Kimberly Palmer, author of “Smart Mom, Rich Mom: How to Build Wealth While Raising a Family” talks with Kim Parlee about strategies for moms that can help them spend and save smarter for their families.
Well, my next guest asks, why do men get magazines and books on investing and getting rich while women get lectured on pinching pennies at the grocery store and cutting back on our shoe collection?
So she decided it was high time that women and moms get some special attention and guidance when it comes to building wealth.
Kimberly Palmer is the author of Smart Mom, Rich Mom-- How to Build Wealth While Raising a Family.
And she's also senior money editor for US News and World Report.
She joins us from Washington, DC.
Kimberly, nice to see you.
Thank you for having me.
It is my pleasure.
OK, so let me-- I said it in the introduction here.
So the question is, why do men get magazines and books on investing while women get lectured on pinching pennies?
Why do you think that is?
I think when it comes to money, we still have a very retro attitude in terms of gender differences.
And you see it in magazines, you see it in advertising.
And the women that I interviewed for this book, they told me over and over again, they felt this disparity.
They felt like when they were being talked to about money, whether it was from the media they were reading or even professionals, they felt like they were almost being condescended to and were talked to about a very narrow area of subjects compared to men.
So I wanted to change that and really talk to these bigger issues that are so important to moms.
We make so many decisions when it comes to our family money.
What are some of the decisions you think that you talk about in your book that probably aren't talked about as much with women as they should be?
What are some of big ones we need to keep in mind?
The big, looming ones that came up over and over again are saving and investing for retirement and college.
So as moms, we're often so concerned about our kids' futures and making sure we're planning for that.
So so many parents really prioritize saving for college.
And then, of course, we can't forget about the other big long-term goal of retirement.
And sometimes those two things are hard to do together.
So a lot of these issues and questions that parents have revolve around prioritizing.
How do you manage these big household expenses that only go up when you have kids, along with these long-term goals of saving and investing?
So really, it comes down to those big, big issues of, how do you make everything work?
How do you work toward those long-term savings and investing goals while you're also dealing with the day-to-day of parenting?
So what are some of the pitfalls?
Because I get it-- I've got a young son.
I know what it's like to prioritize him over me.
A lot of times-- there's times when he'll have dinner, I'll make sure he'll eat, and I'll forget, I won't eat myself, which is a great, I think, metaphor for the investing side you're talking about.
But how do you not do that, then?
How do you structure it so that you do make sure you take care of your kids' education and plan for your retirement?
This is actually such a big problem for moms, because you're right, it's our intuition to put our kids first.
But it can be such a mistake to do that with money and really hurt us in the long run.
So basically, number one, the thing to know is that moms-- with women in general-- we are already facing big challenges with retirement, because we tend to take time out of the workforce, work at a lower rate of pay, work for fewer years, and that hurts our retirement savings.
And it's something we have to overcome.
So the number one thing is simply realizing that, acknowledging it, and setting up accounts.
So make sure you have a retirement account that you're putting money into automatically every month or every paycheck.
And that way, you'll be working towards those goals.
Of course it's great if we can also save for college, that other big goal, at the same time.
But for some families, there are lean periods where you have to prioritize and make difficult choices.
So definitely make sure you're putting yourself first and saving for retirement.
You also have some great tips within the book talking about not just the investing side-- but I'm glad you bring that up, because I think that's a big one for women that gets overlooked, and really more time needs to be spent there-- but also the spending.
And I love this, what you have with credit card rules-- credit cards are like high school boyfriends.
Some are reliable and supportive, but most are not worth your time.
It is a problem.
Credit card debt is a very big problem for a lot of families, and especially because we end up having emergency costs, and if we don't have an emergency fund to turn to cover those costs, then of course it goes on the credit card.
So if families have credit card debt, the top priority is often paying that off, figuring out a plan so you can cut back in some areas and put money towards paying down that debt, because you really don't want to be saddled with that.
It's so expensive going forward.
The other big thing I noticed a lot of moms overlook in terms of their regular spending and saving is workplace benefits.
So often through you or a partner, workplace benefits, you might be overlooking things and actually leaving a lot of money on the table.
The obvious one, of course, are retirement benefits.
But often increasingly nowadays companies are offering other kinds of benefits, like flex spending plans or wellness plans.
Wellness plans are really big now.
And they can offer money back.
So if you're signing up for things like-- even counseling, mental health counseling.
If you're going through a stressful time, there's resources often through workplaces.
So make sure you're not leaving money on the table by overlooking some of those benefits, too.
That's a really good point.
You say in the book as well-- and again, there's a lot of things, and I can't touch on everything-- but you say "think like a boss." What do you mean by that?
Yeah, so women often are in so many different kinds of situations, especially when they're going through those raising children years, which, as I know as well as you do, are so intense when you have young kids.
And so women often come up with all kinds of creative solutions-- launching their own businesses, taking on part-time freelance work, contract work-- so you're not stepping out entirely, but then when you are ready to go back to ramping up your income again, you're ready.
You have those networks in place.
So "be your own boss" really speaks to the mentality of taking control of your career, whatever stage you're at.
Even if you have really scaled back for caregiving needs at the moment, that might change down the road.
So making sure you're in a position where you can ramp that back up again when you're ready if your family needs to, because often, we have to protect our earnings so we can step in and increase our earning if we need to down the road.
All kinds of things can happen in life, as we can see.
So just being prepared for things like divorce, the fact that women tend to outlive men-- all of these factors really speak to the fact that we need to be prepared to earn money and manage money for our families.
Fantastic book, and a great conversation, Kimberly.
Thanks so much for joining us.
Thank you, Kim.
That is Kimberly Palmer.
She's the author of Smart Mom, Rich Mom-- How to Build Wealth While Raising a Family.
She's also the senior money editor for "US News." And there's a look of the book on the screen.