Jean Chatzky’s Money Story

The personal-finance guru learned from her mother’s example “that women can be active and extremely competent managers of money.” Now she’s sharing that lesson—and more gained over her 25 years as a business journalist and experience as a small-business owner—in a new book. By Caren Lissner

ack when she was just starting out, Chatzky’s latest book—Women with White Dog Café in Philadelphia specifi- Jean Chatzky C’86 had a hard time Money: The Judgment-Free Guide to Cre- cally to talk about their finances, even B advancing in the field of business ating the Joyful, Less Stressed, Purposeful handing out slips of paper with financial journalism because her first maga- (and Yes, Rich) Life You Deserve, pub- topics on them to prompt discussion. “I zine—Working Woman (!)—wasn’t re- lished in March by Grand Central Publish- really enjoyed seeing how the data—aca- garded as a business publication. A little ing—takes aim at the enormous financial demic and other research—showed up in later in her career, her decision to focus changes that women have experienced in the answers real women gave when in- on personal finance—jumping from a recent decades and the even more mo- terviewed one-on-one, or in the HerMon- long-sought position at Forbes to a start- mentous ones that are on the way. ey Happy Hours,” she says. up called Smart Money—was also met The book examines the ways women Both the research data and her inter- with skepticism. Writing about what think and act when it comes to getting views pointed up the fact that “women more or less ordinary people did with and managing their money and provides have undergone a pretty dramatic shift their money wasn’t quite taken seri- advice on a range of common financial in the last 25 years,” Chatzky says. ously at the time. questions and for different life-stages— “What’s happened is that there’s been an Skip ahead to the present, and Chatz- from how to approach investment strat- incredible shift in the amount of per- ky is the author of 11 books (including egies and retirement planning, to deal- sonal financial responsibility that we’re some New York Times bestsellers) and ing with finances in a modern marriage, all asked to take.” innumerable magazine articles and col- to preparing one’s kids to “launch” into She cites the widespread replacement umns, a familiar and trusted media pres- financial independence, to becoming over that period of defined benefit re- ence, and a much in-demand speaker more vocal about “getting paid what tirement plans—guaranteed pensions— whose general subject matter has ex- you’re worth … plus tax.” with defined contribution plans, includ- ploded in importance and popular inter- The book’s warm and informal tone ing 401(k)s and similar funds, which est. Besides serving as financial editor will be familiar to Chatzky’s fans, but it’s place a greater burden on the individual for the Today show and “personal fi- loaded with research findings from a to ensure their financial well-being in nance ambassador” for AARP, she hosts wide variety of sources, interspersed retirement. The situation is much the a weekly podcast, HerMoney, that is the with personal stories other women have same with healthcare, where employer- centerpiece of a business called Her- shared with Chatzky and from her own funded plans have been waning. “We Money Media, of which she is cofounder career and personal life. now have a gig economy and employers and CEO. The group’s biweekly newslet- Because talking about money has tra- backing off from [benefits] in some ter, weekly podcast, website, and Face- ditionally been taboo—something Chatz- ways, and we have to pay more of our book group have a reach in the hundreds ky thinks needs to change—she convened health insurance and [research] copays of thousands each month. groups of acquaintances in places like the and premiums,” she says.

44 THE PENNSYLVANIA GAZETTE May|Jun 2019 ILLUSTRATION BY CARMEN SEGOVA May|Jun 2019 THE PENNSYLVANIA GAZETTE 45 While both women and men contend year in high school, the family moved to marketing and admired rather than dis- with these developments, the financial Wheeling, , so he could dained pre-professional students. “Not situation for women has also changed in manage a local TV station. There wasn’t just in Wharton,” she says, “but pre-med, other ways. “We’ve got more power,” a lot of extra money, and Chatzky made pre-law—I wanted to be pre-something.” Chatzky adds. “Yes, we still have a wage note of the varying attitudes toward fi- At the same time, her journalistic ambi- gap, but if you look at educational trends nances within her family. tions were fired by beloved English depart- and the coming transfer of wealth inter- “I got an interesting mix of messages ment senior lecturer Nora Magid. “She is generationally, there’s more money in the about money. My money story was that responsible for a great deal of my life,” hands of women today than ever before.” women can be active and extremely Chatzky says. Before her death in 1991, While social attitudes and lack of in- competent managers of money. My Magid taught two decades’ worth of bud- formation have pushed women to be mother was in and out of the workforce. ding journalists to craft a tight essay with passive about money management, She was really good at [handling the a timely hook (and plenty of others to be- Chatzky stresses that women need to get money]. My father was her sounding come better writers and readers). Partici- over their fears of investing and become board. She was in charge.” pants in her legendary nonfiction writing less shy about discussing money when Chatzky was aware that money was tight seminars were also encouraged to stay in it impacts their relationships with at times, “but it wasn’t a source of strife,” touch with her and each other after gradu- spouses, children, and elderly parents. she adds. “It was more, ‘We’re going to be ation [“The Nora Network,” Mar|Apr 2013]. “Whether we’ve got $100 or $100,000, crafty and figure this out so that we can Magid helped Chatzky secure some of what I haven’t seen enough of yet is a do all the things we want to do.’ We trav- her summer internships at Advertising shift in stepping up to manage that eled across the country one summer, and Age, Rodale Press, and a newspaper in money—and manage means invest. But lunch was a package of bologna and a loaf West Virginia. “I had a resume that re- we want to,” she says. of bread, and we made sandwiches. We ate ally said journalism, journalism, jour- “By 2028, women will control 75 percent out of the back of a station wagon at a nalism,” Chatzky recalls. But during her of discretionary spending around the world playground. Did that take away from it? senior year she was struck by a malady and, by 2030, 66 percent of America’s No, it was how my parents did it.” known to many a liberal arts major: re- wealth,” Chatzky reports. Some of this is Another childhood lesson: such penny- cruitment envy. Her business-oriented because more women than men are gradu- pinching—or rather, conscious manage- peers were landing on-campus inter- ating from college, and so will likely be ment of capital resources—should be a views well before graduation. earning more, and some is simply because means to an end, not an end in itself. “I Chatzky applied to the management women tend to live longer than men and had one very frugal parent and one parent training program at the old May Depart- inherit wealth from parents and spouses. who really enjoyed spending money. My ment Stores Company. “It was in Con- Much of the beginning of the book father would splurge on things, and he necticut and paid $24,000 a year,” she talks about women’s psychology around would enjoy splurging on things,” Chatzky recalls. “I also had an offer from a maga- money, but Chatzky says men can gain says. “Sometimes in our house these days, zine called New Woman for $12,000. I insight from it too. “Just as women will when we spend too much on theater tick- went for the money. I bought a car, got a learn a lot about themselves by reading ets—which I do—we talk about this as [be- roommate, and moved to Connecticut.” this book, men will learn about the wom- ing] ‘why we work.’ We enjoy this. We’re Within three months, she knew it was en in their lives,” she says. “It’s beneficial not sabotaging our financial life in order “a terrible mistake,” she says. to us to understand our partners and to do these things. I got that from my dad.” She applied for a job at Working Woman why they act the way they do.” Chatzky also takes inspiration from her for $11,500—or $500 less than she’d passed mother’s adaptability. “She was amazing up at New Woman. Living on that income Messages about Money … at reinventing herself,” Chatzky says. “was a stretch,” she recalls. “I remember a Everybody has a “money story,” Chatzky “Years after my father got his PhD, my lot of soup at the Chinese restaurant, and writes, referring to the early experiences mother got a master’s in educational psy- it was like a dollar and it came with rice.” that shape people’s psychology around chology at Bloomington. She ran a gifted Chatzky was assistant to the business spending. and talented program in Wheeling, and editor at Working Woman. She wrote about Hers took place in the Midwest, as she taught statistics at college when we were businesses including Nike and Gap and was growing up in , , in Peoria.” read Forbes, where she wanted to work— and , where her father was a Though Chatzky majored in English but “I couldn’t get there,” she adds, because communications professor and some- at Penn, like her mother she had a head business journalists “didn’t think Working time consultant. During her sophomore for business and math. She minored in Woman was a business magazine.”

46 THE PENNSYLVANIA GAZETTE May|Jun 2019 Interviewers suggested she get an MBA, think more about balancing that with in- but that didn’t strike her as wise. Working vestments, particularly in the long-term. as a freelancer, she noticed that research Getting beyond the feeling that you don’t analysts had similar duties to business know enough about money is a good first reporters. “I figured if I could get into one step. (Chatzky has been beating this drum of those departments, I’d learn about fi- since her best-selling Make Money, Not nancial statements.” That eventually led Excuses in 2006.) She advocates becoming to a job at Dean Witter, where she earned more familiar with finance by taking 15 $45,000 per year plus a bonus—the most minutes a day to read the business section she had ever made, and more than she got of the newspaper. She also encourages hir- when Forbes did hire her a few years later. ing a financial advisor, finding that person Her next stop, which would set the di- through word of mouth and choosing one rection of her career, was at Smart Mon- who is able and willing to explain things ey, which was being launched by some clearly. The internet can be a helpful tool of her freelance contacts. One attraction as well—emphasis on the can be, since was the opportunity to pursue an inter- “We want that there is plenty of bad information and out- est in personal finance that she had al- feeling that we and-out scams there, too. Chatzky’s Her- ready developed—and that baffled some Money site contains frequently changing of her colleagues at Forbes. “I had a pa- have landed articles on topics such as job-hunting, rade of [them] coming into my office, managing money in a marriage, and clear telling me what a mistake I was making,” somewhere that answers to questions like “What does it she recalls. “When I was going into per- is solid.” mean to ‘short’ a stock?” and on other spe- sonal finance, it wasn’t a respected area cialized terminology. of journalism.” Chatzky generally shies away from dis- Smart Money’s publicist arranged for trillion in intergenerational wealth trans- cussing stocks and bonds, noting that reporters to discuss their stories on TV. fer expected over the next 40 years.” that would be a different kind of book, A Today show producer asked Chatzky What will they do with that wealth? but she does look at types of long-term to appear more frequently. “Television Chatzky notes that women more than investments, including buying property opened a lot of doors,” she says, “and men lean toward safety in their business or “investing in your own thing” like a what I did right was just walk through decisions. “One after another, the women dream business. In the latter case, she them. I didn’t say no.” we interviewed told us that what they suggests not quitting a job to start one’s wanted most from their money is … Safe- own company, but rather doing initial “No Stopping this Train” ty. Shelter. Security. Stability,” she writes. research and making mistakes while still The demographic changes involved in “We want that feeling that we have land- employed, even observing how many women’s finances aren’t limited to the ed somewhere that is solid and that no people come through the door of a store. growing number—38 percent, currently— other person has the ability to remove the Whether they are part of a couple or the who have become their family’s biggest rock from under our feet.” head of household, women will be doing earner or primary breadwinner. “More Chatzky ties this instinct to a more more retirement planning and need to be than 50 percent of women are single—and generalized sense of insecurity among familiar with the options. Chatzky is a big many will stay that way, making them de women. She cites a Gallup poll that com- fan of the 401(k) for those who are em- facto heads of households in their homes. pared how safe men and women in 143 ployed, since the salary goes into it with- Add them in, and the primary breadwin- countries felt walking alone at night in out being taxed. “In general, we want to ner number soars to 60 percent. their own neighborhoods. “In 84 coun- put as much of our money into tax-de- “And there’s no stopping this train,” tries, there were double-digit gender ferred or tax-free buckets as possible,” she Chatzky writes. “For every 100 men who gaps—and high-income and upper mid- advises. “We also want to grab any other graduated from college last year, 132 dle-income countries (like the US) had incentives or freebies (like matching dol- women graduated. Those college degrees some of the largest,” she writes. lars) that are available. Then we move on will drive increased earnings—increased In personal-finance terms, caution is to taxable accounts.” power—for women. Already half of all mostly a good thing—Chatzky recom- After contributing to your 401(k) or millionaires are women. Women are also mends keeping 15 percent of salary in sav- other workplace plan, next in line for tax- poised to inherit 70 percent of the $41 ings—but she believes women have to advantaged investments would be a

Photo by Sandra Geroux May|Jun 2019 THE PENNSYLVANIA GAZETTE 47 health savings account, a 529 plan (for newer ones like coding, it’s had an im- to do the same,” she writes. “We have to educational expenses), and a Roth IRA, pact on the wage gap. “By 2012, young help other women as friends, as col- before coming to taxable investments. women entering the workforce earned leagues, even as employers.” (On this last Chatzky also provides breakdowns for the 93 cents for every dollar a man earned. item, Chatzky recently put her money self-employed and for those whose em- Unfortunately, those gains aren’t par- where her mouth is, giving a member of ployers don’t offer retirement benefits. ticularly sticky,” Chatzky writes. her team two $5,000 raises over a week’s The best retirement funds serve the “According to the American Association time. The reason? Chatzky knew her “purpose of keeping your risk in line with of University Women, we earn about 90 work was worth the additional amount your retirement,” she says, sometimes percent of what men do until age 35,” she and “felt she needed to know it, too.”) starting with more aggressive invest- reports. “After that the number falls to ments and becoming more cautious to between 74 percent and 82 percent. At the Parents, Spouses, Kids protect principal as the person ages. And current pace of change, the AAUW fore- Women are marrying later (the average she also suggests investing in long-term casts we won’t reach parity until 2119.” age of first marriage is 27.8 years for care insurance. It’s expensive, but it can One factor comes from some women women, 29.8 for men, says the Census be acquired later in life (though she rec- taking time away from paying work for Bureau). Those in middle age right now— ommends buying “before age 60,” when childcare or to help older parents—but Generation X, defined by Pew as those premiums can go up and health problems there are plenty of other reasons. “It’s not born between 1965 and 1980—often take may make rejection more likely). just our choices that are to blame. You can care of their children and their parents. Maggie McGrath C’11 took advantage of point a big fat finger at society,” Chatzky And women are doing so more than men. the 401(k) that Chatzky offered her staff notes, and goes on to cite several egregious “More than 34 million Americans pro- while working as her assistant after grad- cases of bias, including a study evaluating vide unpaid care for a family member or uation. McGrath initially planned to de- two identical computers in which respon- friend over 50,” Chatzky writes, quoting vote any extra money toward eliminating dents said the one given the name James the AARP and the Alliance for Caregiv- her $65,000 student debt, but Chatzky was worth 25 percent more than the one ing. “The average caregiver is a 49- to cautioned her to place some into retire- designated Julie. In that study and some 50-year-old woman, working, with kids ment and emergency funds as well. Cur- others, women were as prone as men to of her own, who also spends 20 to 25 rently McGrath—who double-majored in undervalue women. hours a week caring for other (female) communications and French at Penn—is “We understand (and again research relatives … But many are also younger; the editor of the online entrepreneurship backs this up) that advocating aggres- nearly 10 million millennials are caregiv- vertical ForbesWomen. She says she knew sively for ourselves at work comes at a ers for parents and grandparents.” nothing about money when she graduat- high social cost,” Chatzky writes. “In the This means people need to have tough ed, but learned a lot through working with eyes of other people, our likability goes conversations with their elderly rela- Chatzky—and she feels lucky to now have down … but we may also not be sure that tives, as well as with other family mem- her money in a variety of accounts. we deserve it.” bers who can help, she says. Questions She cites a book editor friend who had can include: “What if someone started Narrowing the Pay Gap one-year-old and five-year-old children to notice that you’re slipping cognitive- Women would have more money to put and asked to work from home on Fri- ly? Would you be willing to let us tell aside for the long-term—or blow on the- days. Her bosses agreed, but only if they you?” as well as where elderly parents ater tickets—if they received equal pay to cut her salary by a fifth and considered want to live, and who their caregivers men, Chatzky says. Go back 30 years or so, it a four-day workweek. She accepted, and friends are in case of emergency. and women earned 64 cents for every dol- then got the same amount of work. Within marriages, differing attitudes lar a man earned—a pay gap of 36 cents. “The key to dealing with this, says about money—whether they originate in Today, women earn 80 cents to the male business strategist Leisa Petersen, is the past or present—can easily cause strife. dollar (though wages for black and His- learning to question your assumptions Chatzky says it’s good to understand a panic women continue to lag men’s pay by of what’s right, what’s allowed, and partner’s money story. She advises setting much larger margins, coming in at 63 and what’s outside the lines,” Chatzky writes. up “money dates” to discuss finances with 54 cents for every dollar, respectively). Her main message: “Getting paid is a partner, rather than waiting for a fight. As women have outpaced men in edu- good. Getting paid more is better.” Wom- In the book she talks about an argu- cational attainment and made inroads en need to confront their ambivalence ment she and her husband, Eliot Kaplan into traditionally male (and higher-pay- “about earning more money, having C’78, had as he was contemplating re- ing) fields like finance and law and more money, and helping other women tirement from a longtime position as

48 THE PENNSYLVANIA GAZETTE May|Jun 2019 Everybody Wins vice president of talent acquisition at Not earning up to your potential isn’t good for anyone: you, your family, the chil- Hearst Magazines. When Kaplan dis- dren who watch your every move, the younger women in your orbit who do likewise, or cussed leaving full-time work, she society as a whole. Research has shown that women who do earn more are more likely thought he wasn’t being realistic about to learn about our finances, take control of our finances, and be confident about the planning for the next few years. “Ugly actions that we do take. (This, by the way, makes total sense. Once you have a stake in crying—on my part—was involved,” she anything—whether it’s cards on the blackjack table or a child on the field at a soccer notes. However, Kaplan did have a plan game—you’re more likely to be engaged in the activity and invested in the outcome.) and is currently a successful career con- And for anyone who is worried about a spouse getting ruffled if you start to earn as sultant. Chatzky acknowledges that she much or more than men, know that research from Money magazine showed the oppo- probably panicked unnecessarily, and, site. In households where women earn as much or more than men, spouses were hap- “he is actually much better than I am at pier with their relationships, “as much in love,” and had better—“hotter”—sex. In fact, talking about our finances.” Money reported “the most satisfied partners of all were the husbands in egalitarian (Chatzky says he was fine with being and female-breadwinner marriages.” #justsaying —From Women with Money by Jean Chatzky. mentioned in the book, but she would have made changes if he’d objected. The two married in 2009—the second mar- to talk about money with their children nalist to entrepreneur, that ultimately led riage for both—after having met through unless the kids brought it up. And when her to want to write a new book. Since the Nora Magid Mentorship Prize, which those conversations do happen, they’re penning Make Money, Not Excuses more Kaplan cofounded and codirects and on less likely to be with daughters, she adds. than 13 years ago, her life had evolved as whose board Chatzky serves.) In the same study, “58 percent of boys it does for so many women: she’d gotten She says couples should “find a system [said] their parents are having conversa- divorced, remarried, watched her kids that works for you,” rather than feel tions about financial goals with them, grow up, lost a father, and “about a de- pressured to combine all accounts. Some compared with 50 percent of girls.” cade ago, I became one of the more than women keep individual accounts and 6 million Americans who start a small credit cards in just their names, while Where HerMoney Goes business each year,” she writes. sharing others. Among the younger set, the reluctance Those experiences “made me more To raise children who can handle mon- to discuss money matters may be fading. conscious of the important role that ey wisely, start early, Chatzky advises. Newspaper articles in the last two years money has played—and continues to “We want to give our kids the advan- have noted that millennials love to chart play—in my own life. But, as a woman, tages that come with a comfortable life,” and discuss their spending through the it’s also made me more opinionated she writes. “Yet we don’t want them to popular “Money Diaries” feature on the about the best ways to think about and lose respect for those advantages or not website Refinery29.com. (Chatzky’s for- interact with money in order to get it to understand that they require hard mer assistant McGrath says she’s read produce the best results.” work.” She suggests “establishing a run- the “Diaries” and describes them as “voy- She thinks that societal attitudes to- ning dialogue throughout their lives,” by euristic catnip” for her generation.) ward women with money will continue doing things like explaining to a young And as the accessibility of the internet to evolve, as will women’s confidence in child in a grocery store why parents are helps lessen the taboo around talking commanding more of that money. choosing to buy the brand that’s on sale. about finances, it’s helping Chatzky extend “It’s ironic that although women have Older children can be encouraged to her reach. The success of the HerMoney more money than we have had before, save or work toward a goal. podcast has led her and her producer to we can’t stop doubting ourselves,” she And experience can be an effective—if launch a private Facebook community says. “If we can get over that—essen- sometimes painful—teacher. In one case “where thousands of women come to- tially stop doubting ourselves, take the Chatzky recounts, a mother gave her gether with us to help each other dissect bigger job, think about the bigger invest- three children enough money to cover questions about their financial lives and ment, believe we can do this—it’s not utilities for a year and advised them to cheer each other on,” she says. “And that, only going to make us stronger, it will “be smart.” Two were, but one wasn’t— in turn, led us to launch HerMoney Media make us safer and more secure too.” and ended up moving back home. last fall, led by our website HerMoney.com. Parents should also make a point of dis- We publish two newsletters a week, and Caren Lissner C’93 (carenlissner.com) wrote cussing money with their kids. She cites a have hundreds of thousands of readers.” about Bloomers for the Jan|Feb issue of the T. Rowe Price survey showing that two- Chatzky says that it was these experi- Gazette. Her first novel, Carrie Pilby, was turned thirds of parents said they were reluctant ences, and her own evolution from jour- into a romantic comedy film currently on Netflix.

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