

Umm, I have no idea how much I’m spending each month.

Regularly when I meet with clients, I ask them questions about their income and spending. Income is usually relatively simple to get a firm number, but the questions of how much are your monthly living expenses? or how much do you spend per month? are often met with, “Ummm, I have no idea”.

I don’t like budgets. Here’s why.

Obviously, if a person has a budget, they should know exactly how much they are spending and in what categories. But the problem is, who likes keeping a budget? Keeping a monthly budget requires substantial time to set up the initial budget, and especially to track actual expenses against what was budgeted, identifying any discrepancies. And who has time for that in their daily lives?

But the basic problem remains: to develop a good financial plan, you typically need to know where your income is being spent right now. And frankly, there are other reasons to have a budget as well – like figuring out if any expenses can be cut or redistributed so that your money better aligns with what’s important to you in your life.

So I have developed a few simple ways to budget, which I actually use with my clients. Some of my clients prefer an online tool that can import data from their bank accounts and credit cards, like ynab.com. Other clients prefer an actual spreadsheet that they manage in Google Sheets or Excel. And in some cases, clients prefer to use an old-school envelope system, where the monthly cash gets put into envelopes for each of the expenses. When the money is gone from that envelope, no more spending in that category is allowed until next month.

Ready to start your own budget? Here are a few simple tips.

Here’s one way to get started which can work for some individuals.

First, make three sections on a piece of paper (or in your spreadsheet): Yesterday; Today; and Tomorrow. (I based these categories on an episode of Hilary Hendershott’s Profit Boss Radio podcast.) This assumes you already have some emergency fund stashed away.

Yesterday: In the “Yesterday” section, include any spend that you have already committed to. This will include rent/mortgage/real estate taxes, utilities/cell phone/cable, debt repayment like student loans or credit card, streaming services or gym memberships, car loan or lease payment, private school tuition.

Tomorrow: In the “Tomorrow” section, list out anything you are saving money for. This could include a vacation you plan for next summer, the purchase of a new car or home, college for your kids (or you), home repairs, or a wedding.

Today: In the “Today” section, you’ll include all the day to day things you spend money on, like groceries and restaurants, gas, clothing, and anything else you typically spend money on regularly. Typically, this is the section which is most difficult to complete because it varies so much from month to month and many items are discretionary.

To get a big picture view of your budget, complete the Yesterday and Tomorrow sections first. Compare that to the amount of take-home pay that goes into your bank accounts each month. The difference is your Today spend. Simple, right?

Now, it’s time to fine-tune.

Are you pleased with what you found from this exercise? In other words, is your spending aligned with your life priorities? If not, it’s time to fine-tune.

Carefully examine your last three months of credit card and bank statements. Make sure the expenses are included accurately in your budget. Highlight any expenses that are discretionary, meaning, you can modify them if you like. Can you eliminate some of your monthly subscriptions for a streaming service you no longer use or a gym membership you no longer attend? Can you scale back your eating out by making a weekly grocery run and spending some time meal-prepping to avoid all the casual food purchases? Can you eliminate the impulse walk through the accessories section at Target on your way to buy toilet paper?

I believe knowledge is power. If you have the information, you’re on your way to making informed decisions. A budget can be a step along the way.

If you’d like a copy of the budget spreadsheet I sometimes use with my clients, request one using this form: https://treefortfinancial.com/contact-us/

In this article, we will discuss some common reasons why having a financial advisor might be helpful.

Financial advisors can help organize your financial life.

Financial advisors can help you get your financial life in order. For example, a person may have worked multiple jobs over the years, accumulating 401k/403b assets along the way. A financial advisor can help you get a handle on how much you have and where it’s all located. As part of a data collection meeting, a financial advisor usually asks you to provide details on your personal assets and liabilities, so this is a good time to pull out all those old statements!

Financial advisors can also work with other professionals in your life, such as accountants or CPAs, estate planning or family attorneys, and other professionals to help identify opportunities for saving money, tax efficiencies, or estate planning.

Financial advisors can help identify specific things you can do to get your financial life in order.

One of the best aspects of a financial plan, in my opinion, is that it can act as a roadmap for what you need to do to stay on track financially. A financial plan can provide very specific and practical details like, “save this amount from each paycheck in your retirement account”, or “refinance your mortgage to take advantage of low interest rates”, or “pay down this credit card first by paying this amount per month”, or “yes, you have enough saved to start your kitchen upgrade but spend no more than this amount”. These are just examples and not intended to be specific recommendations to the reader, but you get the idea. A financial plan can provide very specific information about what you need to do to get on track, and stay on track, towards your specific financial goals.