Season 4, Episode 13: Financial Division of Labor in a Partnership
What’s the Bare Minimum the Non-Money-Person Has to Know?
Most of this episode is about what both partners should know - or at least be able to know - in a romantic partnership where one person does all the money stuff. Sara even does a “the four numbers every non-money partner should know” clickbait thing. It’s good stuff. And helpful, and useful and food for thought.
But the REAL subject of this episode is how Sara deals with laundry in her household. Caitlin will never not be shocked and awed by this and needs to talk to as many people as possible about the arrangement as soon as possible. So please listen immediately.
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This episode was edited by our co-producer Kelly West. Music by Bad Bad Hats and Devmo.
Transcripts for Season 4, Episode 13: Financial Division of Labor in a Partnership
Caitlin [00:00:03] Welcome to Women on the Verge of a Financial Breakthrough, where we're figuring out finance one dumb question at a time. I'm Caitlin Meredith, a mediator and coach based in New York. In the Bay Area.
Sara [00:00:18] I'm Sara Glakas, investor, advisor, and founder of BlackBarn Financial, and the Austin Women's Investing Group, which you can find on Meetup.
Caitlin [00:00:26] Can you think of a woman who could use a little money motivation and send her this episode? And please, if you can, leave us a review. They help more women find the show and make us feel like a million dollars. Pretext.
Caitlin [00:00:43] Oh, oh, oh
Caitlin [00:00:48] Sara, when we were testing out our recording equipment five years ago to start this podcast, one of the conversations we had was what do you do if you're in a partnership and the other person is in charge of the money stuff and you're not, and you gave all this brilliant advice about what to do if you are the person who is the non-financy person, how much you need to know to not repeat all the work. And then we couldn't use it because it was such shitty quality sound quality.
Sara [00:01:23] That sounds totally accurate. That definitely happened.
Caitlin [00:01:28] The good news is I don't remember anything you said. I don't Me neither. So we can have this conversation afresh and like really profesh with reasonable sound quality. So this must come up in your work. A couple partners come to you and say like, well, he does all the money stuff, she does all money stuff. Either I don't wanna know anything about it or what do I do? And I'm sure you also see where there's a divorce or someone loses their spouse and they all of a sudden have to figure that out real quick. So what is the advice you give to people who aren't the money person in their partnership?
Sara [00:02:10] Oh my gosh, that is a big question. I feel like that. Ready, go. Really the first thing that everyone needs to know is that much of what we're talking about, the financial information, the dollar amounts, like these are things that are knowable by really anyone, there's nothing that is beyond anyone's grasp, beyond anyone realm of knowledge, like at a very basic level. Like the information that everyone should have is a basic accounting of how much you make, how much your household makes. So money in, how much spend, or how much household spends, just money out. Those are arithmetic, right? The third thing is the total value of your assets. Assets are things that people own that you expect to increase in value over time. So you don't even need to know.
Caitlin [00:03:25] That's the inherent meaning of an asset is something you own that is expected to increase in value over time
Sara [00:03:33] Yeah, you can split hairs with what an asset is. You can call a portfolio of stocks. You expect stocks to go up over time. So those are appreciating assets. You could theoretically put the value of your car as an asset. It's worth something, right? You could turn it into dollars if you sold it. But that's usually what we call a depreciating asset. It goes down in value over time but think of just the things that you own that are worth something if you had to sell them.
Caitlin [00:04:07] Okay, worth something, I'm with you, asset, but that's interesting. I've never attached it to the idea that with the expectation that they will grow over time.
Sara [00:04:17] Right. When I think about assets and when I do it in the office, I don't write down the value of people's household furnishings. I don t write down that value of people's cars, their computers, your cell phone, because all of these things are converging towards zero over some period of time, right? Whereas your stocks, your bonds, even your cash, right, you expect it to hold its What about a Pottery Barn Couch? Not a pottery barn couch, unless this is a collectible that you are not sitting on, and it's in the Sotheby's catalog, it is not an asset. It is going to converge to zero over some period of time and get used up. So the value of the assets for most normal people, this is bank accounts, retirement accounts, investment accounts, your house, maybe some other, but those are the four basic categories. So, and here again, like I'm just talking about Like. You and or your partner should be able to write down the value of those things. Just make a very simple list of this is what it is, generally speaking, and this is the value is today. So those are your assets. And then same thing, the balance of your liabilities. Liabilities is a fancy word for debts. So how much do we owe on these assets? So we have. A mortgage, we owe this much. We have a credit card, we own this much, we have a car loan, student loan, whatever it is. You should be able to go to all of the accounts and write down the balance. And now you have these four incredibly important pieces of information. How much do we earn? Yeah. How much to we spend? What's the value of our assets? And what's the balance of our debt? And if you have those things, you have probably 90% of the information you need. To be making decisions going forward.
Caitlin [00:06:15] And attached to each of those things is so obvious, but I'm gonna name it, the names of the institutions where the savings accounts are, where the retirement accounts are where the loans are from, the passwords, the login information, all of that stuff.
Sara [00:06:31] Right, I put all of that, what you just listed, as the remaining 10%, the drudge work of what type of account, whose name is it in, what institution is it with, what are the holdings inside the account, who are the beneficiaries, what's the login information for this account, who do I contact? All of that stuff is kind of the remaining 10%, which is an important 10%. You don't wanna give up making progress on the most important part of it, which I think is the first part that I described, because you're afraid of the last part. All of these details that you can just get mired in.
Caitlin [00:07:16] You know, it occurs to me we always, at the end of each show, we have this public service announcement about financial abuse and the many ways that that can show up. And it occurs me that in going through this kind of like yearly audit, that's my next question for you, how often people should do this. It's also important information you should have about like the state of the financial union and that it could be a time where you find out about debt you didn't know about. Like even if it isn't because someone has died or there's a divorce or any of that, that some underlying understanding could be increased there about what you're both facing.
Sara [00:08:01] Yeah, absolutely. I mean, if you are in a partnership that is not your word, no one is experiencing or inflicting financial abuse. It's so it's like a pretty functional relationship. Just imagine how having a snapshot of income versus expenses, how much information that gives you. Yeah, if you look at that snapshot and you say like, oh shit, my expenses exceed my income, the next question should be something like, well, like How are we still here, right? The money is coming from somewhere, right. And so if your expenses exceed your income, you are accumulating debt, right, like just by default, unless you have another source of money, family, something like that that's covering the shortfall. But for most of us, the way that manifests is you will see your liabilities number going up. And so just, again, like these four pieces of information are so critical because they all relate to each other without needing to get into the nitty-gritty of I don't know what a stock is. Like we're at just like this level where you don't need to know what stock is, you need to these four piece of information and you can keep that piece for later. But these are also four pieces of information that when people come into my office and like in wealth management. My clients coming in are what most people would consider to be like relatively sophisticated financially and very few people know all four of these components when they come into the office so it is like it's it's difficult to get a handle on it's easy to ignore all of those pieces you can just go about your life not knowing one of the four not knowing four of the and yours going about your life. But if you want to get a handle on where you are, you need to know those four pieces of information.
Caitlin [00:10:02] So you know how people that post on social media when their kid enters a new grade and they have those little chalkboards where it's like entering the sixth grade, eight years or whatever, 11 years old, favorite color, wants to be whatever, we can go on Etsy and create those little things for people to come in like these are the big four of our financial union and they have to like post not on social media but between each other. Come to their financial advisor. Here are our big four.
Sara [00:10:31] Yes, here's our big four. I love that idea. We can definitely make we can make millions on this idea.
Caitlin [00:10:38] We have so many get rich quick steam
Sara [00:10:42] Trademark, trademark.
Caitlin [00:10:45] We thought it first was like puffy paint. I got it. I have a whole vision. Okay. So they don't know it. And as we talk about like so many times it's boring is we don't often want to know that. Like we think we kind of want to know it, but when it comes down to it, what if the answers aren't the ones that are going to make it easy to sleep at night? And I think that's, there's a reason we're afraid of knowing it and what we keep sort of pushing on this podcast is like information is power. Knowing it allows you to consider your options. It doesn't mean a dead end. And especially in terms of partnership, and if kiddos are involved, I see in my work how there's so much friction around spending. And often, one person is much closer to the knowledge about what income is coming in and what is going out. And it kind of shows up as a relationship issue, or it shows up like, I grew up very frugally, and I grew and his family spent everything. But that a lot of it is also tethered in the reality of the financial state of the union. And without these conversations and that knowledge, it can kind of like seem like personality issues instead of like real math.
Sara [00:12:08] Yeah, yeah. I mean, I definitely think that, I mean when you are discussing these issues with your partner or with your family members, I mean, it's fraught with peril, right? There's no, like, there's no way around, like how defensive or angry or like how like the reactions that people are going to have. Like there's, I don't know. I don't think there's any way around this. I think there is, you know, like we all read stories on how like how to have these difficult conversations. I mean, you specialize in difficult conversations, right? And maybe like having more skill around having the conversations, but certainly like, you know, speaking as like a middle-aged. Woman who's been in a long-term relationship with this guy and got these kids when we're at this life stage like these conversations are fraught with peril and that's okay it doesn't mean you shouldn't have them yeah right it because it's in a partnership it's important that everyone has a basic idea of the lay of the land And so that everybody is able to take responsibility for the spending decisions or the earning decisions or the investing decisions or that debt pay down decisions. Like even at a very high level, that everyone is accountable for what the household is doing. And as soon as you stop having the conversations or if you don't ever start having the conversation, I mean, this process is just gonna roll on. In whatever direction it's going, if no one is going to step in to stop it. And so that really does not typically lead to favorable financial outcomes, if you're not having these conversations in a partnership.
Caitlin [00:14:03] And I think as you mentioned, even in like really healthy, like in healthy partnerships, this just might've evolved over time. You start with nothing and then people get better jobs and one person is like steps up and it'll be like, I'll be the person that handles all, you know, I will be the one that figures out the bills or you do these things and I'll do that. And that there might not be an external reason for, you know if there's a lot of us. And yet, that's when the unexpected thing happening can really thrust someone into the driver's seat and they need to have those tools. So that makes me wonder, how often are partners supposed to have this conversation?
Sara [00:14:44] I mean, I think at the very least, it needs to happen once a year to have some sort of financial summit where you're at least talking about the basics. And I will just confess here in front of all of our dozens of listeners that have probably not had a financial, I am the financial point person in my own relationship and I have not had a financial summit with my spouse. It may be like six, seven, eight years.
Caitlin [00:15:20] Let's get Christian on the horn. Let's him here on the Zoom. We're going to do it right now. Listeners, help me out here.
Sara [00:15:27] But the way we talk about it at home is very much like leaning into the roles that we've assumed. I lean into my role as the financial caretaker. He leans into his role as not interested. Not interested and completely trusting. Yeah. Right. And so I hear like, OK, not interested and completely trusting, which like a little voice in the back of my head is like, oh my gosh. This is a lot of pressure. He trusts you so much that you have carte blanche. The power. The power and opportunity to just take this thing off the rails or to just really go in whatever direction. Yeah, I want this to go into. And every single time he says that is like, No, I, I trust you, you've got this, I think, Oh, my gosh, we need to have this financial summit. So we talk about it all the time, like, hey, let's carve out time to have this financial Summit, and it just never really comes to pass. And, you know, I tell him, like I, like like, everything is okay, like we can afford to do this project, we can afford to get this water softener, whatever project we're looking at. And he's like, Okay, Like, I trust you, I'm gonna like, is this a yes? Are we a go? Are we, you know, so we have, we do have some way of touching base about it, but like my little income expenses, assets, debts, I know all of those numbers and he does not. So if something happened to me, I mean, honestly, like the next step is like, he needs to get in touch with our financial advisor, who's my partner, Casey, she knows everything about me, right? And then he's just going to have to like fall on the mercy of like whoever is going to help him get into all of the accounts.
Caitlin [00:17:21] Isn't it the cobbler's kids don't have shoes or something like that?
Sara [00:17:23] Right, right. You know, and so I think in my head, like, okay, how can I mitigate this risk? And this is where I think about like, where people can mitigate their own risk, like I'm, I'm viewing it from a perspective of, oh, my gosh, like I have all this power and it's it's too much like I need to make sure that I'm you know, like really going above and beyond in my duty to this person who trusts me completely. No matter how the marriage turns out or how like whether I get hit by a bus like in these kids and oh my gosh And so I think I was think like worst case scenario, right? Like, do he and I both have access to money independent of the other person? And the answer there is yes. Like we have a joint account with money in it. We each have credit cards in our own name. We each retirement accounts in our name that are roughly equal, right. Even though like we've had different like earnings levels over the years, like roughly equal in our names. I know that he has family members he could call on in emergency. I know I have adequate life insurance on my own life. I know there's adequate life on his life so that we are protected in a worst-case scenario and that our children are protected. We have gone through an estate planning process, though not in the recent past, but estate planning documents do exist.
Caitlin [00:18:43] Okay, we are somewhere we've already dropped an episode where you admit you haven't filled out the paperwork. Yeah.
Sara [00:18:50] There's some stuff there that from some number of years ago. So that still hasn't changed whenever we recorded that episode still have it.
Caitlin [00:18:58] This is turning into an intervention.
Sara [00:19:00] I know. I mean, but it's I think my point is that it's not perfect. Yeah. And certainly, like, my spouse does not have perfect clarity in here, nor does he desire it. But the steps are in place that even though it'll be a total pain if something happens, or if we have to, I don't know, like, you know, things fall apart, and we have to separate everything that information exists. Somewhere. What we need to do a better job about is making that completely equally accessible to each other. Or not to each other, I know everything. He knows nothing. Making it perfectly accessible to to him. And that that will also, like I think this is the benefit to myself, it will make me feel better when we get there, right?
Caitlin [00:19:50] I so appreciate it that you're bringing it up in these terms, because I'm sure you're not the only person whose partner is actively disinterested in being involved for whatever reason. And so it's not, it's like very sort of utopian to be like, and everybody will have a summit and twice a year they'll sit in a meadow and run the numbers. That just might not be a possibility. So if you are the financial caretaker for the partnership. What are the things that you can do to safeguard your partner? And so I think it's really helpful to think, OK, joint checking, but having their own credit card. Do they have access to emergency money? What does their financial safety net look like if I start buying designer shoes in secret and then rent a storage space and fill it with $1,000 of shoes that turns into some other balloons into some. Like gutting of your own retirement account, that that's an internal safe, a real one, an internal one to know that there's only so much I could mess up that would like bring us both down. So I think that's really helpful. That's generous of you.
Sara [00:21:09] Thank you. As I'm saying it, I mean, I'm also thinking of, you know, like the whole thing, like if he wanted to, he would, or if she wanted to she would. The way that, like, I hope that the way I'm talking about this is, like I feel an incredible responsibility towards my partner, no matter what, right, that this financial life we share needs to be fair and equitable, and it's not perfect. But like on the flip side, if you're kind of listening to this and you're like, I do not get this sense from my spouse at all.
Caitlin [00:21:43] Yeah, right.
Sara [00:21:45] There is like, there's a red flag element to it too, like the hoarding of information. I mean, we all know this is like this is a red flags. There's, there is no reason that one person should have disproportionate levels of access or disproportionate knowledge about money, if the other person in the partnership wants that information.
Caitlin [00:22:12] Yes, such a good point. Like, if Christian was asking, or if my friend was asking their partner, like, hey, can we sit down? And there's pushback to that. That is, I think, like a real opportunity to see what's going on there. Not only are you legally entitled to all of that information, if you think of marriage, especially if it's a legal marriage, but if you're living together. It's like a business enterprise and can you imagine two business partners and one's like can I see the books and the other's like
Sara [00:22:48] Exactly, exactly. There is no good reason. There's not a single good reason, I mean, can you think of one? Right where...
Caitlin [00:22:55] And maybe that it's so much more than the other person knows, but even then, then they're having stress and anxiety. I've actually known of that in a marriage where one person came in with quite a bit more than the other. Yeah. And I think in the beginning of the relationship, it was sort of this tension where they didn't want to exacerbate it. So like, I don't know how many millions he has. I don't I don't want to know because I don t want to make choices in a way that are based on money. But then once you're married and have kids, that isn't, you need to know. You need to what each person is kind of looking at and if there is such a big differential.
Sara [00:23:34] Or at the very least, you need to know that if you asked or wanted to know more, you would get that information immediately. Right. And that's kind of that's kind of the piece. I do think that everyone should have this information. Right? It just is going to make you a better decision maker, like in all aspects of your financial life. But certainly there's there's no good reason for secrecy. There's like not a single one that I can think of, I think even in that case, like it sounds maybe it was driven by a person not wanting to know so that they don't change their lifestyle in such a way they can't come back from it or whatever it is but if I am asking my spouse for information my spouse should give it to me like without there's no reason not to.
Caitlin [00:24:20] So Christian, if you're listening, you need to ask Sara. She's making an Etsy board for you to fill out.
Sara [00:24:28] I am gonna make an Etsy board. I mean I have like all of these like little notes like in my it's like so that at a moment's notice if he becomes interested that we can like sit down that's what I mean. Maybe this is my problem because I always tell him I'm like we could sit down right now and I'll show you I'll, show you my numbers like we're fine and I can prove it like right now. And he's always like uh
Caitlin [00:24:48] You're coming off a little strong here.
Sara [00:24:50] Right, yeah. She doth protest too much, right? Like, I got the numbers right here.
Caitlin [00:24:56] I love this. So the message for the person who's the financial caretaker is invite, always agree to share, and suggest if the person at least a yearly sit down to be like, hey, I really would like you to have this. Let's figure out a system where you are comfortable with the access to this information, obviously the passwords and whatever that looks like. And if you're not... Kind of think through why you're not and what it would look like for you to say, can we just start with a short conversation where we're gonna deal with the income first and then the expenses and sort of build up to this larger picture. And you're getting information not only about the finances, but also, is there any hesitance? And you should know why, what that's about. It might have nothing to do with the money. It could be some other relationship thing, but those all seem important to know about.
Sara [00:25:58] I mean, I'm curious, like, from your side, Kaitlyn, like, do you think that do people need to know all of the details, even if they are an uninterested party? Like, how deep do you that someone needs to go?
Caitlin [00:26:15] I find this fascinating because I, of course, am a full-time solo parent, so like there's... My financials are my own. I don't know that I could tell you... I could not tell you my top four, right? I don't have the stickies like you do, so in some ways you're more prepared to have that conversation. For me, I should know all that, and I just have a sort of like, I'm sure it's fine feeling. Yeah. But so the idea of someone else asking me for mine and be like, are you it's just none of, not it's none of your business, but like why, so I have a different response to it, but where I, my energy gets kind of activated is when I think about the people, especially women, but also men who are facing a divorce that were blindsided by it. And what I see is that often, but not always the person who was the money person, has a much more secure route to say, I want a divorce. And to execute that plan, often, not always blindsiding, the partner who's not the money person. And because of that, I wanna protect every single person I know, happily coupled or not, to be like, you need a partner like Sara who's thinking about what credit cards do you have access to, what? So if the shit hits the fan whatever that looks like that you don't feel like a total idiot a and B that you actually have resources and have paths to get those when you're gonna be already and quite a lot of stress and emotional turmoil and parenting perhaps That's where my motivation really comes is thinking about the people I do know that have been blindsided for whatever reason and then and that people who announce a divorce are people that can imagine a financial pathway to move out. If you don't have control over the money, you don't even know what that would look like to do that.
Sara [00:28:29] I mean, I think that's such a good point. I'm going to, like, as a financial advisor, I can see that occasionally when couples come in to hire me, it's almost as, like it's a neutral third party. Like, certainly there's the amazing expertise, right? But there's also, I, think, an element of just a third party who has eyes on what's happening. And also, you know, being. In business and in the stage of life where marriages fall apart and you end up dividing assets it seems to me watching uh you know of my own clients who who are going through the process it seems To me that there must be comfort on both sides for someone to know again like what is what are all of those four numbers what's the income what are the expenses What are the assets, what are the liabilities? There's a third party who has the ledger. Each person who's now going through this horrible experience has someone to call. So they can each call me. I tell them, I'm like, listen, I'm not going to hide any information, and I'm going to tell you what the other person is saying. I'm here to provide information to you and your attorneys and to help you through this in the most constructive way possible, as long as we're all in agreement about that, then. Visibility on all sides. Whereas in a situation where there isn't a third party, or the third party is very much aligned with one of the spouses, like to the exclusion of the other spouse, you don't have that same resource already put in place. Like, oh, like, who is the person I can call? My attorney's asking me all these questions. I have someone I trust who knows the answers. Already in place. So it's a little bit of a commercial for hiring a financial advisor, right? But it's also kind of treating financial advisor as should be neutral third party, right, like.
Caitlin [00:30:42] Because the finance caretaker becomes the gatekeeper to all this information that you desperately need A, to even like go through the divorce proceedings and produce what you need to produce to make it go forward, but also to know like, what rent can I afford? Like, how do I get a new place?
Sara [00:31:01] Right and coming out the other side of this it is just numbers it's like okay these numbers if we put them in this formula this is what you can afford this is what your new retirement plan looks like this is like all of these decisions going forward if we take the original plan. Right. And start over with half of whatever it is, half of the assets, half of the debts, like someone has a certain amount of income. You have a certain number of expenses, but you restart the financial planning process and you can do that while you're still in it to get an idea and a sense of, you know, am I going to be okay? And I've had several clients who they don't come out the other side in a better financial position. That does not happen. There should be no expectation. It's not better. I mean, there's a pretty high percentage of them who are like, oh, I'm better off than I thought that I was going to be, right? I mean it must be comforting to be able to have that information. And so looping in an advisor helps with that information disparity and can be really helpful. Because certainly the divorce scenario that you described is like the worst case scenario, where it's blindsided. You have no information. And you're going into. This catastrophic event with no frame of reference, with not knowing how it's going to end, how you should be negotiating, what you should be negotiating for. And certainly, that's what attorneys are for, right? And they'll help you through that. But.
Caitlin [00:32:38] But I have clients who don't even know what the ask could be, because they don't know. Especially people that are part of family businesses or others, where it just hasn't been very transparent. And then you get into hiring forensic. I mean, this is also doomsday. It actually started from the idea of, what should healthy relationships know? But I think. As you say, at this age of life where we've kind of are starting to see a lot of different things that we would not have predicted and had like this many more clients and the life stages that they're at and the surprising life events that we have, like you can't, It doesn't ever feel like the wrong idea to know more about your financial situation. Which doesn't mean, oh, I'm the person who's now gonna have to take it over. Every time they're gonna do a financial interaction, I have to be sitting next to them and logged in and watching it. Like, you don't have to any more involved than you are now, but understanding it and speaking a little bit of the language, income, at least if I can understand it, you can understand that. But wait, this made me think when I was thinking about talking to you about this, I was like, okay, financial division of labor just division of labor in general. And I was shocked by a memory I had of something you had said. This is a test if my memory was right, if you're the person. Are you my friend that pays someone that puts a price on a load of laundry? Oh yeah, that's me, yeah. Listeners, just brace yourself. This is gonna be new and shocking information. I think we come out liking it in the end, but I can't remember. So Sara You don't wanna do the laundry, it's not worth your time.
Sara [00:34:31] No, no, I hate it. It's not a judgment as to whether it's worth my time or what my hourly rate is or anything. I just hate it more than anything in the universe.
Caitlin [00:34:43] So you as the breadwinner of the household and a mom of two daughters and a household of four people have decided that I'm going to put a price on who's going to do what a load of laundry is worth in my household. So how does that play out? Yeah, it's more like a bounty.
Sara [00:35:03] Um, but it's like, so the, the, this is shocking. Like it's, I'm not even embarrassed about it anymore. I tell people, cause I think it's actually.
Caitlin [00:35:11] I'll tell you why I love it after I shame you.
Sara [00:35:16] So the going rate to do a load of laundry start to finish in the Glacus household, our economy of four people, is $25 per load of laundry. You have to start it, you have to load the washer, to wash the clothes, you have to dry the clothes. You have fold the clothes you have put them away. So that entire process, $25 for whoever, all takers.
Caitlin [00:35:38] So like even people outside of the family when I'm in Austin next time.
Sara [00:35:41] I mean people have offered no one's actually come over to take me up on it, but
Caitlin [00:35:47] So how does that work in the household? Is there like a signup sheet in the laundry room? How are you made aware of it?
Sara [00:35:55] So I'm trying like where this all came from is trying to teach the girls like a how to earn money and also how prices are set in the larger economy, right? Like the the price of a house is whatever someone will pay you for it, right. There has to be a meeting of the minds. And so and also this like this bounty on the laundry is in addition to normal chores that they have to do. Right. So this is not. But in thinking through this, that if they want to earn money, that this is a way for them to relatively quickly, and with quite a bit of effort that no one wants to put in, which is what a job is, right, earn money to do things that they might want or need to do. And it's funny, that price is shocking to most people. The laundry in our house still does not get done. So I will just point out, it is not high enough. You would think that people would be clamoring all over themselves to do this load. I won't do it to save $25. Every once in a while, I will. And Christian, who thinks this is outrageous, will do preemptive strikes, and he'll do the laundry to keep the money out of the girl's pockets. He doesn't want them to think that $25 per load is acceptable. So he and I differ on this. But I think it's, I mean, I think that when the girls ask for something, I also do not, I don't buy them very much like discretionary stuff. So when they want something special, when they, you know, want whatever it is, whatever kids want, right? They have to save up the money in order to do it. Like we don't have a lot of extra discretionary money that is spent by me on the kids. And this is the exchange. This is like, okay, if you want special stuff, you can earn the money and you can pay for it. And this is a way for you to, you know, relatively quickly, like in the comfort of our own home, be able to earn a living in order to get the things you want. And watching them make that calculation, like what's worth it and what's not worth it is kind of fascinating to watch.
Caitlin [00:38:05] Okay, and before I shame you and then tell you why I love it, I want to find out logistically how do they get their money? Do you have a bunch of 20s? Like for me paying my kid, I'm like, oh my God, I have to go to the bank, whatever. Like how are you paying them?
Sara [00:38:22] Yeah, so both of the girls have a green light card. And so there's, it's just a transfer from me to them. And it's never, like, Caitlin, you were telling a story the other day about how Seralina told you that.
Caitlin [00:38:35] Oh, she owed her.
Sara [00:38:36] Her all of this money, right? Like, like, they'll do that too. Like, I'm supposed to put $45 in Sasha's green light. I haven't done it yet, right. And so she'll have to ask me.
Caitlin [00:38:48] Do it. But that is the mechanism. That's realistic too. As a freelancer, that's super realistic.
Sara [00:38:53] Right. The mechanism is we're in a non-cash economy by and large, and so it goes directly from my checking account to their green light card, and then they can choose if it goes into the category, or sorry, the spending category, the savings category. And in the case of my older daughter, she is saving up for a trip to Washington D.C. Something like $2,100 she has to raise, right? So she has developed a budget she's supposed to be meeting or like a goal amount each month she's supposed to be meeting to stay on track. And if she doesn't meet it, then instead of her getting an allowance, she will pay me back until the debt is repaid. And so she knows all of this. And so, she's able to make these decisions on her own. Certainly, I harangue her and harass her, and I'm always nagging her about it. But by and large, the decisions are her own on how to earn money, how to spend money, and how to make this all happen.
Caitlin [00:39:50] It's a lot of loads of laundry.
Sara [00:39:51] It is a lot of loads of laundry.
Caitlin [00:39:55] The shame is that I can never let my own daughter listen to this episode because she has been doing her own laundry since kindergarten and I never want her to associate it with like she would be a thousand errors. I know so this is you must never tell my own daughters.
Sara [00:40:15] This is to be clear, this is family laundry, not their own laundry, which they are largely responsible for. This is the additional laundry in a four-person household that just builds up into these giant piles.
Caitlin [00:40:29] Okay, good clarification. Okay, she just does her own laundry. Okay. But here's what I love, even though I find it complicated, the idea of like, basically I don't wanna pay my own kid $25 to do a load of laundry, so that's my pushback. But, and I have the idea that kids should do chores because they're household members and look how much we do and that's just part of like the cooperative that we have here going. What I love about it is that I think for many women, the idea the outsourcing things that we could do ourselves. Is like anti-woman or like that we don't value our time, our labor doesn't count and that when we're thinking about our weekend I know people that like a full day is given towards you know if it's not cleaning it's meal planning kill me now doing all of this stuff that's baked in and if you're saying my weekend is for pleasure and for doing things that are meaningful to me or mean nothing to me, but I enjoy them anyway, whatever, and that the price I'm gonna put on that is $25 per load of laundry, I find that revolutionary and that teaches your daughters also that like choosing not to do this labor is 100% okay. That if you have the resources to do it and you're making choices like that, then.
Sara [00:42:01] Thank you. I appreciate that, because that is like, it really is part of like a larger discussion that I always want to be having in the household and with the girls specifically about money, right? And so like I've had these conversations with people before, like if your child lends you money, how much interest should you pay them? Or something, or like what is the allowance amount? Yeah, and I and I find that the larger the amounts, the more interesting the discussions. That if we're using market rates on interest, like if you lend me $50, I'll pay you 4%, right? Like, it's not incredibly interesting to a child. Like, how do you pique someone's imagination? Or Sara. Right. Or an adult, right? Because I think the conversations I've had with other moms about this crazy idea about the laundry have been really, really constructive, right? And so. I'm not here to say that this is the right price on a load of laundry, or it's the right way of doing things. But I do know that talking about it and just sharing the experience with other people in my community has led to more discussions around money, which I think is always valuable. So I'm trying to balance it. I know to some extent that it's ridiculous, right? And that it kind of like how you find like the parents who like or the kids who get like 20 bucks for a lost tooth. And you're like, God damn it.
Caitlin [00:43:32] Corridor
Sara [00:43:33] I thought we all agreed on one course. Who is setting the market rates for a tooth, right, and in the economy? Or like, you know, people like super extravagant Christmas gifts or birthday gifts or whatever they are, right? So we are having these conversations no matter what, because this is the world that we're living in, where there's.
Caitlin [00:43:52] Yeah, we're all exposed to everybody else's practice and there's comparison.
Sara [00:43:56] Right, right. So I find that this is like, I have, I have meaningful conversations with my kids about money and what it means to earn money and what it means to make spending choices. And it's not limited by kind of the small amounts that make those conversations less, less interesting to me and to them.
Caitlin [00:44:18] And it's not, I wanna point out my own black and white thinking about how like chores should be expected because kids remember that. You're saying they have other chores that are expected and you know, they do, I'm sure they're normal kids. I know they're normally kids, I know them. They do them, they don't do them. You nag them, whatever. You have highlighted, the laundry is almost arbitrary in that it is a task, it is job, there's a price on it, it's labor. Happens to be spectacularly well strategically identified because it's something you don't want to do. Right. And so it solves that problem, too. So it's not the only ethics of the household. We're going to use this as a placeholder for conversations about money and for you deciding what your labor is worth to you for what you want. Right.
Sara [00:45:11] Right, there's three chores that have prices attached to them.
Caitlin [00:45:13] Oh, what are the others?
Sara [00:45:15] Loading the dishwasher and unloading the dishwasher. So one of them, now I can't remember which one is which, I hate unloading the dishwasher, but I don't mind loading the dishwasher. So the prices are different on loading and unload. I think unloading the dishwasher is higher because I don t want to do it and loading the dishwasher is lower or vice versa. Now I can't remember. But those are the only three chores. And every time the chores come up, there is a conversation the girls will check with me ahead of time. Am I getting paid for this or not? And so like often it's like, no, this is just like a regular, this is just regular chores. Like you just have to do it because you're part of the family. Um, and then sometimes it's, like, okay, yeah, it's Saturday. You want to be able to go. I mean, my older daughter always wants to go to Sephora, which is just like, you know, like kill me. Like if you want to spend $75 on a face cream, like there is a zero percent chance I will participate in that. So there's three loads of laundry. Is that an exchange rate you are comfortable with? That's the exchange rate. And that way, I don't have to be like, do I have to spend $75 on face cream for a 13-year-old?
Caitlin [00:46:22] I love this clarity because I feel like I am inadvertently plunging my own daughter on this ambivalence about money that I'm like oh god no I you know first I say no and then I feel guilty and then i try to put it in perspective and then I say well maybe it's not clear at all but if there was a system in place where if there was something she really wanted and I made it very easy for her to earn that money then I, I'm off the hook from thinking through what should I feel guilty about? What should I, you know, for this level stuff, not like a trip or something. Well, trip to Washington. I can see how you can contaminate your kid a little bit less from your own ambivalence and competing ideas and what other people are doing by just laying it out very clearly. This is how you earn the money. If you want it, you'll do it. I'm not going to intervene. Having a partner who disagrees with that practice, I feel like we can't even tackle here. But that like, because I was gonna be like, do you pay him? Like, no. It would seem very reductive to be like Christian, what's your Greenland account?
Sara [00:47:38] No, because he's like so anti it that not paying out is his payment, right. It's so it all comes back to like, this is also like a circular economy, like our little four person economy, right? And wanting to have these conversations. And what is the price? What is something worth? Like, how do people get to control their own spending? Is like, it doesn't mean it's a perfect system. It's more like having the conversations, disagreeing about things, and having the conversations is really, really valuable. And I do find my kids have generally, what I perceive as generally healthy money habits, even as children. I have a spender, and I have saver, and we always laugh about how they will need each other forever. They will have to live together forever because my older one will spend. Every cent that she earns. And my younger one has spent, in her entire life, $16 on a pair of cool mom socks that she got me for Mother's Day and never another penny. And so now they have a symbiotic relationship. They need each other, which I also enjoy. Like, OK, all of these choices that you're making lead to something else. And understanding that is important. Because I think that's what we hear about in a lot of these kids and money conversations is the kids don't. They don't get enough money context or conversations to understand the consequence of their actions. So the sooner they understand the consequences of, OK, I'm going to do this laundry, and it sucks. And guess what? Work sucks. It's hard. If you do this hard thing you don't want to do in exchange for money, welcome to life. This is what we do. And that is a really useful thing to learn. And also, you don't get the $25 every time. Sometimes there's just things you need to do because we live in society, right? And so there's work that goes along with living in society. Anyway, I think it's a great way to get to know yourself.
Caitlin [00:49:40] But it's not just money, Sara, it's time. It's you saying, my time is valuable, not in that because when I work, I make this hourly rate. It's that my off time of working time isn't already automatically signed up for all of this other labor.
Sara [00:49:58] Right, right. I mean, and so I will like eventually with the, if I'm just like, I'm not going to do this laundry, I don't want to, I will put it in the bag and I will send it out at a service. I know how much that service costs and other people can watch their dollars go out the door and be given to someone else who is going to the labor of the laundry. And if they want that money instead, they can do the work, right? But for me, it's, it, I, That is just the one thing basically that I just, I don't wanna do and I would rather pay someone else a living wage to do it.
Caitlin [00:50:38] I love this and we've talked about this in depth. I remember being as shocked, but then it was like so shocking that I forgot it because it had no purchase in my mind. And when I was thinking about this episode of division of labor, it came across my screen in my head, like pays for a load of laundry. And I'm like, that can't be right. That can't be right and here we are. It's right. Here we are
Sara [00:51:11] That's my three my three things, right? And I think it's, I think it's fine. I mean, come back in 10 or 15 years to see if you know, yeah, this has turned out but
Caitlin [00:51:21] Well, there's going to be a line on your block for people trying to get their 25 bucks.
Sara [00:51:27] Of people knocking on the door, like, hey, you got a load in there.
Caitlin [00:51:33] All the teens in the neighborhood will be like, Sara, are you going to wear those sweatpants again, or can I put those in the load? OK, well, we got division of labor and a financial partnership, and then also the kiddos in there too. I feel like we have done this. Thank you for sharing so bravely both of your family situations that we can learn so much from. I hope you all don't think I'm completely nuts so no but nuts in the best way possible and like you know the method to the madness and really like forcing us to rethink these things that just like We don't see models of people doing it a different way. So here you are. Oh, thank you Okay, my dear until the next time see you later. Bye
Sara [00:52:28] Do you have a question about investing or finance? Send it to us in an email or voice memo on our website.
Caitlin [00:52:34] WomenOnTheVerge.com. Hey, we want our listeners to know that economic abuse
Caitlin [00:52:39] can be subtle, but it's a serious form of control. Watch out for partners who limit your access to money, sabotage your job, or rack up debt in your name. If this sounds familiar, you're not alone and there's help available. Please learn more at thehotline.org or call 800-799.
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Caitlin [00:53:07] I know, the first thing you notice is that I'm covered in gold
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