WCI #386: Changing the Narrative of Women and Money

This is the White Coat Investor Podcast where we help those who wear the white coat get a fair shake on Wall Street. We've been helping doctors and other high income professionals stop doing dumb things with their money since 2011. Hello WCI listeners.

I'm still taking some time off to rest and recover from my accident, but don't worry, I'll be back in a few weeks. Until then, enjoy this episode from one of our friends of WCI. Welcome back to the podcast. This is episode number 386, changing the narrative of women and money. We are still moving along without our fearless leader for a few more weeks. He is making incredible progress and he'll be back with us soon enough. We thank everyone for your concern and your kindness. As Dr. Dali is resting and recovering today, I am going to be attempting to host the podcast along with a great friend of WCI, S.C. gutierrez. I am Megan. I am the podcast producer and I've been pulled from behind the camera to have what I think is going to be a fantastic conversation and we will get into that shortly. But first, today's episode is brought to you by SoFi. Helping medical professionals like US bank borrow and invest to achieve financial wellness. SoFi offers up to 4.6% APY on their savings accounts as well as an investment platform, financial planning and student loan refinancing featuring an exclusive rate discount for med professionals and $100 a month payment for residents. Check out all that SoFi offers at whitecoatinvestor.com SoFi loans originated by SoFi Bank NanMLs 696891 advisory services by SoFi Wealth LLC. The brokerage product is offered by SoFi Securities LLC member Finra SIPC investing comes with risk, including risk of loss. Additional terms and conditions may apply. All right, let's jump right into our quote of the day today. This one comes from Pablo Picasso. Our goals can only be reached through a vehicle of a plan in which we must fervently believe and upon which we must vigorously act. There is no other route to success. That one certainly aligns with what we preach here at wci. Have a plan, a written plan, implement it and stay the course. I love that I get my turn to do a thank you for this episode. For those of you who are on YouTube, you may notice my background just magically changed after I finished this episode. I went home and I found myself thinking about how grateful I am for my connection to our community and that made me want to rerecord my initial thank you and our ever patient Editor gave me the thumbs up. So here it is. Jim's accident obviously came as a big shock, and with that, a lot of emotion from our team. We truly are a family here at wci, and the reminder of just how fragile life is hit pretty hard. But what has been the most amazing silver lining has been to see how quickly and everyone rallied together to make this podcast flow as smoothly as possible. So I want to give an enormous thank you first, to all of the incredible people who dropped everything to come on this podcast with very short notice. These are busy professionals who have a lot going on in their lives. And without even a moment's hesitation, every single person that I reached out to for help gave an enthusiastic yes. And I am so thankful to each of you. And second, I want to give another huge thank you to all of you. Our audience. I don't even like the word audience because we are a community. You keep showing up week after week. You send us emails, you send us thank yous, you send us corrections, you give us feedback, you leave reviews, you tell your friends, you come to the conference. That is a community, and that is rare. Thank you for your flexibility and patience as we try new things in new ways for a few more weeks until Dr. Dali is back. He and Katie and the rest of the team are also incredibly thankful to each of you. It is a privilege that is not lost on me to be part of both the White Coat team and. And the White Coat community with all the gratitude that I have.

Thank you.

Okay, we have all the technical stuff out of the way, so let's jump into our discussion. First, I would like to give a formal welcome to sc. Welcome to the podcast. Again, thank you so much for being here with us today.

Thank you so much for having me.

So we wanted to. We've been wanting to have a discussion about this topic for a long time, so we thought that while Jim is taking his break to rest and recover, that this would be an opportune moment to dive into this topic. So the purpose of our conversation today is largely to make a case for women's participation in money. We want to change the narrative of women and money, women and finances. We're going to dive into gender roles and gender norms and so much more. And so we hope that this is a super interesting conversation for you. We hope you find it beneficial. So SC is the financial master of the two of us. And I am much more new to this. I know that I work at White Coat. I sort of live and breathe the finance world. My husband's A financial advisor as well. So we talk about this stuff all the time. But I am new to becoming financially literate. So hopefully between the two of us, we will be able to cover a really big spectrum of where people are at. We want everyone to feel like they have a place at this table, no matter where you are on your financial journey, it is a journey, it is a process, and that's just how it is. So hopefully this is interesting for you all, no matter where you're at. Also, we want to say men don't go anywhere. Just because this is a conversation specifically talking about women and finances, that does not mean that this won't pertain to you as well. If you have a wife, a sister, a friend, a mother, this is an important topic for everybody.

I just can't agree more. And you know, we can talk a little bit about the research, you know, because I don't want people to think we're kind of over stereotyping here. But it is really impactful, not just for women, but that women are still lagging in long term financial decision making. But this really does impact men as well. It impacts our marriages. You know, finances are still one of the top causes of divorce. I mean, we need to address these things and it's just general well being. Right. We want our mothers to be able to be confident in their finances because often women, you know, live longer than men. There's, there's a lot of reasons that we want all the women in our lives to feel really confident about finances and to feel like they have a role in making these big long term decisions.

Absolutely. And you know, there is research out there that supports this topic that women are not as confident in the financial sphere. There's plenty of research. We're going to talk about a little bit of that so that we just, we want to be research based. But anecdotally, I think we do all know that this is the truth. You know, I think it's getting better, particularly in our community where we really are all focused on, you know, enhancing our financial literacy, changing our futures. We have a really great view of the, you know, the changes that are happening. But as a whole, my experience certainly aligns with the research that says women are just less comfortable in the financial sphere. So we're going to talk about some of that research and then we're going to break it down and just have a conversation about those findings. So sc, do you want to share some of that research and we can jump into it from there?

Sure, yeah. And we can post some of these studies in the show notes, if you'd like. But there's a few different places that we can start. There's a UBS study from 2019 that looked at women who were divorced or widowed, you know, in older age, and, you know, over 90% said that they had wished that they were involved in long term financial decision making, you know, over the course of their working years or their spouse's working years. And then, you know, looking then at that same study saying, hey, okay, millennial women, is this changing, right, from generation to generation? And it's really not more than half of millennial women said that they really weren't part of long term financial decision making. And I do want you and I to talk a little bit about what we mean by financial decision making. I think that's really critical to understand what we mean by that. But I think the level of comfort with finances, like you were saying, is also really important. There is a Bank of America study that showed that, you know, only 46% of women versus 64% of men feel like they have influence when it comes to investing. Less than half of women feel confident about their finances. And one of the biggest regret women have in finances is that 44% of women wish that they had saved and invested sooner. There's a, another journal article that found that in joint financial decision making in the household or in joint households, women are more likely to delegate decisions to their spouse. So, you know, again, these are very large kind of 50,000 foot studies. I can, you know, tell you 20 stories right now of women leading finances and their male partner being in the dark. Like, I mean, we, we can give opposite stories, certainly anecdotally and in incredible enclaves like a few that I hope you'll talk about too, a little bit more about how women can get involved in that. But within the white coat investor community, we see a lot of women who have equal participation or lead financial decision making in their households. And so it really is know, we really don't want to get, you know, bogged down into the stereotypes, but can I just give the biggest, like, thing that just kills me every time when I think about it is that in 1974, Congress passed the Fair Housing act, and that's when women could go get a mortgage on their own without a spouse or father signing with them. You have a credit card? Think about this. It's 1974. I mean, so here's the deal. When I see studies like this, I just think, well, gosh, duh, right? Like, I mean, maybe in My lifetime, you know, I was born 1980. Maybe in my lifetime, it's been perfectly legal for women to have equal decision making, to take ownership of our finances. But just because something's legal doesn't mean we have culturally changed the narrative, because the narrative was very much in place the majority of our lives. And so what I think is interesting about a conversation like this, especially your personal experience, which I think is really incredible, is what is the way that we can manufacture a new cultural narrative? How do we change this? You know, when I go and speak to groups and, you know, if high powered female physicians or, you know, women who will lead hospital organizations that have millions and millions in their budgets that they're managing, I'll have inevitably women who will come up to me and say, gosh, I really enjoyed your presentation. So interesting. I think this is great. I just need you to know, just, you know, that's just not my thing in our household. You know, my husband just manages it all. And what's interesting is that woman in that moment actually thinks that she is the only person that has chosen that. She thinks it is a unique thing. And I think we can talk again about the distinction between delegation of financial duties and household duties and long term financial decision making. I want to be really clear on what we're talking about, but in these cases, what the women were saying to me was not, this is a delegation of duties. They're saying, I'm not involved in this at all. And it's very unique to me. And what I would say is, it's not unique. What's unique is when a woman comes up to me and says, oh my God, I love that tax efficient waterfall you just talked about it are the buckets that, you know, that my husband and I or I have chosen. You know, that's always when I get really excited. Right. Because that is a more unique thing that I wish was not quite so unique.

Absolutely. And I think again, you said this, but it's so reasonable for us to be in this very cultural norm. You know, my household certainly was more. Was the traditional way. Right. My dad did all the finances. I don't even think he knew much about them, but he was the man, so he handled it. My mom was much less comfortable. And that's essentially what happened in my marriage. I got married really young, so I did not learn about finances at home. Got married young. And my husband and I both just kind of unspokenly assumed that, you know, that was his job. And that really was the, the way that it was for a Long time. And it's not until embarrassingly recently that it just dawned on me that this is my responsibility to know this too. Not only is it like my responsibility, but it feels important to my personhood to be involved in these big financial decisions. And we can get into the delegation conversation. That I think is an interesting one because I don't think that you have to be physically clicking the button, putting the money in the accounts, doing your, you know, you don't have to be the one balancing out your portfolio necessarily. It's great if you want to be involved at that level, but on a higher scale, what's important is knowing what's going on, being part of the decision making process, having a say in where your money is going and what your retirement accounts are going to look like and what is the number you need to retire. And knowing those numbers really impacted me in the way I handle money now, the way I choose to spend my money. I now have an understanding of what we're working towards. And so I get to say, is this item or this thing today more important and valuable than compound interest on that same thing 20 years from now? Like, and that actually helps me make good choices. And sometimes, you know, like, yeah, getting my nails done is worth it. It makes me feel good, so I'm going to do it, you know, and other times it doesn't feel worth it because my, my goals are more important or more exciting than whatever the thing is.

So we had a very similar kind of upbringing. So I was in a similar household where, you know, my dad led the finances and my mom was largely in the dark. I don't think she wanted to be involved in them at all. And when I look at, like, if I insert myself into what that would have felt like to her and how that did lead to lot of, let's call it discomfort. When it came to finances in their marriage, you know, for her, everything was just a big black box. Whether you're on track for retiring or not, that's someone else's job. Can I buy this shirt or not? You know, do I want to buy the shirt or not? I don't know. I want the shirt. But there's no context for. Is that within the parameters of what we can afford as a household? You know, there is, there's absolutely no understanding of where that fits in with everything. And so of course that would lead to, you know, missteps. Right? Like that's in any household, like, if you have no context for anything, then it's very difficult to do that. And so, you know, I actually talked to my mom ahead of this podcast, get permission to kind of share that. And she said, you know, make sure people know that, you know, I read your book at, you know, age 60. So I wrote a book on women and money and saving for retirement. She was like, that was the first time that I ever really learned about money. And then since then, she's created her own financial notebook. She and my dad have worked together so that she has login information, she has printouts of all of their account statements. And her level of understanding has given everything context. And so she can now make, you know, decisions that are in the context of all of their money. And so I think for her, that was a big source of comfort, something that she had avoided for her, you know, entire marriage. It ended up being the thing that she actually really, in the end, kind of loves. And so I think that's a great. Your experience, my mom's experience, you know, getting on board with this at age 60, kind of tells us that, you know, this. This kind of nature versus nurture thing, you know, we think it feels right. Like, oh, that's just not my thing. But I wonder if we are just feeding into that old narrative that tells us that that's not our place. And I would just say if there's anyone listening to this who's like, you know what? I have never really wanted to get involved in this, or my wife has never wanted to get involved in this. I wonder if we ask the question of, let's just try it for a little while, see if we like it, and I promise there will be probably a different opinion coming. Coming out of it.

Yeah. You know, I can speak to my. Again, to my own experience of not wanting to be involved was largely because of the anxiety that I felt about money in general. You know, I learned at my. In my home, you know, and again, I want to be careful. My parents were wonderful and provided a beautiful life. And, you know, somehow in my childhood, I learned that money was kind of scary or something to have anxiety about, that I had a scarcity mindset, that it, you know, was not a topic that was talked about. So. So I brought that energy into my adult life, and I really felt that fear of every time I went to purchase something, I didn't know if that was okay or not. And because I had that anxiety and that fear of, like, actually getting in trouble or something, that's funny to talk about as an adult, but it is the feeling I had, it made me more and more and more less inclined to actually get involved. That like anxiety and fear kind of just spiraled and spiraled and grew into this thing where I don't want anything to do with any of this and, and hopefully it's just all okay was largely the way I saw it. And so it wasn't until I'm trying to remember exactly what changed. I think, you know, as my husband became more financially literate, he found the white coat investor, you know, a decade ago, and he started learning how to communicate about money too. That's when things slowly started to change. And when we sat down and he was like, kind of forced me, he was like, you can handle this. Like you have the capacity to hang with me through this. And so we did and we sat down and we went through everything, all the spending, and it gave me hives, you know, looking at, you know, going through making a budget and showing me what, where all of our money lived and how much we had. And then we finally got to kind of start talking about goals. And then I started to be like, oh, I've spent a lot of money at Target on nothing. I don't want to do that anymore. You know, the anxiety went away. Becoming part of the solution was the most anxiety reducing thing, like probably in my adult life. And it was so counterintuitive to me for some reason that by understanding finances and knowing how much money we have, even if it was like less than I wanted, even if I was like, oh, I thought we had more than that, or oh, we have so much more than I thought, you know, I've had both of those big experiences throughout my life. Simply knowing changed everything so that I could make a purchase without feeling afraid or guilty or I knew better than to make a purchase because we were tight at that moment. And so the my like hope is that that message will come across that if you're somebody who feels uncomfortable or afraid or anxious or unsure about your finances, the more you dig in and understand them, even if it leaves you being like, oh man, we got a long way to go, it still feels better.

That is incredible.

It is a weird, it is great. It is incredible. And it feels really good to not be walking through my life with this low grade to high grade burning anxiety about money. Money is the weirdest thing where if you have a plan and you're executing the plan again, regardless of how much money you have, like it, the anxiety, you know, it goes away. You don't have to think about it, it can consume your every thought. Or if you have a plan, it's Just like gone, and it's awesome. And at our house, speaking of delegation, you know, it doesn't look that different now than it did before. I have a partner who loves this stuff. I call him Captain Finance. We laugh about it and make fun of him all the time. He's a huge nerd about finances. He, like, loves it. He left dentistry to go into finance. It's his passion. He. So why would I take over that? You know, like, I have other things that I am really skilled and gifted at that he's not so good at. The difference is that we sat down together, we made a plan. I know what's going on financially. I could step in if I needed to. So I'm involved, but I'm not doing the fine detail. We all are going to have things in our partnerships where some of us are better at one thing than the other. So it doesn't have to look equal. You have to be on the same page. Do you agree with that?

I totally agree. And here's the deal. I think that a lot of women who might have entered into this podcast, if we had said long term financial decision making, they would have equated that with investing. I think that the financial world has so sold this exciting crypto, beat the market. If you look at financial commercials on long term financial planning, it is so geared toward investing. And we have assumed that that is what we mean. Anyone who has listened to this podcast up to this point now understands that that is. We haven't said that word one time. We have not discussed that one time. That's not what we're discussing here. We are talking about long term financial decision making. And so what we mean here is, when are we going to be able to have the ability to stop working? That is one major big financial decision, right? Like, when can I, as a female physician or whatever your job is, like, when can I stop working? Can I stop working when I'm 55? Can I stop working when I'm 60? Can I stop working when I'M 65? When do I get that choice? Have we talked about asset allocation?

Oh.

That is so unimportant compared to, are we as a household ensuring that enough money is going into accounts so that when I'm tired or if I got sick, like got cancer or had heart disease and I really don't have the physical ability to work, am I going to be able to stop working? If I want to stop working because I want to spoil grandkids or garden, do I have that choice? That's what we're talking about here, that's big term. But then let's back up a little bit. Can we take vacations? How much can we spend on those vacations? Can I buy clothes? How much can I spend on those clothes? Can we buy a house? How big of a house can we buy? Can we buy a second house? How big of a second house? These are the questions, right? These are the questions that I think that if I were to ask any random woman on the street, do you want to be involved in making decisions about all of those things? I guarantee you 99.9% would say yes, 100%. And so I blame the financial industry for selling us a bill of goods that are not the goods that we need to be buying. And it's saying, hey, if you want to be involved in finances, we are going to have a discussion on the stocks you need to buy, the bonds you need to buy, the crypto you need to buy, the real estate investments you need to make when those things are a tool certainly for building wealth. But what we are talking about here is long term financial decision making. And what that is, is a financial plan that puts together if you're a single person household, what your desires are, if you're a two person household, what your joint compromised desires are, putting them into place and putting the money behind them so that you can reach those goals. Now that's what we're talking about. The rest of it, the investment decisions, the, which I mean, I think should have some component at least of the other spouse understanding what's going on and being able to weigh in. Maybe you have one spouse that's a little more conservative. Right. So I think it's great for two spouses to weigh in. But the logistical carrying out of rebalancing a portfolio, you know, ensuring you're hitting your federal, you know, how much you can maximize into retirement plans, like doing this. Absolutely. That can be delegated. My husband and I have to delegate. It would make no sense if we were like, okay, time to pay the mortgage, let's both sit down and do it. Okay, let's fund our brokerage account. Let's both sit down and make a transfer. Now I will say we do automate all of these things. So I'm just saying this for dramatic purposes, but we do, we each kind of are in charge of these certain things. And while we do have them, you know, automated, that spouse kind of manages the whole thing. You know, it, it is a, a very fine thing or a male spouse or a female spouse to do all of the financial kind of operational things. So I hope that we've made this kind of distinction pretty clear of what we're talking about here is find a delegate. But what I don't think is fine is for one spouse to make all decisions and another spouse to be in the dark. And I want to also make a point here. The claim is not that there is one spouse that is taking on all the finances and leaving the other spouse in the dark. Maybe that does happen. But I think what's happening here is we've taken these cultural norms and it just happens that way that one spouse does make all the financial decisions and by default the other person, by not being involved and by there not being a sharing of information, ends up in the dark. And, and that's where you're making your own financial decision making in the day to day kind of the budget decisions, largely making them in the dark.

Yep, absolutely. Okay, so let's assume, let's pretend like we've got everybody on board. Everybody who has never been interested is suddenly interested. What do we do? What's the first, you know, if you're like, okay, I'm at the beginning of my journey, I want to have a say, I want to have a voice in my finances. Where do we start?

Okay, so really great. So let's break it down. So let's say that you're, you know, you're the spouse, whether you're male or female, that right now is the one who is not, you know, the one that's in the dark.

Not feeling it, not feeling it.

Now, take it from me, you got to be a little bit careful here because if you suddenly go to your spouse after never being involved in finance and you're like, I'd like to see detailed statements of every single one of our accounts. So questions might arise in your spouse of what's going on here. So I would start by saying, hey, I've just listened to this podcast on, you know, getting involved in my finances. And the thing that they're recommending that I do is to start by having a meeting, you know, with my spouse and just learning where everything is. So that's where I would start is what are you currently doing? What accounts do you have set up? I mean, I know women and men who have retirement accounts at their work that their spouses actually set up on their behalf. Right. Got the logins, figured it out. So. So you might even have to learn what you're doing in your own work retirement plan. Great.

That happened at my house when we were first When I was first working. Guilty.

Great.

Yep.

Right. So you want to know. Right? And so I might start there. But I'm going to turn this back to you because you did this. How did you. And it sounded like maybe Tyler asked you, like, how did that first encounter happen?

Yeah, it's a good question. It happened kind of at the same time that we were doing sort of like a life summit in general, which we're these type of people. Every handful of years. We're like, okay, how's it looking? Let's go through all the categories in our life and what do we like and what needs to change? And this is a thing that we do. So I think it was kind of part of that larger discussion, but what I was going to talk about, like, yes, there are tangible, practical things that need to be done right. Start learning what accounts you actually own and where all those live and those kinds of things. But I think too, for me, something that was super helpful was just simply starting to learn. The financial industry in our country is so complicated. It's a foreign language. It's so boring on the surface. It's hard to get excited about out of the gate. So for me, what was helpful was listening to a podcast together or picking a book and reading that. You know, my Ty and I love listening to a podcast and taking a drive and listening and pausing it and, you know, an hour podcast takes us three to get through because we're. We're talking, I'm asking questions. You know, we do this on all of the topics. So, you know, just go easy. There's a lot to learn. It can be overwhelming and it can be easy to quit because there's so many terms and things that you're just like, Roth, hsa, investing, insurance. What is all of this? You know, it. It feels overwhelming. So just start slow. And I have always found learning to be so grounding and so empowering. And so by starting slowly and learning slowly, it became exciting, it became empowering. It became something I wanted instead of something I was like, all right, I should probably, like, be a grown up and figure this out. And then, you know, it started to build. And I was like, oh, my gosh, look at our net worth. It grew this. Look at our investments. Oh, my gosh, like everyone, our high yield savings account is kicking butt right now. So something that we've done that's really fun is like, look at how much interest we earned this year and say, let's take 500 bucks of that and go have a weekend in the city. So we've made it feel really fun watching those accounts grow, watching the progress happen, and then physically rewarding ourselves for it. That's been a cool thing that we've done. So I don't know, I think there's a lot of ways you can start, obviously what you said, start learning what's actually going on in your household, but then also start learning on just a more broad scale and hopefully you'll find it to be meaningful at the very least.

I love that. And like what you're talking about is actually changing even your kind of perception of money from it being boring or tedious or scary to maybe, dare I say exciting. So let's say like, so there's lots of entry points here. So I love the idea of a quarterly, like financial meeting, like household meeting. I love that idea. So you and Tyler love discussing money. I will say in my marriage, we don't. Isn't that funny?

Makes sense.

It's not fun for us, it's just for us, it just isn't. It's not life giving. I wish it was. It's just not. So what we do is we kind of take our medicine and every quarter we kind of have a meeting, we kind of lay it all out, we make sure we're on the same page and then we're done. I feel personal joy watching our net worth grow over time. And I can see that. So once you have access to your accounts, you can use account aggregation tools. There are some out there where you can have a website that pulls all of your different, you know, your HSA account balance, your 401k balance, you know, the balance of all of your accounts. It'll bring it together and you can see it over time grow and that might be really fun for you or I love your idea, like set at these quarterly financial meetings, maybe you or you and your spouse or long term partner, maybe the two of y' all sit down and say, okay, if we, you know, save this much and we over save or save or end up with more, let's have a goal of taking a vacation, you know, like so making it kind of fun to exceed your benchmarks, essentially. So we have a weekly budgeting system where we kind of do. I'm happy to talk about our personal budgeting system in our household, but we kind of have that built in. So it's. We call that gamification of money. Again, this makes money kind of fun and it changes the narrative. I also came into money because of how I grew up with a scarcity mindset and fear around money. So I have been in a lifelong pursuit of having a healthier, more positive relationship with money. And I think the financial plan, knowing what the plan is, watching us, you know, stick to the plan, the plan then working every year that has gone by has lowered my anxiety and fears around money. So I think these quarterly meetings and being able to at minimum, just watch the results of your saving and investing as part of that, watching that and your anxiety go down. Now, what I think, unfortunately a lot of people will find is that while their spouse has been in charge of the money, maybe by default, that in reality you were not saving as a household enough and scary. And we've had a lot of women and men who had kind of previously delegated their spouse to do that, start doing some reading, listening to some podcasts, understanding we need to be saving, you know, 10% or we should be saving 25% if we're a high earning household. And finding that in reality they were saving maybe in the single digits and that they may have to catch up, right? But again, better to know that now and then to have that peace of mind that, yeah, you might have to downsize your life a little bit, right? Downsize a house to make this work. But your peace of mind and now being involved in this and knowing that it's going to happen and that you're going to be able to stop working one day on your own terms, you're going to be able to take vacations and they won't be on credit card debt. These kinds of things are going to happen. I think that that can help people. I want to also mention, like, I loved your idea on listening to podcasts. There are some just terrific ones. Obviously the White Coat Investor podcast is a great one. I also think there's some great books to read. You know, I, you know, my default for any physician getting involved or spouse of a physician is to read the White Coat Investor. Just read that book and start there. There's another great book too that's like, that kind of helps people to understand that money doesn't have to be complicated, that it can be quite simple. I love this Path to Wealth by J.L. collins. And then for people who are like, I've always been scared of investing, I don't want to touch it. I really think the Little Book of Common Sense Investing by Jack Bogle. It's just a really accessible book. It can be read in the app in an afternoon, really breaks down the jargon. It's a very simple book to understand. So I think that this Self education and these quarterly meetings can get you 90% of the way to being involved in kind of the long term financial decision making.

Yeah. You know, I was thinking too as you were talking that about, you know, that if you don't know what's going on, you don't know what's going on. And I, I have had friends live that experience that you just shared. I have a couple of friends that came to mind immediately that, you know, when a divorce happened and they finally were forced to look at their finances, it was not what they thought. Or you know, on a much smaller scale, when they decided to get involved, they same thing. Oh, this is not what I thought. And I think it is our responsibility as human beings. Like we owe it to ourselves as hardworking people to know where our money is going. It was very easy to just kind of sit back and pretend like it wasn't my responsibility. But I think we owe it to ourselves. And that is, gender does not matter. That if we are working hard in our life, whether we are the stay at home parent or we are the physician or the engineer or the lawyer or whatever we are doing, you know, that if we're working hard in our lives, we deserve to have a hand in what is happening and we deserve to know. And we, it's our responsibility to know. I feel like that's an important thing to remember that we need to have a hand in what's happening in our lives and where our future is headed. That is really critical. And it took me some time to understand that.

Yeah. Like thinking about, like in what other area of our life would we see? All knowledge. Knowledge, not just control knowledge. Right. Like could you imagine if, if someone else was making all of our decisions about what we eat or what we wear or how we parent? Right. Like it's.

Yeah.

You know, you wouldn't want that. And so again, this is that I think we've been kind of programmed that one person takes all this on. But when you look at it from the perspective that we are looking at it from, like, I think people kind of say, you're right. Like we both need to be involved in that. Sure. Someone else can take on the logistics and the interest in how we invest and how we carry this out. But we're talking more fundamentally here is are you literally on track for being able to hit major life goals that would take decades to be able to stop working on your own terms? And keep in mind here, I have not said the word retirement on purpose because that is a piece of jargon. Many People do not resonate with. So what I'm saying here is if you want the opportunity to be able to, at your own decision point, be able to stop working, it takes decades. It starts in your 20s. If it doesn't start in your 20s, then it has to double down in your 30s. And then if that doesn't start in your 30s, it has to triple down in your 40s. I mean, that's just the reality. It can be done. We've seen people turn it around at all different ages, but you have to be a part of that. And so I think that is exactly right. And then can we now pivot to the other side? So we just had a conversation on how, if this is the person who has been largely kind of in the dark and not involved, how do you initiate? But if you're the one listening to podcast, let's be real, Chances are you're the one that's involved in the finances.

Absolutely right.

And you're probably going, I want my spouse involved. I would love to have these conversations. I want her or him to know what this is like, to get excited about watching our net worth grow, to build our. To set financial goals together as a team, to be rowing in the same boat. How do I get my spouse involved? She or he has really never wanted to do that. And I think this is where you really need to kind of insist and say, look, we need to make these big decisions, decisions together on money. And I would like for us to have a meeting once a quarter where I can show you everything that we have. We can. I can ask you some questions about where you want to see our life going. Where, you know, if you're working, when do you want to stop working? If you're not working, what do you want for me? When do you want me to stop working? You know, like, what kind of. How are we going to live in this same house? Are we going to upgrade our house? What are our big joint dreams that we want together? And can we put money towards those dreams together and maybe start with these kind of. This idea of a quarterly family management meeting to kind of lay that all out? And maybe this is a podcast that you can say, like, hey, would you consider listening to this podcast, you know, and. And saying, you know, I really want this for you, Would you consider being a part of it? I. I mean, do you have any other ideas on.

Yeah, you know, more. What I was thinking about as you were talking is, you know, obviously there are pros and cons to being a single person creating your Financial future versus a partnered person, creating your financial future. There are things that are awesome and challenging about both. But for those of us who are in a partnered situation, you know, we've been talking about gender norms or, you know, the stereotypes, men versus women, you know, and I thinking about this notion, like, are men inherently better at this than women? No, of course not. That is silliness. And so as I was thinking about this, the beauty of a partnership is that you are two different people who see the world differently. That is powerful and that is beautiful. And so by nature of having one person create all of the financial plan, you're losing the creativity, the insight of the other partner. Regardless of which partner it is, it's important to have the input of both. I think it will enhance your plan to have this person that you've chosen to live your life with. It will make it better if they get their voice and their vision integrated into that plan. And I think if you can talk about that as the, as the partner who is more interested and excited and trying to bring someone in to say that, like, I want your vision, I need your creativity and your input. Because without you, this is just my plan. And this is our life and our plan, and it will make it better. I am not the financial guru of our household. I never will be. But there's almost some power in the simplicity of me walking in and sitting down and Ty going, here it is, and me going, well, what about that? Why are we doing that? And him explaining it to me. And some of the things that we choose to do changed because of that. And that was me with no knowledge, you know, so. And as that knowledge has grown, we've been able to continue to that conversation and evolve that conversation. But I don't think you have to have this powerful set of knowledge to make an important and meaningful impact on your finances.

I love that so much, and I just want to follow that up. You know, we have, like, been very careful to, you know, to make a distinction that what we're talking about is long term financial decision making, that we are not equating a financial plan with an investment plan. But is this a moment where I can say, like, I do think that the world has tried to convince us that men kind of own investing. I remember taking an advanced finance class and then an investment management class, advanced finance class at Wake Forest and investment management class at MIT. And 90% of both of those classes were men. Right? We have kind of assigned that this is just a man's world, right? I think 15% of all financial advisors are women. I mean, I mean, could go on and could go on. But this is a really interesting study that has been largely replicated since it was proposed in the 90s. So a Berkeley study found that overconfidence in investing leads to over trading in the market, and then over trading in the market leads to underperformance of the market average. And so if you look at what gender is more likely to be overconfident when it comes to investing, obviously it's men. And that's what the study found, is that men tend to be overconfident, women tend to be more fearful. So when you look at their relative investing styles, you have men that are more likely to be in and out of the market, kind of, you know, trying to time it better, trying to pick stocks. Whereas women, you know, we might hold our nose and say, just get in. We said it. We forget it. And, you know, whatever happens, happens. Well, if you look at the relative performance of those two styles of investing, again, which one, which one likely ends up with more money?

Listen, we understand that over here at White Coat sc, set it and forget it. Simplicity. Absolutely. That's such an interesting. That's so interesting though.

Right? And I'm not trying to say, okay, so now all investing decisions should shift to women. That's not the point. The point is just to say, you know, again, if you are a woman and you're listening to this and your perception has always been that men are better, whether you are consciously deciding that or not. But if that's always just been kind of your understanding is that the men in your life are the ones that do it because they tend to be better at it. What I would like to say is this is why we need your voice at the table. Table is because the research doesn't support that. And so we need both. Now, women do. And I see this anecdotally. And the research also shows you can go too far when it comes to being too conservative. Right? So we'll see women who make decisions to, say, put all of their money in cash or instead of putting money into their retirement plan, might decide to simply pay off their house. And so there are problems with being able to meet financial goals when you're overly conservative and you don't have an interest in taking on some necessary risk in order to get those returns. So this is not, again, to change things dramatically. This is literally to say, hey, you might have a better role in, in this than you might think. And your conservatism, if that is what you have could be a really important moderating factor in a household when making investment decisions. But the other thing that I want to say is, you know, we have talked high level here and what I think is interesting is now kind of shifting the conversation to, okay, let's say that we've arrived, all right, We've got these quarterly meetings. If it's a two person household, we have both of those people making big long term financial decision making. We've set a savings rate together. We are going to be a household that saves 25% of our income. We're a household that's going to save 10% of our income, whatever that number is. We are making long term, big decisions together. If it's a single person household, you are making those decisions long term for yourself. You're consciously making these decisions. And let me just say that a flip side of that is you might assume that a single person is making long term financial decisions, but that's not necessarily the case. You know, you might have a retirement plan and be saving 6% in it, not because you chose to save 6%, but because you were auto enrolled at 6%. Right. So decisions are very much being made, but they're being made in a passive way. So let's assume that we have moved from one person in a household having, being in the dark or passively making decisions to this like, okay, no, we are involved in long term financial decision making. From there, how do we then execute a budget? Right. And I think again, trigger words.

Yep. Sometimes I hear budget, money organization.

There we go. Or I like cash flow management. My team doesn't like that. They do not like, they're like, stop saying cash flow management. Just call it a budget. Okay, fine, we'll call it a budget. So how do y' all handle kind of this notion of budgeting now that you've got the big long term decisions made? Let's just assume that money is just disappearing into those big ticket items, like disappearing into your retirement plans. It's not disappearing, it's being allocated into those retirement plans. It's being allocated towards, you know, intermediate things like your emergency fund. It sounds like you have a high yield savings account for that. So the money is being taken off the top because I'm assuming you pay yourself first. The money gets taken off the top, it goes into those things. But then how do you, how do you then manage the rest of it towards more short term and intermediate term decision making?

Well, I think that's changed over the years as we got better at what we're doing, and we're more familiar with where our money is and where it's going and all of that. But in the beginning, we had a really, really serious budget meeting every single month until we had a handle on, well, we went through every single charge on our credit card and anything that hit our bank account, we went through all of it. And we wanted to make sure that our spending was reflecting our values. That's a big thing at our house is like, we can spend, like, on what we care about, but let's. Let's make sure we're doing that. And so we did that. We went through every single item. We looked at the total. At the end of the month, we said, how are we doing? If we were good, then that was the end of the meeting. If it was not looking how we wanted it to look, we talked about how it was going to look different the next month. And we did that for years. And I hated it. I mean, I liked knowing, but the. But the tediousness of going through together, everything was not my favorite activity. And then as we felt more comfortable, we kind of cut it back to like, okay, we don't need to do this every month. We're solid now. Let's do it quarterly. And now it's even a little bit less than that, probably in reality. But we. At least a handful of times every year, we sit down and we make sure that. And like you said, all of those bigger buckets have been taken care of. And we sit down and we decide, you know, we look at where our money has been and where it's going, and we talk about, is this again, is our spending reflecting our values? That is our main takeaway anytime we're talking about money. And, you know, we really value travel. And, you know, recently we've said we want to travel more. So where are we going to find that money so that that bucket can get bigger? And, you know, so, like, clothes, bucket, nails, bucket that gets smaller so that it reflects our values. So it's more of a. Every handful of months, we'll have that conversation.

I love that. And, you know, I'll say that is amazing. But, you know, I would find that really hard. I mean, I would find it personally very difficult to sit down and go expense by expense.

It is.

So it's incredible. That is very applaudable. You know, I'll say in our household, the way we kind of handle that. So. So let me just back up. So I own my own business, so I'm the majority owner at Aptis Financial, and Then my husband also owns a salsa dancing nightclub. So, so he has a bar and, and then he also has some consulting work that he does as a chemical engineer. And one of the things, the practices that we have done that I think is incredible for entrepreneurs, especially your people or you know, people who own their own businesses, is you're going to have fluctuations of your pay and your income. But largely you have the expectation, hopefully over time that your businesses will make more money. And I think there's a tendency with people who own businesses that the money just kind of hits your account and then it's like, oh, we can spend, right? We have more money. Because you live in such desperate, you know, desperation. Sometimes it felt that way sometimes deprivation, right, because you're sacrificing to build your business, especially those early years that you really don't allow yourself luxury. So it's kind of fun when you do become profitable, you kind of want to, you know, to ease up. But you know what, what can end up happening is you spend everything that comes in. So one of the practices that we have that it was not intentional, it like actually just happened out of kind of almost laziness and routine, is that we would have our money hit investments first, go through the brokerage account and then we would pay ourselves kind of a just, we would just send a flat amount to our household. And so we ended up going from like a 10% savings rate that way to at times we'll hit like a 40% savings rate. So it's, it's been a really effective tool for us to make sure that our lifestyle didn't creep up because it's the other side of the coin. So you on, from a bottom up standpoint, were making sure that you didn't have lifestyle creep. What that is is that your lifestyle is just kind of going up whether you intentionally wanted it to or actually thought, oh my gosh, I feel so much incremental happiness because of the spending that we're doing. Not really. You're just spending more because the money is there. I think that's what you're saying there. So you're just making sure that from the bottom up that y' all are not experiencing lifestyle creep. We do it from the top down. So our lifestyle creep is not happening because whether we want it or not, this is how much money there is to spend. And if we want to spend more, we have to intentionally say we need to make a bigger transfer out of our brokerage account. And that's a big decision to make. So it prevents Us from having that lifestyle creep. So I think you can do it both ways. And different households are going to find either way to be kind of good. And I'll say you don't have to own a business to experience these fluctuations. A lot of physicians can, can experience this. They'll get like quarterly bonuses. That's really difficult to quote, unquote budget. So if all that money just gets deposited into a brokerage account and you're paying yourself the same amount, you can also achieve the same thing. But then there's the other side. Okay, so the other thing that we kind of do, I think together or the same in our budgeting system that I think is really cool, is setting aside buckets of money for the big things. So for instance, every month out of that money that's coming into our, our paycheck, or I'm sorry, our checking account from the brokerage account, and then we do have kind of a paycheck that comes from my company that also hits our, our checking account. So when we get that money, we instantly have money shoot aside into seven different savings buckets. And so I'll describe mine. So we've made a decision in our marriage that travel is everything. And we want to take our kids to all the national parks. So we hit Glacier national park and Yellowstone, Grand Canyon, Sedona in this summer alone. And we're making plans over fall break to get some closer by. These are expensive, right? Especially flying out of Little Rock. It's very, very expensive. So we allocate quite a bit of our resources towards vacation. So every single month we have money going into that account. We have a home repair account. So, you know, as you and I both know, you don't have home repairs until you have home repairs.

It's the worst.

It's not like your air conditioner is like, hey, heads up. In that two months we're going to bust out.

Like inoperable just happened at our house.

How much did yours cost?

Oh, we got to do our air conditioning heater and water heater all at the same time. So it was $40,000. But you may, you will know this SC that we follow the exact same plan because we learned from you. So we, we had the money in our home repair bucket. And I could have cried with joy. In a weird way, I was so relieved that it wasn't an issue because we've been doing these buckets for years now. So anyways, continue.

Well, I will say congrats. We do not have that amount in our home repair. And so that is a big reminder that we need to up that because, you know, we. I was about to lament our $5,000 air conditioner replacement.

We live in a house that has a lot of things coming for us, so we knew that we needed to front load it. So, yeah, yeah.

So we, you know, our roof is getting older. Probably in the next five years, it's going to need to be replaced. But yes, we have a bucket for that that we put money aside. You know, we had a. An estimate for $500 to fix a leak. $5,000 later, our cement completely busted up in our driveway. They found the leak. Right. So it just happens. Well, then we have a health account because we have a high deductible health care plan. My daughter just had her tonsils out. $4,000 out of pocket. Some people are like, oh, yeah, no, no, that's right. It's $4,000 for the surgery. But how much did you pay? I want to be like, I literally had $4,000 in an account somewhere and then I didn't.

That's how much I paid.

That's what I mean by it cost us $4,000 to get my daughter's tonsils out. So some people don't really. Anyone who doesn't have a high deductible.

Health care plan gets really shocked by that.

But that's the way this works when you own a small business. So, yeah, so we put. Put a significant amount of money aside into a health savings account, like an actual savings account in our bank. We have a health savings account tool that we use for investing and for retirement. But that's part of our pay yourself first. We actually have a savings account set aside so that we don't have to use our official hsa. And then we have a car savings account. I'm saving for my next car and my husband's next car. We have a clothing account because I buy clothes kind of seasonally for me and the kids. My husband just doesn't buy clothes, which is also fine. And, you know, so we have all of these accounts that our money shoots aside for that we both make decisions about. We have made decisions. This is how much we spend on all of these different things. And then we allocate that money towards them. And then whatever is left for us in our household in our checking account, that is essentially what we spend on bills and anything else. Dining out, groceries, babysitters, entertainment, you name it.

Yep. Okay, Sc, this podcast is going long. This is what happens if you put the two of us in a room.

Oh, shoot.

We will talk for a long time. I feel like we just barely scratched the surface and we need to do it again. So maybe you'll hear from us again in the future. Audience, let us know if you want more of this because we could do this all day.

All day. All day, folks.

Okay, I want to wrap it up with one last question and then we will set you all free. But what does the utopian world look like? If you know women and their finances and getting involved, what is utopia?

A utopia is getting a survey where 90% of women in their 60s say that they are so happy that they were involved in their long term financial decision making rather than the opposite. And so to me, that is utopia. This is not about women taking it over. This is about equal decision making in a household.

Absolutely. And I would add to that. I think utopia also looks like intention. You know, our motto at our house, we have a few of them. I've probably already told you a few of them today is we do everything on purpose, for a purpose. And there's great power in intention. And if you are intentional in your involvement and participation in your finances, it will change the way you view your life. I can attest as someone who has made that change. So thank you so much, sc. This has been so much fun. It's a great topic. There's so much that we could talk about and hopefully we can do it again sometime. Thanks for being here. We really appreciate it.

Thanks for having me on. I love this topic.

All right. I hope that you found that discussion to be helpful or interesting or motivating. This is just a topic that we're super passionate about at the White Coat Investor. We want everyone, regardless of where you're at in your journey, what your level of financial literacy is, we want everyone to be involved. We want everyone to feel confident and feel like they are intentionally choosing what their money is doing for them and where they're headed.

All right.

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