Money Management: How Much Do You Know?

Today’s women have a complicated relationship with money. Many women earn it. Even more spend and decide (or co-decide) what to do with it. In a growing number of households with married couples, women are bringing home more of it than their spouses.

The problem is, a lot of women don’t really feel like they know what they’re doing when it comes to things like managing money, investing, and saving for retirement. Research has shown that many lack confidence when it comes to making financial decisions.*

To address this issue – and provide students with a multifaceted, practical education – Meredith College offers resources that educate and financially empower women of all ages, stages, and majors.

An integrated focus on an important issue
Financial literacy is one of the four components of Meredith’s comprehensive StrongPoints® program.

Interim Business School Dean Jane Barnes and Professor of Business Mary Jane Lenard are two faculty members who have been working to develop financial literacy offerings for StrongPoints, which aim to teach students about four key areas:

Creating a budget and managing money

Distinguishing between good and bad debt

Negotiating, particularly involving salary compensation

Making financial decisions that will help secure their futures, including how to best pay off college debt

Meredith is rolling out the StrongPoints’ financial literacy component in a number of ways across campus, said Barnes.

Events and offerings have included October’s Financial Literacy Week; finance-related seminars; and Business 150, a freshman introductory course open to all students.

“Students track their spending, and a business school faculty member reviews those records and discusses related topics like budgeting and credit cards,” Lenard said. “The idea is to get students thinking about how these things work, so it’s great that we had more than 80 percent freshman participation this semester.”

To meet the needs of students who don’t take the basic course, Barnes has developed a one-credit financial literacy class that will be offered in the fall 2015 semester.

Some departments are already integrating finance-related concepts into their coursework.

“The dance studies program is getting students thinking about things like, for example, how much money they might make as dancers or dance instructors with their own studios – and whether they can live on, save, and pay off their debt with that income.”

The goal, she says, is to offer something every year so students can build on what they learn.

“We want students to think about career choices in terms of both what they want to do and how those choices will impact their finances,” Barnes said. “We want them to earn a diploma, as well as to create a long-term plan about how they can reach their life goals.”

Realism, flexibility, and patience are key.

“The point isn’t for us to say whether students should choose this or that career; it’s to teach them to find ways to meet their career goals,” Lenard said. One thing may be your passion, and another thing may be your job while you strive to turn that passion into a career.”

Why does financial literacy matter?

The short answer, Barnes said, is that you never know where life’s going to take you.

“You may start off with a great job in a booming field, you might be married, you might have certain household responsibilities,” she said. “But because those things can change, it’s important to have an understanding of finances.”

Gender-based wage inequality is a related issue, says Associate Professor of Economics Anne York.

“Depending on how it’s measured, women earn an average of 82 cents for every dollar men earn,” York said. “Women need to be especially diligent in managing their money, finding ways to earn more money, and investing.”

While many might assume that young adults are most in need of a financial education, women at all stages of their lives can benefit from becoming more money savvy. That’s why financial-literacy activities are open to all students – from 18-year-olds to non-traditional-aged women in the Wings program.

“With regard to things like saving and investing, the same goals apply at all ages,” Barnes says. “Even if you’re 50 years old, don’t know how to balance a checkbook, and have never saved a penny, you can start – and at Meredith, we cover the gamut about all the ways to do that.”

Whether they’re paying off their own college loans, saving for their children’s education, or managing the finances of aging parents, women of all ages can only benefit from knowing more about how it all works.

“Women are raised to think that engaging with money is somehow unfeminine,” Lenard said. “This information enables us to have discussions with the people in our lives, plan, and make educated decisions to work toward our goals.”

Being money savvy is especially important for entrepreneurial-minded students, says Barnes.

“A lot of Meredith students want to start their own businesses, so it’s critical that they know how to do things like budget, effectively use credit, and balance family and work resources.”

Tips for Financial Wellness

Meredith Business School faculty and alumnae share financial advice.

Establish credit – It’s particularly important for women to establish credit in their names, Professor of Business Mary Jane Lenard says. “Women sometimes think they’ll just turn all that over to their spouses. But if something happens later on and they need to make a major purchase, they will have to have established their own credit.”

Use credit cards wisely – Frances Theodorakis, ’80, vice president at First Citizens Bank in Kinston, N.C., advises having as few (low-interest-rate) credit cards as possible, keeping a close eye on credit card debt, and paying debt off as quickly as possible. Getting a credit card from a local bank is also wise.

“Disreputable companies sometimes have interest rates as high as 30 percent, and it’s important to be able walk into an office and talk to somebody if you need help.”

Monitor your credit score – A good credit rating is critical when it comes to borrowing for major purchases such as homes and cars.

“People should check their credit reports annually through organizations such as Equifax,” Theodorakis said. “Make sure all the information is accurate, and if you find an error, work to get it corrected.”

Save for retirement – Invest in a 401K account through your employer, stressed Theodorakis.

“If your employer doesn’t have one, establish and start investing in some sort of individual retirement account (IRA) on your own,” Theodorakis said. “The number one thing is putting something away for retirement – the sooner, the better.”

Save for child care expenses – Just as we plan for college expenses once we have children, working families must start saving for childcare expenses before a child is born, says Associate Professor of Economics Anne York.

“Some women drop out of the labor market when their children are young because childcare costs are so high relative to their earnings. That time off not only reduces their pension and Social Security earnings, it makes it harder for them to get higher wages and promotions when they re-enter the market – creating a cycle of continued lower pay.”

Negotiate your salary – Women are less likely to negotiate their salaries than men, Interim Dean Jane Barnes says. They’re more apt to accept the first dollar amount offered and to be afraid to come back with a higher number. This can contribute to a gender wage gap.

“If you don’t negotiate salary when you start a job, it often compounds itself once you have the job in that you’re not asking for the bigger raises and better promotions,” she said. “This can have a huge impact on earnings over the course of a lifetime.”

Melyssa Allen

News Director
316 Johnson Hall
(919) 760-8087
Fax: (919) 760-8330