Are You a Beverly Hills Housewife?

I will go out on a limb here and admit I watch Bravo T.V.’s  Real Housewives of Beverly Hills.  I'm disclosing this because I just finished watching Episode 11 of Season 11 and am shocked at what I heard. This season's storyline centers around Erika Girardi, who is going through a divorce from a very wealthy attorney accused of embezzling his clients' monetary awards. While that allegation is horrible, as a financial advisor, I'm honestly more flabbergasted at how little these very wealthy housewives know about their money.  I quote, from housewife Erika, "I just learned how to go into a bank in March...I didn't know how to deposit. I never had a debit card, but for 22 years, it was not my life.”  Another Housewife chimed in, saying she didn't know how to use one either!  It's a whole new world for these ladies.  And it shouldn’t be!  My question for you is, Are you a Beverly Hills Housewife?  Do you ignore your family finances? Do you know how your spouse is spending money?  Do you know how to deposit your money into the bank?!? 

Marrying Prince Charming.

Many of the  Beverly Hills Housewives (BHH) married their "Prince Charming" and now spend their married lives oblivious to how the family money is made and spent. For example, upon being asked, did you get an allowance?  Did you and Tom share everything? Erika admitted, "All of that was kept very far away from me.  Life was on credit cards and cash.  Tom was doing all of that. I wasn't privy to all of that."  Another housewife admitted that she had to hire a forensic team (I thought they were just for CSI?) to discover where all their assets were located during her divorce proceedings. Both women didn't pay attention to what their husbands were doing with the money and were completely unprepared for the unexpected; divorce. Then, in true Beverly Hills housewife fashion, after this enlightening conversation, we see them shopping and drinking champagne, acting as if they hadn't a care in the world. 

Before I continue criticizing these ladies on their lack of marital, financial awareness, I have an admission of my own.

I, too, married MY Prince Charming!  At the age of 24, I went through a divorce. I had married a man who couldn't keep a job and earn a living. After my divorce,  I vowed that if I married again it would be with someone who would carry his weight in the marriage, partnering with me to raise a family. A few years later, I was blessed to fall in love with such a man.

Yet, here's my BHH admission; I acted like a Beverly Hills housewife at the beginning of our marriage. I got so caught up in feeling “taken care of” and not having to worry about money, as I had in my first marriage, that I completely ignored our finances, leaving it all up to my husband. (Ironically, I was a financial advisor at the time.)  However, once I left my career to raise a family, I started paying attention to how we spent, saved, and invested.  I was solely dependent on my spouse for money and since security is important to me, I knew I wouldn't feel secure until I understood where every dime was spent. So, I took over paying our bills and partnered with my husband in managing our investments.  Today on a monthly basis we review our spending against our budget and discuss our investment strategy. It actually frightens me to think how I could have easily remained oblivious, raising kids and spending money without a clue. Thank goodness I took action and am now in a better position to deal with the unexpected.

How to avoid being a Beverly Hills Housewife:

You may be thinking to yourself; I am too busy working, raising kids, or I'm just not interested to understand our finances. But, I am here to tell you, for the sake of your financial future and to be ready for the unexpected, you NEED TO KNOW!  Ladies, I can't emphasize it enough, whether you and your spouse are worth $200 or $200 million, know your family finances.  By finances, I mean checking and savings account, investment accounts, retirement accounts, monthly spending, and assets owned and your estate plan.  Here are five steps to get you started in learning about your finances:

Step 1) Create a net worth statement-this is where you list your assets: checking balances, saving balances, investment accounts, home, car, and list your liabilities such as your mortgage, credit card debt, car payment.  Subtract your liabilities from your assets, and you have your net worth.

Step 2) Make a list of your accounts and account numbers and lock them safely away where you can find them when needed.

Step 3) Create a will to be sure you know where your assets will go when you or your spouse dies.  Check all accounts that designate a beneficiary, such as IRAs, to ensure you are the primary beneficiary of your spouse.

Step 4) Review your cash flow every month. Take turns paying the household bills to understand how much money is coming in and going out.

Step 5) Review your investment accounts with your spouse and annually with your advisor and ask why we invested in this?  How has it performed? 

I will continue to watch this season of the Beverly Hills Housewives. But, by the end, I hope the housewives become savvier about their finances, after watching what Erika has gone through.  Erika is a strong woman and will bounce back just as many of us have after going through a divorce or widowhood. For the rest of you, don’t wait. Start with the five steps above and sit down with your significant other and discuss your finances so you can be completely prepared for the unexpected!

If you would like a partner to help you become more confident about your money, I invite you to schedule a free initial consultation with me and I can help you start your journey toward savvy money management. 

Marathon Wealth Management, LLC is an Investment Advisor registered with the State of Washington. All views, expressions, and opinions included in this communication are subject to change. This communication is not intended as an offer or solicitation to buy, hold or sell any financial instrument or investment advisory services. Any information provided has been obtained from sources considered reliable, but we do not guarantee the accuracy, or the completeness of, any description of securities, markets or developments mentioned. We may, from time to time, have a position in the securities mentioned and may execute transactions that may not be consistent with this communication's conclusions.