Book Review & Notes: Women With Money by Jean Chatzky
“Women are very clear about what we want from our money. We want to satisfy our needs for safety and security. We want to increase the time and freedom we have to pursue the things we want to do and offload those we don’t. We want choices in career, education, community. We want control. We want to pay it forward. And, yes, we want nice stuff - there is absolutely nothing wrong with nice stuff.”
Women are very clear about what we want from our money. We want to satisfy our needs for safety and security.
This month’s book is Women with Money: The Judgement Free Guide to Creating the Joyful, Less Stressed, Purposeful (and Yes, Rich) Life You Deserve by Jean Chatzky. I had seen this book circulating around social media so when I saw it at the library, I picked it up. I, honestly, had never heard of Jean Chatzky before until very recently. I think a part of it is because I don’t have cable or watch a lot of mainstream tv, but she often appears on NBC as their finance editor and various other programs. She is also the author of several other books relating to finance.
I was of course was intrigued by the title. As I’ve read a lot of personal finance books, most by men and most by men giving women advice, I always find it refreshing to find a book written by a women for women.
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Chapter Breakdown
Here’s the list of chapters from the book. As always, I pulled a few chapters to break down.
Part 1: You and Money: An Explanation
Chapter 1: What Do You Want from Your Money?
Chapter 2: Your Money Story (and How It Affects You to This Day)
Chapter 3: Why is Money so Maddeningly Emotional?
Chapter 4: Your Money and Your Relationships
Part 2: You in Control of Money: Making the Most of the Resources You have
Chapter 5: Getting Paid What You’re Worth…Plus Tax
Chapter 6: Yes, You Are an Investor
Chapter 7: Investing in Your Own Thing
Chapter 8: Buying Real Estate You Live In…and Real Estate You Don’t
Chapter 9: The Joy of Spending
Part 3: You Using Money: To Create the Life You Want
Chapter 10: Raising Kids Who Launch and Flourish
Chapter 11: Caring for Your Older Parents
Leaving a Legacy
Chapter 6: Yes, You Are An Investor
I loved this chapter because she highlights a big gap in how women define themselves when it comes to money. At the start, she asks the questions:
Do you have money in a retirement plan like a 401(K) or a 403(B) or an IRA?
Do you own stock in the company you work for?
Are you putting money into a 529 college savings account?
Do you have an account with a brokerage firm or robo-advisor?
Do you have an app on your phone that saves up your spare change and invests it?
I asked these same questions to a few people on Instagram and even though many could say “yes” to the above questions, many women still would not consider themselves as investors. Jean states “You are an investor. You just don't feel like one.” She iterates in this chapter that investing is a slow and boring process. Because it is more for the long-term, investing is passive and shouldn’t entail a lot of crazy work. She goes on to provide the 3 things that determine how successful most investors are: 1) amount saved 2) asset allocation and 3) security selection. There’s really no magic formula and if women are already doing this, then we are all investors.
In this chapter, the author covers a few options on how to invest which may encourage other women to get started as it doesn’t seem to daunting. Take a look at the many options for investing so that you can find one that works for you. Also, remember that as women, we need to make our money grow. We are already underpaid and we need to take advantage of owning appreciating assets to survive well into our old age.
Chapter 8: Buying Real Estate You Live in and Real Estate You Don't
I like this chapter because my husband and I have been having many, many conversations about our next big financial move. I think we’ve concluded that it will be a investment property of some sort, but I don’t personally know too much about real estate investing so I am more risk averse than him on this topic so have been very reluctant to make any moves. I think many other women are on the same boat as me when it comes to real-estate investing so this chapter provided lots of good insight into why to look into real-estate investing.
When we bought our condo, the condo that we live in right now, I wanted something smaller that was easier to manage and didn’t require a lot of heavy maintenance. My husband grew up in a city (Istanbul) and we had to be honest that he wasn’t going to enjoy doing yard work in his free time. It’s not something he is used to and I certainly wasn’t a fan of it so a house with a yard was out of the picture for us. We had also thought about buying a larger place to host and entertain overseas guests, but the more we thought about it, we don’t necessarily have guests that often to warrant paying an extra few thousand dollars a year in mortgage for empty rooms. In the end, we netted out on a one-bedroom condo that we can easily rent out. Once our family grows, then I am all up for moving on to a larger space.
“You're not just doing it for an investment, you're doing it for enjoyment. So, realize that for what it is. If you are going to buy a bigger house because you love to entertain, realize all your other expenses will increase as well. Your whole footprint gets bigger. And then it's hard to pull back if you haven't saved enough for retirement.”
In this chapter, Jean asks an all important question:
How many paid-off houses do you need to generate passive income you need to live the life you want?
This is an important question because sometimes people automatically think having a mortgage is good because it will lead to a tax deduction, but at the current tax plan, it’s not the most advantageous. Given the current tax deductions, a mortgage still requires interest to be paid which means you still owe money so it’s crucial to really sit down and think about why and how a second or third property will be beneficial to you.
Rules of Rental Properties
Decide what you are looking for
Get an education. Learn the real-estate lingo so it’s not so daunting.
Start with property within an hour of where you live
Aim to follow the 1 percent rule (aim to rent your property for 1 percent (per month) of whatever you pay for it)
You are not living there so 1 to 2 bedroom may be fine. Think about potential tenants and what they can afford and would want.
Plow the profits back into your properties and continue the cycle
Create a timeline in sync with your goal
Find some good mentors
“You’re not just doing it for an investment, you’re doing it for enjoyment. So, realize that for what it is. If you are going to buy a bigger house because you love to entertain, realize all your other expenses will increase as well. Your whole footprint gets bigger. And then it’s hard to pull back if you haven’t saved enough for retirement.”
Chapter 9: The Joy of Spending
Many personal finance books will tell you to curb spending and while I also believe it’s one of the core tenets of growing wealth, we need to stop feeling ashamed about spending money, but figure out how to spend in a way to brings us more joy and happiness. I’ve often written that girls and women alike have been taught to spend at a very young age making spending the default for all of our woes. Spending has it’s place, but it is not the cure all. After all, money should be there to help us achieve our goals and allow us all to live a richer life. This chapter is a strong reminder that spending is OK, but we have to spend strategically. We have to remember that spending as a form of therapy to accumulate stuff we never use and want is a waste of our energy and resources. Remember, all of that stuff around us was once money. So instead consider the following 3 ways to enjoy spending:
Spend on Experiences, not Things
Spend on Others
Use Money to Buy Time
Chapter 10: Raising Kids Who Launch and Flourish
I have also just finished reading the book Fed Up: Emotional Labor, Women and the Way Forward and have been privy to all of the ways women take on all kinds of labor. Along with all of the housework, perhaps a full-time or part-time job, and all of the other invisible tasks that women have to do, women are also expected to raise healthy, thriving children who can flourish in this world. With that is the responsibility of teaching children about money so I was glad to see this section in the book. She offers some advice on how to ensure both girls and boys equally learn the value of money throughout their childhood. An allowance is a great teaching tool, but parameters must be set so they know what you are willing to buy them vs. what they have to save up for using their allowance. Equally important too that kids learn from observing you, not from your words, so if you don't do it, they won't learn it too.
Teach them the difference between wants and needs
Teach them to choose
Teach them to tell themselves not
Teach them to work toward a goal
Teach them how to wait
Team them it's not the end of the world if they fail
Chapter 11: Caring for Your Older Parents
I’m going to be a part of the sandwich generation soon. This is the generation that must care for both aging parents and young children at home. It’s weird to think of your parents aging, but last year, I saw first hand what this meant. My parents officially retired, sold our childhood home and have decided to spend time both in the U.S. and in the Philippines. I talk about their journey here on how they are using geo-arbitrage to reduce retirement living costs as well as some tips we went through to get themselves ready for retirement.
The hardest of course was to start the conversation. Perhaps, I just didn’t think I was ready to have it, but I realized early on when my mom got sick that this conversation was much needed. I also had the opportunity to live with my parents for over a year in my 30s and saw first hard how they were handling their fances and this encouraged conversation about their retirement plans. This is a terrific chapter to give you the tools needed to start that conversation with your older parents.
What’s Missing from the Book?
With the title being Women With Money, I do wish the author covered a bit more on the balance of being a working mother. One of the things I wish a mentor or someone who has gone through figuring out how to balance a career and a children was to provide the advice that the money you make as a young woman in your early 20s can significantly help you in the future. Namely that money can truly buy you time in the future. In the case for me, I want to be there when my children are young so this will most likely mean not going to work full-time. Knowing this is a plan in the back of my mind, I wish the book went on to provide a few more tips on how to make staying at home less financially painful. For example, specifically in my situation, I already have over 15 years of work experience (I’ve worked since high school) and accumulated savings behind me so what else can I do to ensure the money I have saved and invested to date continues to grow while I am out of the workforce caring for my family. Conversely, if I was still in my 20s, how can I save and invest strategically in a way that will allow me to take that time off to raise children without impacting my future financial goals. As they say, the earlier we start, the better off we will be.
I do think the book provides lots of perspective on what women need to be thinking about moving forward when it comes to finances, but do think this book is geared towards more established women since it is about women WITH money. For those just starting out, I would recommend Broke Millennial or The Financial Diet.
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Book Review & Notes: Women With Money by Jean Chatzky
