The 'Math Ain't Mathing' & Other Thoughts on Money
You know the list of things that people tell you not to discuss at gatherings: politics, religion, parenting techniques, money … etc. Whoever these people are, they say it’s impolite, can lead to arguments or resentment, and the topics just shouldn’t be broached.
I feel like, and I could be wrong here, that we are now in an age where those exact discussions are what will save us and will move us forward. As long as the people engaging in the conversation are empathetic, leading with understanding, and genuinely care about valuing the person on the other side of the conversation, I don’t see why we shouldn’t be hearing other people’s opinions and viewpoints on the very things that have a deep impact on our lives. I especially think this in regards to conversations about money — how much we’re making, what we’re investing in, what are we doing about retirement, how are we paying off our debts, when are we budgeting and planning vs. flying fast and free with our payments?
Money is deeply personal. Many people derive their personal value from how much they make and the type of lifestyle that can afford them. Often in the career space, it’s common for people to say, “don’t tell people what you make,” or “don’t share about that bonus you received.” But, when you’re working in close quarters, can see each other’s outputs, and have an understanding of how everyone impacts the team culture, it can be important to know ballpark figures on what folks are making — especially when considering that many women still make less than men for doing the same job. There is an immense amount of value in understanding the financial deals (for lack of a better word) that are taking place in an organization:
Are moving expenses negotiable?
Can I get supplemental pay if I take on additional work during someone’s parental leave?
How do yearly merit raises work? Can we all get the optimal 5% maximum, or does that pot of percentages have to be spread out?
What is the true salary range for my position and what would advancement look like in the long-term?
Has there been continuity in job postings on financial offerings?
Do I have to invest my retirement in the company pension plan, or can I do it through another financial organization?
Many of these items, we don’t know until we ask about them. And often, if not for someone else mentioning it, we don’t even know we should be discussing these opportunities. Over the past few years I’ve gained some great insight and awareness from being able to talk with trusted colleagues and women I admire about money, about our salaries, even about our mortgages and car payments. Because we derive so much value from our income and spending, it can be isolating to work through those money anxieties and excitements alone, especially if you’re a single income household or didn’t grow up with the best example of financial management.
Because this is something I’m really passionate about, I wanted to share my top 5 money realizations/values/philosophies that I’ve come to covet in my 32 years of spending and making money.
Please note that I am not a financial advisor, don’t have my MBA, nor is the information I’m sharing something you should take lightly if you consider it in your own life. It is truly just realizations I’ve had for myself and how they’ve worked out.
Everyone is different and everyone’s situation is different.
DO YOUR RESEARCH & NEGOTIATE YOUR SALARY
This is pretty obvious, but knowing what the salary range for the type of position you’re pursuing, as well as what folks with similar experience are making, is essential to properly negotiating your salary. I worked with someone a few years ago who asked me to help with their job application and cover letter. She was applying for a job that she hadn’t worked in in quite some time, so wasn’t super sure what the hourly rate was for that type of work. Together, we did some research on the specific position, positions above and below, and similar types of companies to put together an “expected salary/hourly rate” for her cover letter. We threw an amount out into the air that was higher than she would have accepted, but felt confident it was the right range … AND SHE GOT IT! She got it because she was the best candidate, and she set the expectation of this is what I believe the market rate for my skillset and knowledge warrants. Additionally, almost everyone offers an incoming candidate something lower than their budget allows. (I hate that this is how it is — why can’t we just offer the highest amount that the person brings to the organization?!) So, they expect you to negotiate and to counteroffer their initial salary or rate.
SET A ROUGH BUDGET & SPENDING PLAN
I say rough, because I’m not one to input every purchase I make into a spreadsheet, nor do I follow any type of zero-sum system. If there are things we want to save for, additional debt we want to pay down quicker, or just something funky happening with our finances, my husband and I will take time together to look at our income, our fixed expenses, and the extra things we’re buying to develop a deeper plan on how we’re going to move closer to our goal. We create a new one just about every year and adjust it to what’s important in the right now — new priorities and opportunities pop up every now and then so we want to make sure we’re benchmarking on our present circumstances. It has consistently shown us where we are spending too much money (eating out and grabbing coffees), where we could probably make some switches (going to a grocery store vs. an everything store for weekly groceries), and where we have additional margin. It’s really illuminating to see where your money is going and whether it lines up with your financial values at the time. For example, if I know that I want to put an extra $400 away each month for a trip, then I may find that I want to drop our monthly grocery budget down from $800 as a significant option; then I’m going to concentrate on spending $100 each grocery trip, rather than just throwing stuff into the cart because it looks good, or I think we used the last of the peanut butter.
IT’S OKAY TO GET THE PART-TIME JOB
There is no shame in having a full-time 9-5 position and also carrying a part-time job on top of it. If that’s what needs to be done to realize your money goals, create some margin in your monthly budget, or save for something spectacular, you do you girl! It can be very reassuring knowing that you’ll get an extra $200 every month to save or spend on a goal because its separate from your normal spending habits. I’ve used part-time jobs as my ticket to paying down my student loan debt or saving for vacation, and it has made all the difference. It’s also nice to have a little something extra to stash away for the future. Being a sales associate in retail, supporting a friend in their small business, working a front-desk at a hotel on Sunday mornings, mowing lawns in your neighborhood, I’ve found that it doesn’t have to be something you’re super passionate about or a new career goal (of course it could be if you find you really enjoy it), just something that helps you move closer to meeting your financial goals.
DITCH THE SUBSCRIPTIONS
I’m not minimalistic in nature, but man, do I hate paying subscription fees. Whether it’s for television streamers, iCloud storage, meal services, or literally anything else. I always ask myself if the value that it’s going to bring into my life actually worth that money going out of the checkbook. I also hate the idea that two coffees worth of money is flying out every month for an additional service that I barely watch. Before signing up, I just always think critically about the types of services, which shows, how many meals … etc. I’m actually going to use, and if I can wait until something new comes along and batch that content together, then I will. I also always write on the calendar when it renews so that it’s top of mind to cancel it. I feel like it keeps me a little bit more cognizant of where my money is going and whether I’m actually using it.
BUYING USED DOESN’T MEAN YOU’RE POOR
And who cares if it does? (I also hate the term poor, but couldn’t come up with a better descriptor) Over the past few years, I’ve really tried to adjust my thinking on buying used or pre-owned items versus buying their brand-new counterparts. My husband and I have always had used cars, 1. because that’s what we can comfortably afford, but also 2. because the amount of anxiety of knowing that I am spending someone’s yearly salary on a vehicle that at any moment could be damaged by humans, animals, or an act of God, does not sit well with me. I’m getting anxious just thinking about it. While that is car specific, I feel the same way about other items. I’d rather mend a coat that I love and that’s carried me through interviews and important meetings, than add it to a landfill and buy a new one that will eventually also end up in a landfill.
Will I win a Nobel prize for my thoughts on money — clearly not, but as eggs go off the shelf, the price to heat and cool our homes continues to raise, and the ever glow of social media must-haves shines bright, these are some of the true philosophies that I hold tight to when making a decision about where to spend my money, how to afford something I love, and whether the value that I’m putting into my work is being fairly compensated.
**Also, a note that if you don’t have the same philosophies I do, love your brand new Honda Civic, or would never set a budget — you do you, girl. I’m not here to judge and you’re probably doing something better money-wise that I could take a lesson from too! Information is power and if one thought process can enhance someone’s feelings toward their salary, the money they’re spending or how they’re saving for the future, I’m all here for it!!
I would love to hear from you! What’s a money philosophy that you stand by?
All my best,
Skylar