Guest Post: Women Breadwinners Can Level the Financial Playing Field

Women as Breadwinners | CorporetteWomen breadwinners is a topic we’ve touched on before: we answered a reader question about dating a guy who makes significantly less money, and a few breadwinning readers had some interesting comments on our recent Tales from the Wallet about managing your money after you get married. I was curious (and excited) to hear about an entire new book examining how relationship dynamics change when the woman is the breadwinner, and reached out to the author.  Please welcome Farnoosh Torabi, sharing an adapted excerpt from her book When She Makes More: 10 Rules for Breadwinning Women.  Kat

Evidently, if you make more than your man, you’re more likely to be the one in control of the money. My nationwide survey co-conducted with clinical psychologist Brad Klontz revealed that women who bring home the bigger paycheck are significantly more likely to be the primary decision makers on money matters and take charge of things like paying bills, budgeting, saving, and planning for retirement.

But while such an arrangement has its advantages, it could also be asking for trouble. It calls for a new rule.

A sense of equity between two committed people is important, even if there’s an income disparity. But to keep a man’s dignity and sense of engagement, he needs to feel like he plays an important role in the relationship and that he’s not completely isolated from the financial decisions. And for a woman to keep her sanity and sex drive alive, she shouldn’t have to do the equivalent of a CFO’s job after she’s gotten home from her 9 to 5 (or 7 to 11).

Consider this scenario: When Kyle lost his job in IT, his social worker wife Lynne suddenly became the breadwinner for their family of six. The Houston couple’s income shrank by 50 percent, but their bills continued to pour in. The stress was mounting, so Lynne took it upon herself to manage all of the family’s finances (i.e., paying bills, balancing the checkbook, managing the savings account), while Kyle buried himself in his job search. It felt like she was helping out — why saddle Kyle with more work when he could be polishing his resume and practicing his interview skills? But in taking over the finances, Lynne cut Kyle out of the decision-making process. Yes, she took care of the bills, bought the groceries, but she also did not appreciate when her husband used their discretionary money to buy, say, a new pair of golf shoes. And thus a vicious cycle was born: Kyle, grasping for some sense of autonomy and dignity, started making (and hiding) personal purchases outside of the budget. Lynne then clamped down tighter. Both started to lose respect for the other.

The challenge: How can men and women help each other not just feel, but be accountable for their finances when she makes more? From a practical standpoint, who pays for the mortgage, vacations, and everyday living expenses? From an emotional standpoint, how do you make him feel like a player and that his contributions — financial or otherwise — matter? What steps can a couple take to reach financial fairness? Although he may not make as much, how can he feel as involved with and connected to their shared financial life as she is? The answer lies in the following When She Makes More rule: Level the Financial Playing Field. In every relationship the solutions are different and no one way is necessarily right or wrong, as long as both of you are on the same page and agree to these simple protocols:

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Tales from the Wallet: Should You Get an MBA?

should you get an MBAShould you get an MBA? If you’ve ever pondered getting your MBA but wondered if it was worth the investment of time and money, today’s guest post is for you. We’ve talked about how to prepare your finances for grad school, as well as the pros and cons of changing careers, but we truly haven’t talked about this — so I’m thrilled to welcome the personal finance blogger behind Well Heeled Blog, a young woman who just finished her MBA. Welcome to Corporette! – Kat.  (Pictured: Ted Baker London ‘Neon’ Leather Card Wallet, $55 at Nordstrom.)

I recently graduated from a 2-year, full-time MBA program at one of the “15 schools that make up the Top 10 MBA.” I once heard a dean use that phrase and think it’s a humorously apt way to describe the way schools jockey for that much-vaunted “top 10.” designation.

Once you include the money I spent out of pocket and the opportunity cost of two years of foregone earnings and benefits (minus the living expenses I would have had to spend, MBA or not), this degree cost me at least $250,000. That’s enough for a house in many parts of the country, and a hefty down payment in even the priciest areas such as San Francisco or New York City.

Was my MBA worth it? I’m a long-time Corporette reader and occasional commenter, and I’ve seen several questions on MBAs and finances. The decision to pursue an MBA isn’t solely about the ROI in dollars and cents–there are plenty of non-financial benefits such as a grounding in business education, a wider and deeper network, and the opportunity to devote two years to furthering your professional and personal growth. Still, the fact remains that an MBA is an expensive proposition for most people, and this proposition can expand your career horizon while at the same time limiting your future financial choices. Here are my thoughts about the financial implications of an MBA now that I have completed my degree–what I would (and have) told friends who are thinking about pursuing an MBA, especially through a full-time program:

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Tales from the Wallet: Different Money Management Methods for Marriage and Partnerships

Managing Money after Marriage or Partnership | CorporetteWe’ve talked about how to keep track of many accounts — but I don’t think we’ve ever talked about which money management method Corporette readers prefer, once married or partnered.  There are a number of different methods that I’ve heard about through the years, and I’m curious to hear from you guys (particularly those of you who are the breadwinners):  what is your family’s method for sharing money?  (Pictured: Cole Haan Parker Exotic Tech Snap Wallet, on sale at 6pm for $59 (was $128).)  There was a great series in Slate a few years ago (now available as a Kindle book) that defined these main types:

  • Common Potters – people who combine all of their money
  • Sometime Sharers – people who have both separate and joint accounts (usually with an automatic percentage going into the joint account)
  • Independent Operators – people who have completely separate accounts

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Tales from the Wallet: How to Invest $10K

How to Invest $10K | CorporetteHow should you invest $10K? Readers were talking about this on our money roadmap post, and I thought it might be helpful to talk about more. Maybe you’ve recently gotten a bonus or small inheritance… maybe you’ve just been saving for a while and are now saying, OK, let’s invest this sucker. So what are the options? (Pictured: I’m kind of obsessed with this metallic teal wallet from Marc by Marc Jacobs (there’s a phone wristlet too!) The wallet was $208 but is now marked to $104 at Nordstrom.) I’m not a personal finance expert, of course, but here’s what I’d do (assuming you already have a fully-funded emergency fund and no credit card debt.  If you still have student loan debt, you may want to look at your interest rates and pay off all or part of a loan that has a particularly high interest rate.) Beyond that, though: [Read more...]

Tales from the Wallet: A Money Roadmap

money roadmapWe’ve talked about a ton of different money issues here, but it occurred to me that it might be helpful to do a simple “roadmap” post — a listing of what to do, in what order, with links to the appropriate posts.  So here’s my list of what to do with your money — if I were advising a friend, this is what I’d say.  Readers, what would your roadmap look like? Would it be any different? (Pictured: Halogen Cassie Patent Leather Phone Wallet, originally $48 but currently $32.16.)

1. Figure out what your money situation is.  Do you know how much you have in each account, where it is, and how much interest it’s earning?  Do you know what your debts are, and how much interest you’re paying?  I like Mint.com to keep track of multiple accounts (and I particularly like that it will email multiple email addresses with weekly updates — great if you’re married or otherwise in a joint banking relationship). [Read more...]

Tales from the Wallet: Emergency Funds – How Much & Where

Your Emergency Fund: How Much, and Where? | CorporetteHow much do you keep in your emergency fund?  WHERE do you keep it?  How often do you re-evaluate it? We haven’t talked about emergency funds in a few years, so I thought we should revisit. (Pictured: Tory Burch Priscilla Wallet, was $250, now $175 (also available in fuchsia, as well as in a zippered pouch on sale for $66).)

The basics remain the same:  the suggestion I always see is to keep three to nine months of living expenses (mortgage, rent, loans, food, basic living needs), easily accessible in case you’re laid off, fired, quit, or are otherwise unable to work — or if you have some other huge unexpected expense, like if your car breaks down or you get in an accident and have bills to pay.

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