I recently had the pleasure of reading the revised version of Suze Orman’s book, Women & Money.
I know this book has been out for a while but I was curious about the revised and updated version. This is a really good eye-opener to us as women. There are subjects that Suze Orman broaches that I wouldn’t have blinked an eye at.
Below are the biggest highlights I took away from the book because they were the most important to my current life. This isn’t everything she is discussing in the book.
If you get the chance, consider reading this version of the book. It is also offered in Audiobook format on www.audible.com.
Let’s jump in!
Stop Putting Yourself On Sale
This is literally the title of one of the early chapters. When I heard her say that I wasn’t sure what she was referring to.
Suze clarifies this phrase as under-valuing yourself as a woman to society. Within the workplace women are more likely than men to accept more work responsibilities without asking for a raise.
As entrepreneurs women are more likely to trade services with a friend instead of charging them the full fee they would charge a new customer.
A study completed by a UC Santa Barbara Sociologist Sarah Thebaud completed a study on Men and Women Entrepreneurs. The study was designed to dive into the stereotypes society places on women entrepreneurs.
Here is what she found:
- People have a tendency to systematically discount a woman’s investment worthiness and competence as an entrepreneur.
- She looked at two identical businesses, such as a pizza shop, and found women-led locations were viewed as less likely to succeed, less competent, and less skilled.
However, if a female entrepreneur had a business with an innovative plan she was automatically considered more competent and skilled than a non-innovative counterpart. When a male-led location had an innovative plan for their business it had little to no effect on the business.
I loved this chapter it made me realize I have a lot of responsibility within my current workplace. I am an accountant by day at a local hospital. I find this encouraging to-do a better job of tooting my own horn, so to speak.
We are required to complete our own self-evaluation before our managers complete theirs. I will definitely make sure I start keeping better track of projects I take on to make sure I’m getting proper recognition for my hard work.
It’ll also help me with the next section!
Don’t Be Afraid To Ask For A Raise
Time for a little self-reflection for a minute, how long have you been at your job? When was the last time you received a raise?
If you have received a raise recently, was it enough to reflect what you are actually worth?
Suze Orman really drives home the importance of getting paid what you are actually worth. She had met women who accepted a 3% pay increase when her male counterparts in the same position would’ve gotten 6-7%.
This chapter tells us we are quick to accept what we are given instead of pushing back for what we deserve.
In the past, I worked for an employer who had locations worldwide; a really big Corporate America type of company. They wanted to make the location in my city the cheapest location to run.
This meant I was working overtime hours for zero overtime pay.
I had deadlines I was expected to meet for projects that realistically couldn’t be done within a 40 hour work week. I was also only getting a 1-2% raise every year.
When I left that company I was only making $31,000 per year as a Level II Accountant. That’s right I was a Level II and making peanuts.
To give you an idea, most accountants at other companies in that position were making between $45,000 and $55,000 per year.
Instead of asking for a raise I chose to leave the company for another job.
The new job definitely paid me more but I had to start building new relationships as well as proving my worth all over again.
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Stop Ignoring Long Term Financial Planning
There are multiple chapters within this book that refer to long term financial planning. I’m glad I read the book because it opened my eyes REALLY WIDE to some things I honestly had never considered.
Long term financial planning to me is a 401k account. But to Suze Orman it is planning for your world to crumble for your loved ones around you.
Don’t freak out!
Along with having a retirement fund she wants to make sure you have a retirement fund and a Roth IRA; in your name only if you are married.
What most people don’t realize is that if you happen to experience a divorce any retirement funds in both of your names will be split down the middle.
This means selling off stocks and dividing the cash to make sure of an even split. Not everything will be sold just enough to make the divided dollar amount equal.
After this process a lot of times women discover their husbands had other retirement accounts in their name only.
His retirement is still fully funded while the wife is left trying to figure out how to rebuild what she has lost; often times having to work during her retirement years to recoup the funds.
Another long term plan is a Term Life Insurance Policy with a death benefit. This is something I never considered. This type of policy helps replenish lost income in case of death or disability.
In case of death, the money from this policy could help your spouse hire a nanny to help him with the children by getting them to school, making their school lunches, being home at the end of the school day, or basically fill in where you used to fit in.
Suze stresses that this helps the surviving spouse transition from a 2 parent unit to a single parent environment.
Sometimes these policies are large enough to help cover college costs for the kids. We all know those prices are not going down any time soon.
Create a manual on how to take care of you should you become so ill you cannot speak. I know, I know, this sounds extremely morbid. However, no one can read your mind.
I personally don’t want to live on of life support. A do not resuscitate order is extremely appealing to me.
If it is my time to go just let me go. But what this section reminded me of was my poor Grandma Bonnie.
Toward the last 5 years of her life she struggled with the part of her brain that controls speech and body movement. It was a struggle for my grandfather as well.
For years, my grandmother did everything from cleaning the house to cooking the meals.
My mom had to teach him how to grocery shop, what foods grandma used to buy for him, and even how to use the microwave. It was a complete shock when she lost those two simple skills.
But what’s worse is the rest of us didn’t know if she had a will. We had no idea what her funeral preferences were or even how to do her hair.
My mom at least knew how to do her hair.
You don’t realize how important your voice is until it is gone.
Smarter Borrowing For Big Ticket Items
This is the last subject to jump out at me from Suze Orman’s book. When she talks about borrowing smarter she is referring to 3 main components; your credit score, down payment capabilities, and the timing.
The one example that she gives is a mortgage loan for a first time buyer. Below are the questions she wants you to ask yourself in this type of situation:
- Do I have at least 8 months’ worth of my salary in savings?
- Is it the right time? (are you secure in your job, interest rates, etc)
- Can you put down at least 10% of the price as a down payment?
- Are you going to stay in the home for 5 to 7 years? (enough to earn equity in the property)
- Is your FICO score 720 or higher?
When it comes to taking out a mortgage loan Suze recommends you wait until your score is at 740 because you are offered the best interest rates for a home at that level.
When I purchased my first home my FICO score was at 720 and I was able to get an interest rate of 4%.
I’ve known someone who struggled with a severe shopping addiction. When he purchased his first home his interest rate was at 16%.
That is extremely high for a home mortgage. His FICO score was at 680 when he took out this loan. That ought to give you some idea of the difference.
The two questions listed above that I wish I had thought about were the 8 months of salary in savings and the ability to pay 10% of my mortgage as a down payment.
Why? If I were to lose my job unexpectedly then the 8 months of salary would help me keep up with my living expenses as well as keep my great credit score long enough to find a new job.
The mortgage loan I took out was $87,600 and my down payment was only $3,500. That made my monthly payments around $683 per month. If I had put down 10% (87,600 x 0.10 = $8,760) then my monthly payments would have only been $600 per month.
It doesn’t seem like that big of savings but over 30 years that is $29,880 saved.
I definitely learned from my first home purchase. Before I started reading this book I just wanted an emergency savings of $2,000 so I could pay off my student loans without any hiccups.
I think I will be rethinking how much of my disposable income I use to pay off my student loans versus what I put into my savings. 8 Months of salary for me currently would be $23,656.96.
It sounds like quite the challenge but something that would be a smart thing to consider doing.
Concluding Thoughts
I do think this book is important for women to read at least once in their lifetime.
I have an accounting degree along with 8 years of experience as an accountant and I still learned something from Suze’s extensive experience.
If you take nothing else away from this review remember this:
- Don’t put yourself on sale.
- Don’t be afraid to ask for the raise you deserve.
- Review your long term financial planning.
- Work toward borrowing smarter for big ticket items.
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