In November, we held our first “Let’s Talk Money” discussion. The idea and support came from a longtime supporter of Minnesota Women’s Press. Jeanne Gilles, who wanted to bring together a diverse group of women in a social setting to address questions about money that we’re sometimes reluctant to ask — or don’t know who to ask. As a financial planner, Gilles knows the difficulty women can have in meeting their individual and collective needs due to money problems.
We gathered a small group for a two-and-a-half hour conversation at a downtown restaurant owned by entrepreneur Kim Bartmann, intending to discuss more about entrepreneurship, long-term investing, and other topics raised by the group, such as developing better financial literacy. for youth.
The group of 12 included Gilles, two members of the Minnesota Women’s Press team, a woman in contact with those returning from incarceration, three women leaders with lived experience in foster care, someone who teaches literacy financial secondary school and two women from the Association. of Black Economic Power (ABEP) – launching a Black-led credit union.
Discussion topics
- Can we establish a healthy lens for children from families who have experienced financial trauma, perhaps encouraging ideas of entrepreneurship and other basics of financial literacy. Many women in the discussion said they didn’t have role models who taught them what to do to build credit, save for a car or find stable housing. Future Discussion Topic: How can we develop a financial literacy system for those who don’t have it at school or at home?
- Karen Washington ABEP said his vision for others is to find passion and purpose to succeed financially and emotionally. She says her question to others is “tell me what you’re passionate about” and advises that career and education are about “discovering, not deciding.”
- Deneal Trueblood-Lynch is a reentry facilitator with Goodwill. She said some of her clients re-enter the country after 20 years in prison, with expired or prison-issued clothing. They receive an “entrance fee” collected while incarcerated to help them get started again, but it can be daunting to know how to get started again without falling back into old habits with old friends to quickly access more funds.
- Lola Adebara, founder and CEO of Partnerships for permanence, works with high-achieving young leaders with lived experience in foster care and adoption who set goals over a twelve-month period within a support group of professional women who share the same same ideas. The Leaders Changing the System program, in collaboration with KARA Fin Lit, creates a network of women facing financial barriers, solving credit problems and achieving their goals.
- One participant noted that anyone from a difficult background or living in survival mode needs to take care of themselves, which might mean getting their nails done without feeling guilty.
Challenges discussed
- Being part of the sandwich generation, caring for children while caring for aging parents. One woman said she was essentially working four jobs simultaneously; It has been difficult to set boundaries to carve out time for self-care.
- One woman said that after being placed in six foster homes during her childhood, she learned what she now knows about finances from TikTok videos.
- There is a significant gap that many people don’t understand when it comes to the security that even modest generational wealth provides. In the 1950s, predominantly white, middle-class families benefited from government-funded homeownership and college educations, which were then passed down to future generations. Other families had far fewer opportunities and resources, including if they served in the military.
Finally, the discussion led to reflection on the topics “What I wish I had known sooner”:
- Understand the difference between wants, needs and wishes.
- How Compound Interest Works
- Put your money where your heart is: socially responsible investing is the future
- What help and support did people need to get to where they are? Sometimes we need help getting back on a stable financial footing, and more people need to understand that it’s okay and more common than we think.
During the conversation, it was acknowledged that it was strange that talking about money was a taboo among women. How can we teach each other if we don’t discuss it? We can also do more collaboratively to teach the next generation.
Solutions
- Involve multiple generations in aspects of care, so that children participate in the role of caretaker to elders, and vice versa. Putting yourself in the center as the sole caretaker is a recipe for burnout and does not allow others the dignity to be of service. This requires asking for specific help.
- Automate bill payments and make it a habit, like exercise, to create and review a monthly or weekly budget to track money. Also automate savings to make them easier and simpler.
- Gilles said women tend to be smarter investors and have better track records than men in general, according to statistics. However, they tend to be afraid of taking a risk or making a mistake when choosing an investment. If $25 a month can be put aside into an investment, it can make a huge difference in the long run. The goal is to let it sit for more than ten years.
- Gilles said investing funds in a Roth IRA is a smart way to save for a home because you can hold the funds tax-free for five years and then withdraw $10,000 without penalty if used for purchasing a house. To avoid private mortgage insurance (PMI), Gilles suggested, try putting 20 percent aside. If this is not possible initially, the PMI can be canceled as soon as one has 20 percent or more equity. As a general rule, you should use no more than 30% of your income (minus existing debt payments) for a mortgage. It’s important to be realistic about what you can afford in the long term.
- There are capital gains and estate planning benefits to review in detail with a financial planner, even if you believe you have a modest lifestyle. For example, a transfer on death (aka TODD) transfers ownership of the home to the person listed on the deed. This avoids probate and gives beneficiaries a better tax break. (Their basis in the house is not what you paid for it, but what it was worth on the date of your death if they decided to sell it).
- Putting money in a rolling CD is a good short-term investment because it’s like a liquidity ladder: you can withdraw money from it in an emergency. Also consider an online savings account, which has a lower investment entry point than a Treasury bond.
- When paying for college, Gilles recommends that parents first take care of their own retirement before providing children with funds for college. This gives them “skin in the game” for their own education. Parents can choose to pay the loan interest accrued over the year. The 529 plan is a good option for saving for long-term education goals because it is a tax-free investment (if used for post-secondary education) that can be passed on to a beneficiary specifically for studies.
- College is not for everyone. There are solid jobs in professions that pay well, and the 529 plan can be used for this purpose as well.
- Community Land Trusts allow collectives to purchase land in a city so that someone can purchase property there without the additional expense of land; equity builds up in the home which is then shared with the owner moving to a new property and with a new owner.
Plans are currently underway to develop future “Let’s Talk Money” conversations. If you would like to be a part, contact Crystal@womenpress.com