Ms. Financial Literacy

Financial Journey, Girlfriend to Girlfriend Money Chat, Personal Finance

When Might You Want to be Honest with Friends about Your Financial Constraints

As promised in this post (click to view), I’m now sharing an update on how I have been working to overcome my fear and making efforts talking with my friends about personal finance.

About two months ago, I found myself feeling stressed. It was around back-to-school week, and several of my stay-at-home-mom friends all wanted to get together with me around the same time. And all of them suggested going out for a meal. I felt conflicted. On the one hand, I wanted to say yes to getting together, but my social budget was limited at the time.

Early in 2016 when my husband and I decided on a FI date (financial independence), we became even more conscious about money and spending. Prior to that, like many of my peers I looked forward to every social gathering where food and drinks were involved. I’ve always been a foodie, and hanging out with friends over delicious food was my idea of a great time. However, once my husband and I decided on a FI date, I drastically changed my spending habits and my views on spending in general. And not all of my friends are aware of this new change yet.

For that same reason, I struggled. I didn’t want to make up excuses to decline the invitations. I was concerned that this drastic change in behavior might have my friends thinking I was no longer interested in spending time with them (I used to say yes to dining out almost always.). I didn’t want my friends to think I was rejecting them. And if I were to share with them my lack of desire to do social spending, would I make them feel uneasy? How would my friends feel about the changes I’ve made in my life recently (where spending is concerned)? Will my friends support me? I had all these concerns and questions in my head. I really wanted to avoid social awkwardness!

money constraints girlfriend to girlfriend money chat

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Financial Planning, Work and Career

Health Insurance: When One Plan Doesn’t Work, Know What Your Options Are

This post is part of a series: Maximizing Employee Benefits to Increase Financial Security, where I encourage you to maximize your employee non-wage benefits as a way to increase financial security meanwhile protecting your financial standing. As promised, I’m devoting individual posts sharing my thoughts and experiences on the various types of benefits.

Today’s topic is health insurance plans. I’m not here to convince you which health plan or option is better. My goal is laying out the various choices I’m familiar with and sharing the lessons I’ve learned. For instance, I learned that a plan coverage with the lowest premium is not for me, despite being healthy and young. For months, I didn’t sleep well. Luckily, I didn’t have to spend thousands of dollars before I learned what my risk tolerance level is! I hope you’ll reference back to this post as you make benefits selections in the future.

My employer offers two types of plans: HMO (Health Maintenance Organizations) and PPO (Preferred Provider Organizations). Within each plan type employees can choose either the basic or buy-up option.

health insurance employee benefits financial security

HMO

When I first started working I chose the HMO plan because of its lower cost. Within this type of plan, the basic option is offered to employees at no cost (with a $500 deductible and limited benefits coverage). On the other hand, the buy-up option costs employees a $32 monthly premium (with no deductible and extra benefits coverage). [#1 Lesson learned: In general, lower insurance premiums mean higher copayments and/or deductibles.] I like the HMO one-stop services business model due to its convenience. I’ve been able to go to the same building to visit my OBGYN, then take my daughter to see her pediatricians on another floor. There’re optometrists, laboratories, physical/occupational therapists, pharmacy, etc., all providing care under the same building. I also like having all my medical records at one place.

One drawback I’ve encountered thus far is that the plan limits me to a group of primary care doctors and specialists who’re affiliated with the plan. [#2 Lesson learned: Most HMOs offer limited choices of doctors.] While I’ve been happy with my primary care doctor, it wasn’t the case when I needed to see a physical therapist. At the time, there was only one PT who specialized in the care I needed (unless I was willing to drive to another city) and I wasn’t happy with the service she provided. Luckily, my exercise injury recovered quickly and I was able to say good-bye to that relationship. This limitation is definitely something I consider each year during Open Enrollment time. Another drawback of this plan is that out-of-network doctors are not covered, except in medical emergencies. If you travel a lot, this plan is probably not for you.

Basic vs. Buy-up Option

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Financial Journey, Financial Planning, Work and Career

Maximizing Employee Benefits to Increase Financial Security

maximize employee benefits to increase financial security

Readers, what are some of the things you have been/are doing to increase your financial security? Increasing income? Minimizing spending? Getting into another career path? Starting a side hustle? Building a large investment portfolio? Acquiring rental properties? For those of us who are receiving W2 income, do you rely on your employee non-wage benefits (such as insurance and retirement benefits) for financial security? In this post, I share how I used to perceive my employee non-wage benefits, how I came to see their true values and why choosing the best benefits options for myself and my family is a great thing I can do to increase my family’s overall financial security.

How I Used to Perceive My Employee Non-Wage Benefits

For a long time, I took my employee benefits for granted. I used to only focus on the numbers on my bi-weekly pay statements. I could actually do something with my W2 earnings (such as purchasing more stocks and paying bills). My non-wage benefits were something that my husband and I typically looked at few times a year, and then they were forgotten until we needed to reevaluate the benefits options again. It wasn’t until earlier this year (2016) that I realized how much those non-wage benefits contribute to my overall financial security.

As a new employee, I loved reviewing my employment benefits. I thought it was so cool that my employer was paying me while I went on vacations, giving me extra money toward my retirement savings, offering me discounted life and group disability insurances and allowed me to take eight months off to spend with my daughter after her birth (and I also got paid during part of the time off!). The list could go on. I felt great having all those “freebies” that came with my employment compensation. While I appreciated my employer looking out for my well-being and that of my family, for a long time I never realized how much I’ve came to depend on those non-wage benefits for peace of mind. I suppose I didn’t or couldn’t see the true values of those benefits when I wasn’t paying the premiums out of my pocket or no monetary values were placed on them. What I couldn’t see didn’t count, right?

How I Came to See My Benefits’ True Values

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Financial Empowerment, Financial Independence, Women and Financial Literacy

Putting Women’s Financial Independence at the Forefront of Advocacy and Philanthropic Work

women financial independence financial security self-reliant

Running this blog is a passion that’s second nature to me. If my resume is an indicator of what I value and what I’m passionate about, it would say that I’ve been a strong proponent of advocacy work. I’m grateful for all the leaders who are volunteering their time, energy and money working tirelessly turning their visions into realities. It’s no surprise then that once I created a Twitter account, I followed @MelindaGates and @LeanInOrg. I enjoy being part of this inspirational and uplifting community. As for myself, even though Ms. Financial Literacy blog is a small platform now, I feel like I’m spreading an important message here while sharing practical and valuable contents.

Recently, @MelindaGates and her supporters have been doing lots of work and running campaigns empowering more women and girls to become technology innovators. I absolutely believe in and support this cause. In the same spirit, in this post I am sharing why I believe empowering and supporting women to be financially independent is good for the world, too. Knowing what I know now about the freedom and sense of fulfillment that comes with being financially independent, I have this vision of my own–that our world would be a much better and sustainable place to live in when (1) we aren’t constantly worried about money and we can take care of ourselves and follow our hearts and passions while making a contribution in the world; (2) we are able to build meaningful relationships with those we truly love and care about and (3) we are thinking about our planet as we align our behaviors with our core values.

Recommended reading: Your Money or Your Life and Money, A Love Story

#1) Focusing on Personal Growth and Your Contributions in the World

As women across the globe join high ranking/high paying job sectors, we need the tools and skills to help us become financially secure and stay self-reliant. Having a high income is not the whole story to a woman’s financial independence (FI), but supporting a woman to have a FI mindset and live her life according to FI principles and values is a step closer.

The first step in the process is becoming aware of what lies ahead once FI is achieved, which is freedom and self-satisfaction. The process also requires us to reexamine our values and identify what makes us feel fulfilled. If staying in the “rat race” is not a priority, then we need to come up with an exit plan in order to pursue what truly matters to us. That is, view the high ranking/high paying job as a means to FI (having high income certainly helps speed up the process), but always keep in mind the end goal. Once one decides that FI is what’s desired, then there is a need to make conscious choices to live life a certain way and be okay with that (e.g., minimizing spending, minimizing waste, having a long-term view of money invested today). From my own experience, working toward financial independence takes discipline and hard work, however, I believe that all the hard work is absolutely worth it. True individual freedom cannot exist without financial security and freedom from all money woes.

Once FI is achieved, we can begin to lead a life without financial constraints, where we can take care of ourselves financially, be free from owing others and free to do as we choose. With FI, we can finally sleep well at night and take care of our health. And we can finally summon back the life and creative energy that our money worries once sucked away from us and begin putting this energy toward pursuing our passions and building our dreams. From hereon, when we choose to do something, it’s because we want to and not because we feel obligated to do so. And when we do something, all the big and small decisions we make will be in accordance with our values and our own terms. In other words, financial freedom allows us to focus on personal growth. We now have the time to work on improving our health, pursue hobbies and learning of our choice, and do meaningful work. Yes, knowing that we no longer owe anybody anything puts us more in control of our lives, and as a result, we feel empowered and become more confident. This sense of empowerment and confidence is not of the same kind that one would derive from having a high status and/or high paying job.

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Investment, Personal Finance, Women and Financial Literacy

Women Can Participate in the Stock Market with Confidence, Too

women participate in the stock market

Polls and surveys consistently showed women tend to worry more about making investment mistakes than our male counterparts do and get bogged down in all the financial jargons and end up completely confused. We’re also more likely to think the stock market is too risky. All this boils down to women’s lack of confidence and lack of knowledge when it comes to investing. In this post, I share a simple strategy that helped me make sense of the stock market. Despite the strategy’s simplified approach, it gave me the motivation and confidence I needed to get into the stock market. I hope you’ll find my story inspiring, and I encourage you to give the stock market a(nother) chance. I also challenge you to rethink some of your misconceptions about men and women. This is especially important when many women believe that men are more knowledgeable when it comes to making investment decisions, more assertive and more risk-tolerant.

When I Shop

For years, I’ve been using the unit price comparison strategy when I shop. This was something my mother taught me when we were still living in China. During my first couple years in the U.S., navigating through the grocery market was overwhelming. However, understanding numbers and being able to do simple arithmetic helped tremendously. I had no problem figuring out how much an item costs per pound, ounce or gram, square foot or meter, etc. As my English vocabulary grew, I found myself comparing unit prices while keeping in mind the ingredients list. It made sense to me that a product has almonds listed as the first ingredient charges a higher price than another product that listed almonds as the third ingredient. Once I mastered this strategy, look-alike products (and of various sizes) on rows and rows of shelves no longer intimidate me.

Women as Shoppers

As a gender, women are being praised for being good shoppers. And for many of us, we know that’s true and we own this identity. We instinctively know that $3 off a $6 sandwich is a great deal. When the math gets a little complicated, we use the trusty calculator on our phones for assistance. The calculator also makes doing price comparisons easy when unit prices aren’t readily displayed. In general, it’s safe to say that we, women, carry an air of confidence with us while shopping for groceries, household items, clothing or services. So, why do so many women feel intimidated when it comes to shopping in the stock market? Buying stocks is just another form of purchase, right?

Making Sense of the Stock Market

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