Money Musings 💠You can’t take the human out of money
Money mindset is how one interacts and relates to money.
Our families, cultures, how we were raised, the influential people in our lives and impactful experiences all come together to create our money mindset.
For example, I’m an elder-millennial who started my career during the Great Recession. That definitely impacted how I view and interact with my money.
The cool thing is that in a lot of ways our money mindsets are there to protect us. Because we saw and experienced the market crash in 2007, we make sure that we’re investing for the long-term and that we have enough cash for the short-term.
Because we experienced the feast and famine nature of our parents spending in childhood, we course correct and make sure we have robust savings.
These are strengths. đź’Ş
But when we take these course corrections to an extreme or when they are in opposition to our goals, our money mindset can inhibit our happiness and prevent us from getting what we want.
Here's an example.
If you were ever told "no" as a child (all of us!), it probably sucked. And if it was made clear that this "no" was because of money, you might have made the decision that you weren’t going to tell yourself "no" as an adult.
Maybe you weren’t allowed to add the cheese to your cheeseburger or weren’t allowed to add on the soft drink when you got take out.
You might decide - "When I become a grown up, I’ll ALWAYS add the cheese or I'll ALWAYS add the drink to my meal."
This was a decision made from a place of love but as an adult this same person might notice that they overspend, buy on impulse, and can never seem to stay on budget.
These "aha" moments are when we realize that there’s no way to separate the human (aka us) from our money. If you are ever struggling to change a money habit or can’t seem to edit your behavior, go right to your money mindset.
How might your life experience be enabling the behavior or habits you are wanting to change?
MONEY MOVE OF THE WEEK
GROW YOUR MONEY.
When we don’t invest we miss out on tens of thousands, if not millions of dollars over the course of our lifetimes. Why?
Compound interest is critical to building wealth. It’s a beautiful thing! Our interest earns interest and the results are exponential. Yes, please. 🙏🙏
Our retirement accounts are a great place to start investing. This might be through a company 401(k) or an IRA (Individual Retirement Account). It’s a way to get comfortable researching funds and to experience what it’s like to live through the market movements.
Before we start investing a large part of our savings outside of our retirement accounts, we want to have some important boxes checked:
âś… Have a minimum rainy-day fund
âś… Be maxing out our 401(k) matching
âś… Have paid off high interest credit card debt
âś… Be investing for retirement
We want to invest money we won’t need in the short-term. Now, if you don’t have these boxes checked, that’s okay. You can set aside a certain amount of money to learn to invest.
We learn by doing. This can be a really fun way to practice and get educated so that when you do have those boxes checked ✔️, you can hit the ground running.
P.S. Read chapters 7 and 8 of Financial Adulting for everything you need to know to start investing confidently and consciously!
YOU GOTTA SEE THIS
THE PINK TAX - WHAT IT IS AND HOW TO AVOID IT.
If you’re a woman, you pay a pink tax. I spoke with Liz Grauerholz, a sociology professor who studies social inequalities (including the pink tax!) in an interview for Financial Adulting.
She describes the pink tax as "the practice of charging women more than men for identical services and products." This discrepancy applies to clothes, toys, and healthcare products, among many other things. 💸💸
The pink tax cost the average woman $2,294 in 2021. If we invested that amount annually in the market, that would be over $100,000 in 20 years.
I’m enraged. Are you?
Liz shares some things we can do but stresses that "the burden shouldn’t rest on the individual consumer to force change. It’s important for communities and states to enact policies dictating fair pricing."
Support companies with gender neutral pricing (they exist!)
Buy more gender neutral products
Avoid the dry cleaner’s as much as possible
Compare prices when shopping (this goes for razors and shampoo but also when buying a car or getting a mortgage)
Speak up. Talk to your state reps, local retailers and post about it on social media
Question unfair pricing when you see it
Do you have any tips for avoiding the pink tax? Hit reply and let me know.