Editor’s note: I wrote most of this post when I was still pregnant with Annie (!). It’s sat in my drafts folder for more than two years, waiting for me to come back and finish it up. Today is the day! I decided the best thing to do would be to publish my original speculative thoughts and then add a little two-years-in update with how things have actually turned out (so far). I hope it’s helpful!
There were a number of topics I knew I wanted to discuss once the news was out about baby number three. There was deciding to have a third baby at all, of course, as well as the pros and cons of another boy or girl. But one I was really looking forward to? The financial implications of having a third child. We’ve discussed the intersection of money and kids a few times (here and here most specifically!), and I find it an endlessly fascinating and severely under-discussed topic. So, consider this post one part sharing our personal experience, one part encouragement, and one part practical strategizing. As always, I can’t wait to hear your thoughts. Let’s dig in!
Though each additional kiddo in a family introduces a new element to the financial picture, I think a third child is unique in a way a second or even a fourth is not. I thought I’d walk through a few common kid budget categories to share how we thought through them, and a few things you might want to think about if you’re considering having a third. I hope this post offers some hope, helpful perspective, and fodder for conversation with your spouse! :)
Housing
Let’s tackle a big one first! People have been curious from the beginning as to where baby sister will sleep. Our home has four bedrooms, so theoretically we have a room for each kiddo and one for John and me. However, it’s important for us to maintain a guest room, considering that we have frequently-visiting family who lives far away, so as I explained here, we’re planning to keep our guest room intact and add a crib to it. This should hold us for at least two years, at which time we can decide if we want to house two of the kids together, officially designate the guest room as baby sister’s room (but keep the big bed for guest visits), or consider a move to a larger home. I shared a room at times growing up and would have no problem with that scenario.
Bottom line: For us, baby number three won’t add any additional cost to the housing line in our budget. Regardless of whether we had a third child, we likely would have considered moving in a few years, anyway, so I’d consider this category a wash.
Update two years in: Annie is still going strong in the room previously known as the guest room! We’re hoping she’ll last another year in her crib before transitioning to the queen bed. June is also keen for the two of them to share a room, so we may consider bunk beds in the future. No immediate plans to move :)
Transportation
Another big one! Many people find a third child pushes them over the edge to a larger car, either to get a third row of seating in an SUV or to switch to a minivan. Obviously, this can be a huge expense.
Our take: Currently, we have a Kia Sorento. We love it! It’s a small three-row SUV, but it does not have captain’s chairs, so there’s no easy way to get to the third row of seats with two car seats installed in the middle row (i.e. they can’t slide forward with the car seats installed).
To accommodate a three-child family at our kids’ ages, we have a few options. We could invest in skinnier car seats that would fit three across. This is what Nancy did to fit three kids in their Highlander, using the Diono car seats. They’re pricy, but less than buying a different car.
Or, we could have June climb in through the back lift gate or clamber over the second row of seats. She does not mind these options – in fact, she kind of loves them – but they’re not the most practical for things like carpool pick-up lines or when we’re traveling and have the trunk packed full.
Bottom line: We will almost certainly upgrade to a larger SUV with captain’s chairs at some point in the not-so-distant future. We have our eye on the Kia Telluride. This will be a big expense that we may not have incurred if we had stayed at two kiddos, but we’re thankful to have socked away money for this expense over the last few years and plan to pay cash. Also, it’s nice to know we could do just fine with our current ride and can make this change on our own time table.
Update two years in: We placed an order for a Telluride two months before Annie was born and received it four months after she was born! Big, big Telly fans over here.
Childcare
The final biggest immediate expense! Anecdotally, I feel like the change from two to three children is when many couples feel that it no longer financially makes sense for both parents to work outside the home and pay for three kids to go to full-time childcare. Of course, this depends greatly on the age gaps between your kids and what option you choose when they enter elementary-school age.
Our take: The spacing of our children makes this not as burdensome as it could be. June will move on to public school kindergarten shortly after Annie is born, but we’ll replace the cost of her preschool with a higher rate to send an infant to daycare (in our area, this ranges from about $1,300-$1,600 per month, which is about twice what we pay for June’s preschool as a five-year-old).
Bottom line: Our childcare costs will go up slightly in 2022, but we will never need to pay three childcare costs at the same time. That would require a much bigger adjustment to the budget.
Update two years in: We made it through the most expensive year! Annie has now joined Shep at their Montessori preschool, where her tuition is less than we paid at daycare.Yes, we will be paying childcare for more years than we would have if we had stopped at two, but our budget is used to it at this point and so it doesn’t really require any additional rejiggering.
Gear
Some good news! By the time most people get to their third child, they have all of the basics covered: cribs, car seats, toys, high chairs, etc. Of course, some items may be a bit worn at this point and need replacing, but for the most part, for most people, this category should not need to add much to the budget.
Our take: This jives with our experience! We will be reusing our crib, crib mattress, car seats, stroller, travel bassinet, and more. The bigger items on our list: a stroller fan (our first one died and it’s a must for a summer baby!), a few more silicone bibs (many of ours have ripped or cracked at this point), Kiinde pouches (they’re one-time use), another hooded towel, another sound machine, and a new trike. (Our two older kids used and loved the same one that was handed down from a neighbor, but the wheel constantly comes off its track and considering how much we’ve used our first one, it would be well worth the purchase!) We’ll also buy new sheets, a muslin lovey, a few stuffed animals, and a nap quilt – sweet things chosen just for this baby girl.
Bottom line: We expect our expenses to be minimal in this category, especially because I’ll look to buy whatever possible secondhand if we don’t receive it as a gift. (I’m planning a gear redux post sometime soon, going into more detail over what we plan to reuse or try new this time around, so stay tuned for that.)
Update two years in: We had to replace our infant car seat because our original had expired, but otherwise this tracks! We were grateful to receive several of the items I listed above as gifts, so the only significant cost was the Kiinde pouches for a year of breastfeeding and pumping. Also, I did manage to write part one of that gear redux post – part two coming soon :)
Clothing
Though this is a category in which it’s easy to get carried away, the good news is that between hand-me-downs, Buy Nothing groups, and consignment sales/stores, it’s also easy to keep your costs relatively low! Of course, if your third child is the same gender as one of your first two kids, this becomes even easier (though clothes do wear out, and more frequently as kids get older – I’ve retired hardly any of June’s leggings this year, as it seems they all have massive holes in the knees!)
Our take: I cannot WAIT to see baby sister in some of our favorite June hand-me-downs!! One of the best parts about having another girl, in my opinion! Between all the clothing I’ve saved from June’s wardrobe and my sister-in-law generously sending along bags of goodies from her two summer-birthday girls, there is nothing we need to buy for at least the first two years. Yahoo! Of course, I’m sure I’ll buy a few pieces here and there just for fun, and certainly more as she gets older and more aware/independent.
Bottom line: Negligible cost at first; will need to build more room into the budget as she gets older and we’re generally clothing three kids instead of two. But again, I cannot emphasize enough the power of buying secondhand!! It’s like magic.
Update two years in: Yep! I can probably count on two hands the number of (secondhand) clothing items I’ve bought for Annie so far, and though it’s hard to resist the cuteness, seeing her in my favorite June pieces helps to scratch the itch :)
Diapers and Wipes
As these are consumable items, you can expect to pay roughly what you paid for any other child – it doesn’t matter if it’s your first or fifth. (Cloth diapers, of course, would be a different story and certainly an opportunity for cost savings over multiple children!)
Bottom line: Yep, these will need to be factored into the budget. However, it’s nice that June is completely out of diapers and pull-ups and Shep is only wearing nighttime pull-ups at this point!
Update two years in: No surprises here! Again, I’m thankful the spacing of our kids allowed for more breathing room in this budget category.
Ongoing Activities
Looking a little farther down the road, a third child does mean we’ll need to increase our budget for the routine costs and “fun” expenses associated with kids – birthday and Christmas presents, sports equipment and class fees, summer camps, tickets to events, expanding family museum memberships, adding an extra person to meals out and vacations, etc.
Bottom line: Yep! For us, this feels like one of the bigger factors when considering the financial implications of a third child. Yes, daycare costs might loom large immediately, but over the long run, this category will likely add up to much more. However, the nice thing is that it’s gradual, and most of it is discretionary – and as I mentioned, I don’t mind the idea that our kids might feel a little deprived at times :)
Update two years in: We haven’t really felt the impact of this yet, as Annie doesn’t do any activities outside of school and doesn’t even always order her own meal when we eat out. But I know it’s coming!
Long-Term Expenses
Our final budget category brings us farther into the future: we’re talking large, long-term expenses like paying for private schooling, college, cars, and weddings. There’s no doubt about it: these can be BIG expenses, and it’s straight-up addition that you’ll shell out more the more children you have.
Our take: While this category will likely represent the largest portion of the budget when all is said and done, it did not loom largest for us when we considered the financial implications of having a third child. Yes, that’s in part because many of these costs seem far away when you’re still pregnant. But it’s also because they are far away, and we’re optimistic enough to believe that our track record of saving, investing, and living below our means will get us where we need to go when the time comes.
These costs also don’t spook us because we believe there’s lots of room to be judicious with spending (and creative!) within these categories. A new car for each child at 16? Not likely – but maybe we’ll agree to match whatever they save for a car purchase. College? Yes, we’d love to help send them if they choose to go, but also know that there are GREAT and less-expensive options than a four-year liberal arts degree at a private school. A wedding? Well, you know that one is my weakness :) But just as we were creative with our own wedding expenses, we’ll be ready to get creative with theirs – and expect them to contribute, just as we did once upon a time.
Bottom line: These costs are big – yes. But to us, they’d never be the deciding factor in whether or not to add a third child to the fam. Many of the costs are gradual, can be delayed, or are simply optional.
Update two years in: Here, here! Knowing the total joy our third child has brought us, I’m glad this was (and is) our perspective :)And here’s the photographic (almost) two-year update below!
I hope this was helpful, friends! I would really love to hear your thoughts and perspectives in the comments. And of course, though I’ve tried to consider many factors, it should be said that my conclusions here are drawn from our experience with our particular three children. There are many scenarios in which the financial implications for a third child (or any child) could be wildly different – I’m thinking specifically about those who have a child with a disability or extraordinary health needs.
Can you point to anything in your past about which you remember saying, “When our budget has room to breathe/I pay off my loans/I get a raise, I’m finally going to splurge on ______”? I can think of two, and I thought it might be fun to chat about them today.
I’ve mentioned here and there the idea of our household budget expanding over time, which is both somewhat fiddly to talk about but also something I feel it’s important to be realistic about. And also, isn’t it the arc we all hope to realize over time? I’ve been writing this blog for almost 15 years – it spans from the perspective of a college senior to a mid-30’s mom – so I certainly hope my financial situation has changed over our time together. Yours, too :)
And it has. John and I have moved from a season of paying off student loans and entry-level jobs (where splitting a burrito at Chipotle was a rare treat) to a new season where we have advanced in our careers and can comfortably afford most things we want. (Though you better believe we still live by our budget – in fact, I’m thinking of updating that very old post because so many of you have emailed hoping I’d get the example Google Doc fixed up. Let me know if that would be of interest!)
Accordingly, our budget has expanded a bit, and it’s been interesting to adjust our behavior to fit it. It’s been sweet, but also has required some rewiring, some uncertainty, some resetting of expectations. For example, I was chatting with John about buying tickets to Wicked, which is coming to the DPAC here in August. I have wanted to see it for years and years and years, and I said to him that maybe we could make it an early Christmas present? To which he gently said, “You know, we can just go to a show occasionally. We don’t have to try to shoehorn it into the nearest holiday.”
And he’s right – we’ve made room for it in our budget. But old habits die hard :) Which on the whole, I’m grateful for! I’d always rather set my expectations for spending too low than too high.
There are two seemingly small things, though, that years ago I identified as milestones and said to myself, when our budget feels more comfortable, I’ll do those things. That will feel like a splurge. That will really be living, ha. They’re kind of hilarious in retrospect, but here they are:
1. Pre-peeled garlic. Many years ago – probably pre-kids – I remember having lunch at a friend’s house and watching her cook a noodle dish. She pulled a bag of pre-peeled garlic from the fridge, swiftly chopped it up, and added it to a saute pan.
I find peeling garlic to be one of those grating kitchen tasks that slows down my meal prep flow, leaves annoying bits of papery peel drifting around my kitchen, and makes my hands reek. The idea of being able to pluck a clove from a bag and immediately press it into action? The height of luxury.
Alas, I didn’t feel I could justify a $4.50 or so bag of pre-peeled garlic every week when the garlic head was $.50 and lasted at least two weeks. But about a year ago, I decided it was time, and plucked the coveted bag from the produce cooler.
And friends, it’s been as good as I thought it would be all those years. The only downside? The garlic in the fridge spoiled faster than I could use it. But I found a solution: keeping the bag in the freezer! The cloves thaw enough to slice in a few seconds, and since we’re cooking them 90% of the time, we’ve never noticed any difference in flavor.
2. A compost service. Probably five years ago, I heard about a service called Compost Now, which swaps out your full compost bucket for a clean one once a week. They come right to your doorstep – you just have to leave it on your porch. They process your kitchen scraps along with everyone else in your community, and whenever you’d like, you can request bags of dirt, or donate the dirt you’ve contributed to to local community gardens. Amazing! I thought. The price? Not so amazing. (It’s currently $39/month.)
I come from a long line of composters, and it’s something that matters to me. You may recall that we had a good long run of driving our compost bucket to the compost bins in our neighborhood community garden, but it was a hassle that did not survive the addition of a third child to our family.
Earlier this year, I decided our budget could support a Compost Now membership, and it’s been a dream. The bucket lives under our sink and the whole process couldn’t be easier – you can throw in everything from meat and bones to flour and sugar bags, flower arrangements to pizza boxes. I love that we’re able to live out something that matters to us.
In the end, I hope that that’s always what our budget expanding feels like – living into what matters to us more and more, not necessarily just adding comfort or luxury or ease to our lives (though those things are all nice, too!). I’m toying with another Marvelous Money post about generosity, our role in it and how we think about it, and how it changes over time – would love to know if that would be of interest, too.
But of course, I must know: what splurges, big or small, have you realized over time? Especially ones that are recurring versus one-time? Please share!
P.S. If you’re in an area that Compost Now serves (currently: Atlanta, Asheville, Raleigh-Durham, Charleston, and Cincinnati) and also want to splurge, you can use my link to get a $10 service credit.
Friends, I have wanted to (and promised to) write this post for years. While intimidation has kept it on the back burner (investing can be a complicated topic, and I wanted to get it right!), the desire to help and knowing I have something to share has kept it on the stove at all :)
Why? There have been a million articles written on investing, but sometimes you just need to hear it from a “normal person” – someone you trust. I hope I can be that person. Investing doesn’t have to be as intimidating and scary as it can sometimes seem!
So, here we are! My goal with this post is to begin to demystify the topic of investing for the beginner, to tell you a little bit about the difference it’s made in our life, and to give you the push you need to take the next step in your own investing adventure – whatever that might be!
Now is as good a time as any to issue my periodic reminder: I am not a financial planner, and nothing I say here should be construed as financial advice. I’m a gal who loves personal finance, has spent lots of time thinking about it, and wants to pass on what she knows!
Let’s start at the beginning, shall we?
What does investing even mean? Generally, you can understand investing as any tactic or vehicle to grow your money. It usually means assuming some amount of risk. You can invest in things like a CD (low risk), bonds (moderate risk), or an individual stock (high risk). And you can invest through vehicles like 401ks, IRAs, or brokerage accounts.
You can also invest in things like real estate, though for the purposes of this post, we’ll be sticking to financial assets (basically, money).
Why do people invest? Why might you want to invest? Investing allows you to harness the power of compound interest, which is putting your money to work for you – yes!! And when you reinvest your earnings, the pool of money you’re earning interest on grows, which begins a virtuous cycle.
Personally, investing my money is one tool in my financial independence toolkit. The more money I have (to a point), the more freedom I have throughout my life – to make decisions about how I live and give. This is motivating to me. And as a Christian, I believe it’s a part of stewarding what I’ve been given well.
Finally, on a very practical level, most of us need to save for our retirement. A common benchmark is that you should have 10x your ending salary saved if you retire at 67 (you’ll likely need more if you retire earlier). This is nearly impossible to do with the rate on a savings account (you’d have to save SO MUCH!), which is where investing helps you turn time into money (a.k.a. makes your money work for you).
The graphs below illustrate this clearly: the top one shows a growth rate of 1% over 30 years, and the bottom shows a growth rate of 8% over 30 years. The ending balance is wildly different ($216k vs. $740k), and all of that difference is due to interest earned. Both go up, but you’re doing almost all the work in the first scenario.
Do I have to know a lot about investing to be successful? Good news – the answer is no! HOORAH! And it’s a good thing, too, because most of us don’t have the will, the skill, or the time to be investing experts. If you’ve attempted it, you’ve probably realized it can take a LOT of time and brainpower to research and manage your own investing portfolio. (My hand is very much raised here! There are dozens of things I’d rather spend my time doing than researching investments and investment strategy!)
So, how to be successful? Here’s the key: you have to embrace the fact that you’re a novice, and make choices to safeguard against your weaknesses. You’re looking for something that will construct your portfolio for you, and manage it on an ongoing basis. Here are three options:
Option1: A target date fund. If you have a 401k through your work, you’ve probably encountered this investment vehicle before. They’re an extremely common offering in plans because they’re simple and they prevent big mistakes, ha!
A target date fund is an entire diversified portfolio (US stocks, international stocks, bonds, etc.) in one package. It knows when you’ll need to start using the money (your target date, or prospective retirement date) and automatically rebalances to become less risky in its investment mix as you approach that date. For example, it might start out with a 90/10 mix of stocks (higher risk) and bonds (lower risk) when you’re 25, and shift to a 50/50 mix in your 60’s. And you won’t have to take any action to make that happen!
If you choose a target date fund, that’s hypothetically the only thing you’d need to invest in! Experts consider them most appropriate for retirement accounts if your retirement is still pretty far away (20+ years?), because they are simple and not individualized to your unique needs. (After all, they only know one thing about you: when you want to retire. They know nothing, for example, about your comfort level with risk.)
This is what I used in my old 401k!
Option 2: A robo advisor. Welcome to the future! :) This is a digital investment service – just a computer algorithm, with no person behind the scenes – that constructs and manages your portfolio for you. To determine your investments, it will ask you a few questions about your situation, preferences, and goals, then split your money across investments. It will automatically rebalance your investments periodically, and may check in with you periodically, too, to see if your situation has changed.
The pros: it is more tailored to you than a target date fund, and it’s low cost since there’s no person involved. The cons: there’s no person involved :) There’s no advisor who’s taken a deep dive into your situation to help you develop a plan to meet your financial goals.
Though most people use a robo advisor in addition to their 401k for retirement savings, we experimented with using one for our mortgage payoff account. (We liked it, but are currently trying something else!) Most large investment firms, like Fidelity and Schwab, and small firms, like Betterment, have robo options to explore. Here’s a place to start!
Option 3: Wealth management. This option (the most personalized) gets you a trusty sidekick for every part of the investing journey! Your advisor will consult with you on the full breadth of your financial life (your goals, tax situation, upcoming life events, desires, preferences, etc.), and then they’ll use that to design and manage a tailored financial plan and investment strategy.
Unsurprisingly, this is the most expensive option because of its comprehensiveness and customization, and there will likely be a minimum amount of money outside of your 401k you need to have available to invest. (This amount varies, but is probably around $250k+, depending on the firm/advisor.) Often, the higher your balance, the lower the fee, so the higher your balance, the more appealing (and useful!) of an option it is.
If you’re ready to go this route, you might start by looking for an advisor wherever your 401k is housed, or ask for recommendations from trusted friends. And look for someone who is certified as a CFP, or Certified Financial Planner, the gold standard in this industry.
WOW THAT WAS A LOT! Just a few more things, friends.
What can I do to set myself up for success as an investor? A few final suggestions:
1. Honestly evaluate whether you have the will, the skill, and the time to manage your own investments. Remember that one of the biggest dangers to your investment success is you! 2. Remember that investing can feel stressful in the short term. Choose a wise strategy that accommodates your weaknesses and strengths and then check in only at designated intervals. 3. Invest consistently, even when the market goes down. That’s when you’ll get the best deals :)
What is the best way to get started with investing?
1. Start now! Start small, if needed! Remember the power of compound interest. 2. If you have a company match in your 401k, start by contributing enough to meet the match. 3. If you’re already meeting the match, consider increasing your contribution. 4. If you don’t have a 401k, consider opening an IRA. If you already contribute to an IRA, consider increasing your contribution. 5. If your retirement goals are on track, consider opening an investment account, an HSA, or a 529 plan and contributing toward another big goal.
Friends, I’d never be able to answer all of your individual questions about investing, but I hope this post has served to demystify the topic a bit. Accessing the power of the stock market has been incredibly impactful even in just our first decade or so of “adult life,” and I know that power will only grow as compound interest continues to work its magic – and I hope the same for you!! I’m most definitely cheering you on as you take your best next step, and would be happy to answer any follow-up questions below! :)
In honor of our anniversary, I have a relationship-themed Marvelous Money post for you today! (Boy, between this and my post earlier this week, I’m sure leaning hard to the unromantic side of married life for anniversary 8, ha!) Today, I thought I’d tell you a bit about our bi-monthly net worth meetings: what they are, why we have them, why we love them, and why they’re incredibly helpful for our financial progress.
What is a net worth meeting?
A net worth meeting is our chance to review our family’s finances in the big picture. We celebrate progress, check in on our financial goals, discuss challenges and opportunities, and do a bit of nitty-gritty budget upkeep. And, as you might have guessed from the name, we calculate our family’s net worth.
We hold our official net worth meetings every other month, usually in the second weekend of the month unless we’re traveling or otherwise occupied. In this season of our lives, they’re held in the afternoon while the kids are resting, or in the evening.
Tell me more about what you do in this meeting.
Well, first John calls the meeting to order, then we take attendance… j/k j/k. “Net worth” sounds very official, but our meeting is not! Generally, we like to get the small stuff out of the way first by entering any outstanding transactions into our budget doc. (We each have responsibility for entering certain cards and accounts into the doc, which we do about every two weeks, but this is an opportunity to catch up as needed and ask each other any categorizing questions.)
Once the budget is fully up to date, we’ll flip to the “Net Worth” tab of our doc. (For more about the custom Google Doc we use to track our budget, read this post! It’s a bit out of date, but the premise is still the same.) Here’s what it looks like:
Note: these numbers are completely made up, so please do not read anything into them :)
On the left, we’ve listed every single place we have money or an asset. This includes our checking and savings accounts, our IRAs and 401ks, our investment accounts, our kids’ 529 accounts, and our home equity. Yours might include other categories. For us, right now, this is a total of 20 places (I’ve simplified above).
One by one, we log into each of those accounts and enter the current amount as of that date (to be exact, one of us logs in and reads out the totals, the other is the typist). For the home equity line, we simply subtract the remaining principle of our mortgage from the amount we paid for our house to keep things simple. In cell B4, a formula totals everything together – our assets.
In the middle, you can see a column for our liabilities. Currently, this is just our mortgage, but previously we had entries for car loans and student loans. We do the same thing here – log into the account and enter the current number.
All the way to the right, a formula in F4 calculates our net worth – our total assets (B4) minus our total liabilities (E4). We also like to track our more liquid net worth, which for us is our net worth minus our retirement accounts, our HSA, and our home equity. That’s in cell F5.
Next – and this is the highlight of the meeting! – we click over to the tab next door. This tab is called Net Worth Over Time, and for us, it dates back to July 2012 – two months before our wedding, when we began having these meetings! This is what it looks like:
Obviously I have deleted the numbers, though that is our actual chart over the last 8 or so years. This screenshot only shows a fraction of the months we’ve tracked – rows 2-5 scroll and scroll to the right to go all the way back to 2012!
To update this tab, we enter the new numbers for assets, liabilities, net worth, and liquid net worth and then adjust the graph. Generally, it goes up – which is exciting! It’s nice that you’ll see the line go up whether you’re focused on paying down debt or building up savings.
That’s usually the meat of the meeting, but if there’s a challenge or opportunity we want to talk through, this is often a great time to do so. We are comfortable talking about money and it comes up regularly in conversation, so we usually don’t wait for one of these meetings to, say, talk about an upcoming trip or change in our investment strategy, but if you’re newer in the process, using this set aside time for that might be helpful.
Finally, because I know the budget is as up-to-date as it will ever be, I’ll go through it category-by-category to make sure we’re on track for each one, and adjust as necessary (of course, always making sure our total in the ISE is in the black!). Again, for more on how we budget, go here.
Why should I have one of these meetings?
First and foremost, we consider these meetings an opportunity for celebration. They’re a way to recognize the good decisions we’ve made and the willpower we’ve exercised, to cheer ourselves on to do more of those things. Saving money is often not “exciting,” especially over a long timeframe, and so we find it helpful to build in excitement where we can, to keep us motivated for the long haul.
A comment my friend Kelly made years ago on an MM post brought home why this is important. She commented that she often feels like the money she puts into her 401k “isn’t real,” since it’s taken right out of her paycheck and she basically never sees it again. While in some ways this is good (you don’t need or want to be checking in on longterm investments constantly!), you’re also missing out on a chance for motivation if the money you’re saving never becomes real to you. If you see the amount adding up over time, and watch compounding work its magic, you even might be motivated to save MORE!
Second, working toward a goal together is great for a relationship. It gets you on the same team! Whether it’s a money goal or a fitness goal or a trip you’re working toward, feeling unified in the things you want bonds you together. These meetings help with that.
The final and really important reason to have a meeting like this is so that both partners have visibility into the family’s finances. In a very practical sense, they help make sure both partners know what accounts exist, where they are held, how to log into them, and approximately how much money exists and where. No matter how duties are split, everyone should know the basics.
One final point to address: I hope this has been clear throughout this post, but these meetings are not about us counting up our money for the sake of having money. Having money is not evil, but it’s also not the point. For us, the point is freedom – freedom to live and give how we wish, to the best of our ability and for the glory of God. We also believe our money has been entrusted to us, and we want to be wise managers of it. A wise manager checks in and makes adjustments to get the most out of what they have, and these meetings are one way to do that.
Friends, I would love to hear: do you currently have a financial check-in? (And YES, you can totally have one of these if you’re single!) Any questions about our meetings, or requests for a future MM post?
