“Just don’t spend more than you make.”
For many years, that was my mantra. I am, by nature, a saver. Or rather, I don’t take great pleasure in spending money.
When it was just me, it was easy to save money. But as a wife and a mother of three? Money seems to disappear without much fanfare.
I know this intimately because I’ve appointed myself the household chief financial officer (CFO). I analyze data (our income, expenses, and investments), develop our budget, and created a financial plan for both short and long-term financial goals.
Ideally, this role would be shared by both partners in a household. But let’s be honest. In reality, it’s one spouse that tends to take over (that would be me).
Or, very often, neither spouse takes on this role. They may choose to wing it or outsource it to a financial advisor. Both of these options rely on an awful lot of luck that you’ve chosen the right path or that you’ve chosen the right advisor.
Do you want to take the role of household CFO for your family? It doesn’t mean simply keeping a budget. There is more to managing your finances than making sure you don’t run out at the end of the month.
So today, I want to share how I became our CFO and strategies to rock your new role.
Table of Contents
My Unexpected Path
My path to becoming a full-time stay-at-home mom caught me by surprise. I had practiced as a veterinarian prior to having children. And the transition from working to staying home was more difficult than I had anticipated.
For instance, I was someone who took great pride in earning an income and being able to support myself financially prior to marriage. At first, it was unsettling to know that I was now completely dependent on my husband’s income. It wasn’t how I pictured my financial life while attending veterinary school.
But, I adjusted. Today, I have absolutely no regrets about my decision to stay home.
For me, part of getting comfortable was stepping into the role of household CFO. To me, it became imperative to learn more about personal finance. Because no one cares more about our money than we do.
Here are some money lessons I’ve learned on my path to becoming the CFO of a single-income household.
Finding Your CFO Mindset
If you’re new to getting involved in your family’s finances or want to take on a bigger role, you may have to change your money mindset around some things. Maybe you need to start believing you can be good with money. Or that women really can take the reins with family financial planning.
You need to recognize your power.
Recognizing The Sacrifices Made By You & Your Spouse
My husband carries the sole burden of providing for us financially. I have never been in a role where others are completely dependent on my income, but I can only imagine the sense of stress and responsibility that comes with this role.
Both of us have made big sacrifices for his career. Thus, I don’t take his paychecks lightly.
I loathe the idea of wasting money in general, and mismanaging our own personal finances would be a prime way to potentially waste much of this hard-earned income. This has become a big reason why we’re on the path to financial independence.
Related: What Is FI/RE? The Basics of Financial Independence
Creating a Plan for the Unexpected
As the primary caregiver, I am constantly thinking of ways to make my days go as smoothly as possible. And being a mother to three children, I’ve also seen my fair share of times when you just need to throw your plans out the window. Toddlers are a constant reminder for the need to make room for the unexpected.
This is especially true for our finances, where I’ve had to make sure that we account for the unexpected.
There are various reasons why my husband might not be able to work in the future. And that would clearly leave us and our children in a difficult spot.
We’ve taken steps to mitigate these risks by purchasing appropriate term life, disability, and umbrella insurance for a complete financial disaster plan. (Before I learned more about insurance, we definitely had sub-par policies. We’ve now switched over to much better coverage. Make sure you have enough insurance to protect your family.)
I will gladly pay the premiums for insurance and take the time to fill out a family emergency binder with hopes of never needing them. But if the unexpected happens, we will be prepared.
Getting Empowered
Discovering where you stand with money and learning to control it versus letting your money control you is an incredibly empowering feeling.
As we went from newlyweds to becoming parents, it was disconcerting to see how money seemed to just disappear, never to be seen again. Not only were there the mortgage payments, car payments, retirement savings, and the student loans to pay off. Now we had to think about moving to a bigger house (bigger mortgage!), saving for college, paying for preschool, making room in our budget for extracurricular activities, and more.
They aren’t kidding when they say that kids are expensive!
Defining your goals for your money and then implementing a plan so that you can use your hard-earned income in an intentional way allows you to feel more in control. Don’t watch your bank account dwindle without understanding why. Instead, you can create a financial plan that puts you in the driver’s seat.
Unfortunately, there are still gender gaps in income and wealth. But that makes it even more empowering as a mom to have intelligent conversations with people in the financial industry. (Especially when it’s a man who starts the conversation assuming you’re not involved. Hehe.)
Want a supportive, safe, and fun place to talk about money with other moms? Join us in the Smart Money Mamas Community today!
Know You Can Impact Your Family Finances
I’ve had many conversations with fellow stay-at-home mom friends about personal finance. Most of them immediately say that they rely on their husbands and/or a financial advisor to manage their investments. They might help keep the budget, but longer-term planning? They were out of the loop.
I made the simple mistake of relying on my husband with our investments in the past. Yet, what I’ve realized is that there is always room for improvement. There is no such thing as a perfect plan, but you can certainly strive for a better plan.
And as a stay-at-home mom, you’re probably closer to the day-to-day finances than anyone else in the family. You know how much the kids’ activities cost, how much you spend on food, and how much that credit card debt is costing you. You’re on the front lines, which means you can design and implement the changes you need to make to put your family on track for your goals.
Becoming Your Family’s CFO
Before you start slashing your family’s budget or starting an investment account, find some financial goals that light you up. Ideas that get you excited about thinking about money.
Because being smart with money isn’t about money. It’s about all the things you can do when you make your money work for you.
What would your life look like without debt? Or if you could drop from full-time work to part-time? Or if you could pay for your kids’ education without any worries?
Would you and your partner pursue new passions or hobbies? Argue less? Stress less?
Find your why. And then get to work.
How's Your Money Health?
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Who manages the finances in your house? How can you get more involved? Share your family’s experiences in the comments!
This is a guest post from Grace at Financial Wellness DVM, a personal finance blog for veterinarians. Grace is a veterinarian turned stay-at-home mom of three awesome children. She and her husband are on the path to financial independence and Grace is passionate about helping veterinarians take control of their finances.
