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Posted: May 14, 2012

For mom, the family CFO

Seven ways to improve household money management

Lisa Herhold

Mother’s Day is a time to reflect on the essential role moms play in our families’ lives, be it chauffeur, chef,  nurse or all-around nurturer. But their role as the chief financial officer for many households is often overlooked.

Mom’s financial role becomes even more significant if she’s a single parent, which is the case for 27 percent of all households with children under 18 years old in Denver, according to the U.S. Census Bureau. Whether you’re a mom or thinking about the important women in your life who are moms, this is a good time to take stock of your overall financial picture and responsibilities.

Being the chief financial decision-maker can be overwhelming if you don’t know where to start. But there are a few simple considerations that will help you better manage your family’s finances, educate them on financial matters and communicate effectively regarding money issues: 

• Keep your financial house in order. Preparing a budget, organizing your financial records and simplifying how you manage the financial aspect of your life can make a big difference. Create a system that works now, so you don’t have to worry about it later.
• Take a look in the mirror.  A good step to see how you’re doing is to track your spending for 30 days and compare essential and non-essential expenses. If you have enough money to cover your expenses you’re off to a great start. If not, look for non-essential areas where you can cut back. Cutting back on the non-essentials may also leave you more room to save for the future.  
• Prepare for life’s unexpected turns. Set up an emergency savings fund of at least six months’ expenses to protect your family in case of a job loss or unexpected illness. This will also keep you from dipping into your retirement account(s) or long-term savings in times of need.
• Don’t neglect saving for retirement. If your employer offers a retirement plan with a matching contribution, make sure you’re contributing enough to obtain the full company match. When debating saving for your child’s college tuition or your retirement, remember you’ll be hard pressed to find someone to give you a loan to retire comfortably.
• Educate your children and/or grandchildren. Schwab’s latest Teens & Money Survey found that only 35 percent of 16-18 year olds consider themselves “savvy” about managing a credit card.  But most teens are interested in learning about personal finance; in fact, 75 percent say that learning more about money management, including budgeting, saving and investing, is one of their top priorities. Use your children’s or grandchildren’s milestones, like opening a checking account or saving for a big-ticket item, to teach them about financial trade-offs as well as important concepts like budgeting, saving and how to use necessary financial tools.
• And don’t forget about your own mom. Consider checking in with your mom to see how she’s doing and whether she might need some help streamlining her financial life. In fact, more and more adult children are finding themselves in a position where their financial support is necessary, especially given the high cost of medical expenses..

Aside from these tips, it’s important for families to take time to reconnect and ensure they’re on the same page this Mother’s Day. If family dynamics make it difficult to talk about money, consider a third-party perspective. Sometimes bringing an objective third party into the conversation can help establish household roles that can reduce confusion and help everyone feel more comfortable.

For additional resources, including budgeting tools and calculators, visit . For a listing of free workshops that are available in your area, visit

Lisa Herhold is vice president and branch manager at Schwab, a position she has held for more than 12 years.  She and her staff of seven Financial Consultants work with clients of all ages to assess their financial goals and help them invest for the long term.  Lisa holds an AB degree from Brown University, an MBA from the University of Colorado, and is a Certified Financial Planner® certificant.

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