Episode 10: Rachael Burns
Welcome! I had the pleasure of sitting down with financial expert and advocate for women’s financial independence, Rachel Burns. Having witnessed friends navigate life’s curveballs, like divorce or death, with financial dependence, it struck me just how critical financial security is. Rachel shares valuable insights on the importance of planning ahead, especially when dependents are involved, and the challenges one might face in the process.
Our conversation led us through the complexities of estate planning and the critical need to have it especially when you have dependents. We’ve shared a roadmap for those on this journey, with advice on where to find crucial financial information, even when you don’t have direct access to accounts. We’ve shed light on the intricacies of finding financial documents and getting help with the process, underlining the importance of emergency funds for unforeseen events.
We also broached the sensitive topic of financial expectations in relationships, particularly between parents and children. It’s not uncommon for people to anticipate their parents covering significant costs, like weddings. These scenarios often trigger challenging conversations. Moreover, we’ve stressed the significance of getting assistance from estate planning attorneys and being cautious with financial advisors. Wrapping up our enlightening discussion, Rachel shared her top three life tips for women over 40 and highlighted the essence of platforms like True Worth Financial in offering valuable advice on financial security. Tune in for the full scoop!
About Rachael CFP®, CDFA®
Rachael is the founder of True Worth Financial Planning, a fee-only Registered Investment Advisor focused on helping newly single women
achieve financial independence after divorce or the death of a spouse. Through her own experiences with trauma and money, she felt a
calling to support and empower other women going through life’s most challenging transitions. Rachael is a recognized expert in personal
finance for women, and her commentary has been featured in publications including CNN Business, Real Simple, and Policygenius. When she’s not perfecting financial plans, you can find her exploring local wine country, testing Pinterest recipes, or chasing after her twin toddler boys.
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LinkedIn: https://www.linkedin.com/in/rachaelvburns/
TRANSCRIPT
Rachael Burns: 0:00
Because you can take someone who is so stressed out in their life situation and the financial stuff the financial stuff just compounds the stress and so when I can help simplify that a little bit, he didn’t understand what I do. I’m noticing that a lot of my friends are getting divorced and I’m like what happened? Is it something? Something in the water, like what’s going on? But I think it’s just approaching age 40 and get to understand yourself better than ever before, like a certain level of confidence and just like really knowing who you are and not wanting to compromise on things that you shouldn’t be compromising on.
Caroline Balinska: 0:41
Welcome to the Life On Purpose Over 40 podcast, where empowerment, elegance and health take center stage. I’ll be your guide on this thrilling journey to outshine your past self. This is a podcast all about transformation, so plunging head first into exactly what health, wellness, style, relationships and career look like as a woman over 40. You’ll be hearing from all the most sought after global trailblazers and experts. This isn’t just about learning. It’s about embracing your inner, fierce, fabulous self. Let’s get started. Welcome back to the podcast. I’m really excited today we have Rachel Burns with us and this is something really close to my heart. I was just explaining to Rachel before we started. I’ve been in this situation recently with two dear, dear friends who have gone through this situation themselves, and I really wanted to get Rachel on, because this is not something that happens to women expectantly. We go through this in a very unexpected way. So Rachel’s going to give us some great information and if you’re in a situation where you don’t think that your financial security is a problem, if you’re married, if you’re in a relationship, keep listening, keep watching, because I guarantee you’re going to get a lot of great advice out of Rachel today. So, rachel, thank you for joining us, thanks for being here. Thank you so much for having me Wonderful. So I was just saying I was telling you before we actually started that I had two friends of mine, one this year and one last year, my dear friend that I’ve known for about 15 years. Her husband passed away and he was ill for about three years. They were very financially successful and they’re in a situation where they had time to plan everything because they knew he was ill. She’s got two children of her own and three of his children four of his children actually and so between all those kids and everything that she’s going through, even though they had three years to plan, knowing that he had passed away, her financial security was dependent on their relationship and it’s left her in a situation where, while she’s not living under a bridge, I don’t think it’s made it easy, even though they had the planning. I think maybe it’s easier, but it’s not easy and I don’t think it will ever be easy in that situation. And a friend of mine as well she went through a divorce, but quite an extreme one, where the partner has no right to the children anymore, he has no financial dependence with his children and she’s now 100% the caretaker, and I can guarantee anyone that’s watching this or listening to this those two friends of mine when I knew them in the start of their relationships, they would never have guessed those two women would be in the situation they are now. You would never no one would guess themselves in this situation, and that’s why I really wanted to get you on, because I think giving people this advice and the thought process to think this through is really important, because the last thing you want to do is be put in a situation when you’ve got kids. You’re struggling already. You’ve got mental stress to deal with and then having financial stress as well. So, yeah, I would love you to share everything you know and I’d like to start off by asking you what is your? Take us back to the beginning of your story, and how did you start on this path of helping women with financial security? Through divorce and through death?
Rachael Burns: 4:11
Sure, so I have been a financial advisor. I started in that role right after I graduated college, so it’s been over 15 years, I guess. And when I went into the industry I wasn’t specializing in women. At that time I didn’t know that that was even an option. I probably would have loved to have gone in that direction right away, but I didn’t know. I didn’t know what. I didn’t know when I was just like, okay, I’m just going to do whatever they tell me to do. And so I was more of a general financial advisor and that was fine and I did that for many years and was really happy. But what I noticed was whenever I had the opportunity to work with women who were managing their finances for the first time because either they went through a divorce or their spouse passed away or maybe another family member passed away and they come into some money it was always my favorite type of client to work with because they really needed the help. They were really appreciative of the help, they were open to any education that I could provide and it was just a really gratifying experience. Because you can take someone who is so stressed out in their life situation and the financial stuff the financial stuff just compounds the stress, and so when I can help simplify that a little bit and kind of take some of that financial stress off their plate, they feel like they have more emotional bandwidth to like deal with the rest of their life, and that’s really that makes me feel really good. That makes me feel like I have a specific skill that can help people feel better in certain situations and I’m like, okay, that’s what I love to do. And so I still didn’t know that I could specialize in that for quite some time. So I would get lucky and have not that I want clients to be divorced or widowed, but I would come across those clients, but it wasn’t until I wanted to give more of an impact. You could impact them Exactly, exactly. And so it wasn’t until I went independent and started my own financial planning firm that I decided you know what, that’s my favorite type of client to work with, that’s what I am best suited to do and that’s all I’m going to do. And so I really limit myself to women who are widowed or divorced or going through some sort of life transition. I don’t really work with men anymore. I don’t work with other types of situations too much. So it’s been. It’s been more gratifying that I even thought it could be now that I’m only doing that. It’s just. I feel like I created my dream job and it’s funny because when I tell people what I do, they think it sounds depressing. But I’m like no, it’s not, because there’s a lot of people that need help, that don’t know where to go for help and I can help them and that’s good for everyone. Yeah.
Caroline Balinska: 7:06
And knowing that just some of the accountants I’ve experienced over the years in business and as a woman just going into an accountant talking about my tax as what I used to have my hairdressing salon as an example and I remember one particular accountant back this is 20 years ago, more than 20 years ago, and just the heat. So he didn’t understand what I did for a job even and I was like I’m a hairdresser. How hard is that to understand and I can just imagine women stressed out in that situation when they’ve got all of this other stuff. Going on sitting down with someone who doesn’t understand them would be excruciating to say the latest. I think, like you said, it compounds everything. It just yeah. You would make a big difference to their lives just knowing that they’ve got you looking after them, protecting them.
Rachael Burns: 7:58
Yeah, and not to. I mean the regular financial advisors. It’s not that they’re bad, it’s just that they’re not specializing in that type of situation. So they often don’t know what to say or what to do. They don’t know how to deal with people when they’re crying. They don’t know how to deal with the emotional component of the finances and that’s all really, really important and has to be addressed. And the client has to feel comfortable or else they’re not gonna share the information that you need to advise them and they might not listen to anything you tell them if they’re so stressed out. So I feel like you can’t do a good job for them if you don’t get on their level, speak to them in a way that makes them feel understood and heard and they don’t feel like they’re being talked down to. They don’t feel like. You know, some advisors will focus on things that they think are important, but that might not be what the client thinks is important and it doesn’t matter. What I think is important, it’s what’s important to the client and if you don’t make the effort to find that out, then there could be a big disconnect there.
Caroline Balinska: 9:07
Yeah, I understand, and I think you mentioned it as well before we got on the call. Is that another thing that’s really powerful? This podcast is really aimed at women over the age of 40. And you were saying that it’s really noticeable that when women get into their sort of early 40s, before they’re 40, around that sort of 40 year old mark, they’re saying to have more divorces than normal because they’ve done the marriage for many years and, for whatever reason, the marriage has ended.
Rachael Burns: 9:35
I’m noticing that a lot in my personal life and in my professional life. I’m around that age and all of a sudden a lot of my friends are getting divorced and I’m like what happened? Is it something in the water? Like what’s going on? But I think it’s just people that got married in their mid 20s or their 30s, like they’ve been together for a decade or more and maybe it’s not working out and you just see this kind of wave of divorces and it’s a normal thing. It’s interesting when you see a bunch of them at one time, but maybe I’m looking out for them more because of the nature of my job.
Caroline Balinska: 10:13
No, no, no, I do believe it as well. I was a hairdresser for nearly 20 years. I did a lot of weddings as well, and, yeah, it’s pretty much that once they get to their 40s, it is happening, and there’s a few things that either the children have just left home, so they feel like they’re confident too. We can now end this, and not put it to life.
Rachael Burns: 10:31
That has a lot to do with it, I think.
Caroline Balinska: 10:33
Or they’re just. They’ve been in sort of that transition period around 40 years, that 35, I think from 35 onwards you turn into a slightly different person. There’s a lot of different things Different in your 20s than you are in your late 30s. So I think that’s also part of it. They’ve either grown apart or they’ve both become really different people, or they want different things.
Rachael Burns: 10:55
Yeah, it’s funny. I was talking to a friend yesterday about approaching age 40 and how you get to understand yourself better than ever before. There’s like a certain level of confidence and just like really knowing who you are and not wanting to compromise on things that you shouldn’t be compromising on, and I think that’s a really good thing. But what I think can happen is you might grow into this person that you’re like hey, this is what I am, this is who I am, I’m not gonna put up with certain things, and maybe the relationship is like I can’t do this anymore, cause it’s just you grow, and sometimes you grow in different directions. But I do think that that 40 mark is an age where there’s a lot of reflection and there’s kind of a lot of self-discovery, which is a good thing, but it can also lead to changes in relationships as well.
Caroline Balinska: 11:53
Yeah, it’s so true. I was just turned 44 the other day and I really have realized how different I am as I got into my 40s. And the funny part is is that when I was in my 30s and 20s, I was told that my people my mom would say it and other people I’d be like no, it’s not true. And now, like once, you actually start going through that process, yeah, my mom said the exact same thing.
Rachael Burns: 12:16
My mom said you won’t know yourself at all until you’re 30, but like once you’re 40, you get really comfortable with yourself. And she was spot on, as usual, yeah.
Caroline Balinska: 12:28
We love our moms, yeah, and so, because this is the case, I wanna ask you what are some of the biggest mistakes you’re seeing that people make financially when it comes to first becoming single?
Rachael Burns: 12:43
in these situations, when it’s reasonable to also dad, I think when you, especially if you’ve experienced a sudden transition, some people don’t see a divorce coming, or sometimes it happens really quickly. Or sometimes someone passes away very unexpectedly, and even if there’s an illness that’s like your friend, for example that’s still an unexpected like oh my gosh, this changes everything. And I think that when that happens and people are in a state of shock and they’re traumatized and they kind of don’t know what they need to do, and sometimes they do the wrong things and sometimes they just don’t do the right things. But it’s hard to kind of prioritize at that time, like, okay, what do we do now? And when someone, when they’re newly single, a lot of times they panic because they don’t understand their finances, because maybe they weren’t managing it themselves before, and so they’re like, oh my gosh, I’m responsible for this now, I don’t understand and I’m really scared, I’m not capable of learning, like I’m never gonna figure this out, and so they will kind of sweep it under the rug or not address it because they’re just terrified. And that’s a normal response. And what I tell people is no one is born bad with money. You can always learn what you need to learn to do this yourself, and you don’t have to be an expert in every single thing. You don’t have to pick stocks, you don’t have to understand Bitcoin, you don’t need to like go overboard, but you are fully capable of learning, bit by bit, the fundamentals so that you’re gonna feel confident about it going forward. I really believe that everyone is capable of that. So that’s a mistake that I see is just thinking like, oh, I can’t do this, like I give up, I can’t do it Cause that’s not the case. And then sometimes people will just make big moves right away when things haven’t settled down, and sometimes those moves can be a big mistake in the long run, especially if you get divorced or someone passes away and you’re suddenly in charge of this pot of money that you’ve never been in charge of. Sometimes and this doesn’t happen as often, but sometimes people will just make a big decision like, oh, I’m gonna sell my house and I’m gonna move to Italy, or I’m gonna give my sister $100,000 to start her business, or I’m gonna do something big because I’m kind of not in my right mind at this moment and I’ve seen people do some really damaging things and I don’t. It’s not like I’m like, oh, don’t do anything because you’re not in your right mind, like, but you have to understand that when you’re under stress, your brain is not working at max capacity. Like, think about how we are when we’re tired, like trying to make a decision Like, what flavor ice cream am I gonna get from the store, like, things are hard. It’s hard to like work through decisions when your brain isn’t at 100%. And so it’s like, give yourself a little bit of a break. Don’t make yourself, you know, make these huge decisions. Like, just give yourself a break, kind of calm down and deal with things. You know, deal with the most urgent things first, but then, like, try to put off the other stuff until later when you have a little bit more bandwidth. You don’t have to do everything at once. There’s a lot of things that you can put off, which I think it’s funny to say that but like, some things are really not top priority. It’s just like figuring out what the priorities are, like okay, what things do I need to do now and what can I just wait on?
Caroline Balinska: 16:50
So what would be top priorities? Top?
Rachael Burns: 16:53
priorities is making sure that your day-to-day bills are paid and your day-to-day needs are met, like really basic stuff, like is your utility bill being paid? Do you have cash to buy groceries and gas? Like the basics. And sometimes people don’t have the basics covered at that time, like I’ve met widows where all of their bills were set up on auto pay for their spouse’s account. That was only in the spouse’s name, which gets frozen when someone passes away. And so I had like a client where her utility bills, her cell phone bill, her cable, like everything was not being paid and she couldn’t get the money out of her husband’s account because it was only in his name. And I was like I don’t like that. Like you just got to make sure, okay, let’s keep the lights on, let’s keep the AC or the heater going, let’s make sure there’s food and gas and all those things, and then, once that’s under control, let’s move on to the next thing. So it’s just you really start small.
Caroline Balinska: 18:06
Yeah, I went through all of these when I was pregnant, actually with my child that I worked that out with my partner Like we need to have some sort of will because if something happens and I can’t pay the bills, like what am I going to do? Like I’m not going to be working. Suddenly, like you’re dead and I’m going to be like, yeah, I’m going to drop now.
Rachael Burns: 18:23
So yeah, it’s funny when I was pregnant I went and got my will and trusted everything, so I was like in there with my big belly. It’s a good time to do. It’s good for any adult to have some sort of estate planning in place, but the second you’ve got kids in the picture, or if there’s another person that’s dependent on you maybe a spouse or family member like you, need to have your affairs in order in that way.
Caroline Balinska: 18:50
Yeah, that was our situation before that. I was independent. Yeah, I did what I wanted to do and at that stage I was like, hang on, I think there’s more to it than that. There’s a child now. So, yeah, what would be a good path to take in this position? So let’s say, for instance, someone’s in that situation, someone’s just died, their partners just died what would be the process that they should think about at that stage, if they’re going to talk in a minute about how to set themselves up for something to make sure this doesn’t happen, but let’s just go through the scenario. Let’s say they haven’t got anything in place and they need to know what to do. What would you recommend is the first couple of steps they take?
Rachael Burns: 19:32
Yeah. So I think once the super, super urgent stuff, once you’re like, okay, I’m not going to get the lights shut off after that, I think that’s the time to reassess your situation and that’s a good time to start gathering your financial details and this is not a fun homework assignment for most people, but this is something that’s so important. You need to know, if you didn’t already. You need to know where your accounts are, what debts you have, what your income is going to look like, if that’s going to change now that your person isn’t around. You need to know how your expenses are going to change, although that’s a little bit harder to figure out, but at a minimum, like, figure out where is your money held. If you have investments, what are you invested in? Do you have estate planning documents? Do you have insurance? Just gather all the details of the financial stuff that you already have. Gather that so that you know where everything is, you know what it is and you can get an idea of what your finances are going to look like going forward. And once you know what, know where you are now, then you can start planning for the future. But that’s really the first step is you need to know, you need to know all the specifics.
Caroline Balinska: 20:50
And so say, someone’s in a situation where they don’t have access to accounts like that, what would they do?
Rachael Burns: 20:58
So you can always call someone like me, because I love finding stuff and I have some tips like I always share the. I have certain places that I look for things when someone either has a spouse that’s hiding things from them, or if someone passed away and they just simply don’t know where things are. And what I always say is start by looking at your tax returns, because we all have them and even if you weren’t involved in the finances, you have access to your tax returns that you filed jointly. So when you look at your tax returns, you can find all sorts of stuff in there. You can find income from places you didn’t know you had income. So, for example, if your spouse was getting a monthly distribution from some account, you’re going to see it, probably in there. Or you’re going to see if they have an account that’s generating interest. You can see that in there. You can see all sorts of stuff. It’s a little tedious to look at because if you look at tax returns, it’s just like it’s a little overwhelming. But you can always have someone like me look at it, because that’s all I look at. If you’ve applied for a mortgage in the last few years, that’s a great place to look if you can access your loan documents, because, if you think about it, when you borrow money, you have to disclose your financials. So you have to disclose all your income, all your assets. It’s like a perfectly organized layout of your finances. If you borrowed money recently, not everyone has that, not everyone has taken out a loan or whatever, but if you have, that’s a great place to look. It used to be that we used to have paper copies of everything and so you could just rummage around in drawers or you could check the mail, but that doesn’t always. That’s not really the case anymore. There’s a lot of online stuff and sometimes sometimes you’re just like you know, I feel like they had an account at this bank and sometimes you just have to start calling around and you’re not always going to get the information that you’re asking for right away, because sometimes you have to prove who you are and why you’re asking. But it’s a process. If you really don’t know where things are, it is going to be a little bit of a treasure hunt, but you have to do it and you don’t have to do it alone. You can get help with that kind of stuff.
Caroline Balinska: 23:21
Hmm, very interesting. Yeah, that was part of my friend who went through her serious, really traumatic divorce that she she’s actually an accountant herself, so for her she actually did a lot of that, while she was doing it within a forensic forensic yeah yeah, but yeah, she did a lot of it herself as well and she was telling me some of the stuff that she was finding because she they had to by law, the criminal court, they had to hand over the documents of all these bank for the last like 10 years or something that they’ve been together. Yeah yeah, she went through everything that way. So, and that’s another thing I think that I can actually say it depends what country you’re in, I guess. But if it’s a criminal investigation you have access to more than if it’s a normal divorce. So if it’s like a divorce where it’s serious, like if it’s got some sort of abuse that can go to criminal court, then you do get more access than if it’s just a normal way getting divorced and we’re just separating.
Rachael Burns: 24:22
So in the US there doesn’t have to be the criminal element. So if you are getting divorced, our divorce laws are a little I don’t know, I won’t even get into that, but there’s the way that they do it in the US is not necessarily the best way, but what they do is if you, if you are getting divorced and you’re like look, I know my spouse has accounts at this bank, but I don’t have access, if you have attorneys, your attorney can subpoena the documents and so the your ex can be forced to provide those documents. So, and that there doesn’t have to be any criminal intent there, that can just be like part of a normal divorce, and that’s something I see quite often. Like I see a lot of spouses not being compliant with providing information. Yeah, and it’s like you’re going to have to give it up anyway, like you’re. You’re, you can either give it willingly or you can have an attorney get it from you and it’s going to cost a lot more money, but that’s a that’s a common thing, unfortunately, here.
Caroline Balinska: 25:32
And I think that’s another thing on that is that if your partner is saying, if your husband is saying let’s just not go through court, don’t get yourself a lawyer, let’s just try to work this out ourselves. If you do think that there’s something, then yeah, like you said, an attorney can help you get those documents.
Rachael Burns: 25:49
Yeah, and I I hear that a lot from from people who say, oh my my ex is it doesn’t want to go to court, they just want me to sign off on this thing. And I’m like I’m not saying everyone needs attorneys, I’m not saying everyone needs to go to court, but you’re, when you’re getting a divorce, your ex is not on your team anymore. Even if they’re a very nice person and even if they mean well, your best interests are not aligned anymore and it’s their responsibility to act in their own best interest and it’s your responsibility to act in your own best interest and those two things. You’re not on the same team and I really caution people like, even if you’re, this is an amicable split. Make sure that you are still having someone look over it or really doing your due diligence to make sure that you understand what you’re agreeing to, because a lot of times someone will just trust their spouse and then they’ll sign off on something and afterwards they’re like, oh, I got totally screwed out of all this money.
Caroline Balinska: 26:55
Yeah, even pensions, or there’s all sorts of things that can happen. Yeah, let’s give the scenario that we’ve got women listening and they might be in a situation where they’re starting to feel like there’s divorce in the air, or they’re starting to think hang on a second. I’m at that point in my life where I should think this through more seriously. At this stage, what can they do? They’re already in the relationship and they need to know what to do next. What should they be taking care of first?
Rachael Burns: 27:27
So if they think that something might be on the horizon, I think gathering any details and documents that they can about their finances. Doing that before there’s a divorce happening is going to make it so much easier to get access to those things. Because if your spouse knows you want a divorce, they’re probably not going to want to give you any documents. They’re not going to want to tell you where anything is. Not that I’m saying don’t tell them so that you can be sneaky and get stuff. It’s just understand that the second that divorce is actually happening, it’s just going to get harder for you to get access to things. And so if you’re still living together, for example, and if you still have access to files, it’s good to just make copies of documents that you’re legally entitled to see anyway. Like I’m not ever saying I’m not saying break into things or hack into accounts, don’t ever do anything that you’re not legally entitled to see but gather what you can while it’s easy because it might not always be so easy, and that’s something that I think everyone can do but even if you’re in a relationship and you don’t think you’re headed for divorce, or even if everyone’s healthy and you think, oh, it’s always going to be great. It’s really important to stay somewhat involved in the finances, even if it’s not your thing, even if you don’t have an interest in it or you don’t really understand it. Because if you completely delegate that to someone else, that’ll work fine until you need to take over for yourself for whatever reason, and if you’re completely out of the loop, it’s going to make it so much harder to take on that responsibility later because you’re not going to know where things are, you’re not going to know what your budget looks like, you’re not going to know about your investments. It’s really important, I think. Even if your spouse is like, oh, I’ll take care of this, I think it’s important to say you know what. Something can happen to one of us, something can happen to you, and I wouldn’t even know where the accounts are. I really want to just know the basics at least, and I think that’s important for anyone to do, no matter what their relationship status is.
Caroline Balinska: 29:53
Yeah, that’s good advice. So if someone’s in a situation where, like you said earlier, they might have all the accounts in their spouse’s name, and that’s fine, for now, like you said, there’s no problems, there’s no, but debt can happen at any moment.
Rachael Burns: 30:09
We don’t?
Caroline Balinska: 30:09
Yeah, we have no idea. And let’s say that all the bills are in his name. What should she do? At least have username and passwords to access it, know who to call, be able to be a second person on the account, things like that. Or is there something else?
Rachael Burns: 30:26
So it depends on what specifically you’re trying to do. So if you’re calling like I would call the companies where the bills are set up through and just explain the situation, and if you can pay from a different account, that’s great. If all the money is in the account that’s just in your spouse’s name, then it’s going to be tricky and it really depends on if the account was set up so that it’s payable on death Sometimes. I don’t know how it is in other countries, but here if you have a bank account, you can have it be owned just by you, but as soon as you pass away it automatically goes to the beneficiary. But not all accounts have that feature. So if it has that feature, that’s great. You can get access to the money relatively quickly. But if the person who passed away doesn’t have any estate planning documents set up for that kind of thing, you might have to go to court to prove that you are the heir and then it takes a while to get access to that money. So it can get really tricky. And if you find yourself in that kind of situation, I would reach out to an estate planning attorney because they can get you through that process with the court as quickly as possible, because it can be very, very urgent.
Caroline Balinska: 31:51
And a question about emergency funds. So let’s just talk about a woman’s financial security. So, as a woman, what should we be thinking about when it comes to our own financial security? So then, whether there’s a death, whether it’s a divorce, or whether it’s just us wanting to feel secure for ourselves, what should we be thinking about?
Rachael Burns: 32:14
So, like you said, an emergency fund is, I think, the basic, the first step to take, because you will absolutely have emergencies at some point. I promise everyone will have something happen at some point that they’re not going to expect. It’s going to cost money. Some emergencies are kind of foreseeable. So I might have an emergency that, oh, I need new tires, but I kind of knew that I was going to need new tires at some point. So it’s like not really an emergency and I don’t think that’s a good use for an emergency fund. I think emergency funds are for things that you have no idea when it’s going to happen and it’s not like you know oh, you know, at some point I’m going to need a new roof. It’s like things can happen out of the blue, like you have a medical problem that comes up, or you get injured and you are unable to work, or maybe one of your kids gets injured or something, something that’s truly unforeseeable. You really need to have cash ready to go that you can use right away. You don’t have to put it on credit cards, because if you use your credit cards as an emergency fund, you’re just going to pay more for the emergency. It’s just going to. It’s just going to be more expensive and it’s everyone needs an emergency fund. I know it’s not people don’t want to hear that, but like it’s just stuff happens to literally all of us. I mean all of us have stuff that comes up. So it’s just really important. And as far as how much to save, that really depends on the person. Like, if you have a very, very stable job, maybe you don’t need to have as much of an emergency fund as someone who’s self employed. Or if you’re single and you live on your own, your emergency fund doesn’t need to be as big as someone who has kids. So it’s really it depends on the situation. But everyone should have an emergency fund that they only use for true emergencies. Don’t use it for vacations. Don’t use it for an emergency.
Caroline Balinska: 34:21
You know that. Yeah, like it’s an emergency, I need to go on vacation.
Rachael Burns: 34:26
Yeah, that’s a really foundational step in getting your finances in order is having that safety net there for you.
Caroline Balinska: 34:37
And what about in situations where there’s relationships that sometimes, like you said, demands and control of everything, and a woman’s in a situation where she maybe doesn’t have her own income? She might be the stay-at-home mom, or they pull their finesse together. How does she go about getting an emergency fund together in that case?
Rachael Burns: 34:59
That’s tricky. So if you are not the one that physically is managing it, and if you know you don’t have an emergency fund, you might talk to your partner about that. Not every partner is going to be receptive to those conversations, I guess it depends, but like it’s still really important to do. And if you can’t get your partner on board, you can. I’m not recommending that you hide money, like in a separate account, although you need to have access to cash. I mean, you just do so. You kind of do what you need to do to have that. So yeah, it’s hard for me to give advice because I can’t just say, oh, just get a little account on the side that your spouse doesn’t know about, because that might cause some problems.
Caroline Balinska: 35:50
But everyone needs to stay in that. And then it comes down to if you’re in a situation where the person’s not willing to have that conversation, first of all, or not caring about the security of especially if there’s kids involved, especially if you’re a person that has kids, then there’s another layer of a problem there, I think, than having a private bank account that he doesn’t know about. I think the problem is much bigger than that. That’s not the problem, and I’m sure you hear a bit all the time I’ve heard of it before. The man’s like oh, you’ve got the private bank account, you’re the one that’s got the problem, you’re the one that’s kept the secret. Yeah, why did I have to do that?
Rachael Burns: 36:31
Yeah, there is a different problem going on there anyway Right, and it’s unfortunately very common that people are not on the same page with the financial stuff. Either they don’t talk about it or they don’t have the same goals, or they don’t have the same spending habits or whatever. And if there’s no communication about it, those problems can fester and they can turn into big problems. And those are not even financial problems at that point. Those are just, I think, therapy, couples therapy is probably the best solution for that, because you have to learn how to communicate about that topic, because it’s a really important topic and, especially if you have a family, you really need to find some common ground so that you can manage the finances together. You’ve got to figure out a way to do it, and if you really can’t do it, then that relationship might not last. Money problems cause a lot of divorces. A lot of divorces that I come across are caused, at least in part, by money problems, because it’s such a huge part of our lives.
Caroline Balinska: 37:44
Yeah, and you know what. I did over 200 weddings and I’ve seen some very extravagant things. I remember one girl was saying that her and her partner shared a car and the car was like a $10,000 car, which in Australia is not a lot because of all the taxes, so $10,000 is not as an expensive car and her dress that she bought for her wedding was $15,000. The dress was $15,000. They couldn’t afford a second car. They had to share this car and it’s like an America where you don’t have transport easily. And I was in her house doing her hair and makeup for her wedding and her house was falling apart, like her parents’ house was falling apart. The stool she was sitting on was falling underneath her. It was so broken and her parents would pay for this wedding dress. And I’m just looking around going look at this hat Like not to put anyone down, shame anyone. But how are you investing $15,000 into a dress for one day? And yet everything else around them was falling apart. And I’m sure that they did not talk about finances, right. And I had a lot of couples I remember on the wedding day the bride, I would be talking and I was finding out things I weren’t discussing, things about religion, like one of them was like I remember so many times in Australia we’ve got a lot of Greek Orthodox people and these women Greek Orthodox women were saying that their child will be raised in the Greek Orthodox Church and the partner that they’re marrying was Christian. And in Australia most Christian people are not religious. They’re like non-religious Christians and I’m like, have you guys discussed this? Like just know that, how do you meet in the middle on that one? Yeah so religion, also money. The amount of times that already, by the wedding day, they were arguing about money was unbelievable. Where they were going to live, like the amount of things that we don’t, as humans, don’t talk about before we get married. But the wedding day was all that. You know, that was all it was about. I remember, sitting next to going the amount of weddings that I was like these relationships can’t work like this. This is not sustainable. And, yeah, not being able to discuss finances like you said, I think it’s a therapy thing.
Rachael Burns: 40:05
Yeah, I think so too, and it’s funny with weddings. Part of it there’s a lot of expectations from family or from society or whatever. Like it’s a complicated thing. But I’m the same way when I. The way that I look at it is whatever you think you’re going to spend on a wedding, let’s say $20,000. I’m just making up this number. Are you in a financial position to where you would throw a $20,000 party for a night like a like an anniversary party or a birthday party or something? Would you throw a $20,000 party? Like I’m not. When I think about $20,000 or $30,000 parties, I think about like celebrities, like having a crazy party. You know where they have like an ice sculpture and all this crazy stuff. I’m like, okay, I’m not that kind of person, so why would I throw a $30,000 party? That’s I mean. Obviously, a wedding is a very special occasion, but if I’m not someone who can afford to throw a $30,000 party, why do I think it’s okay? Because it’s a wedding? I see that I like people will. People cannot afford some of their weddings and they, just because it’s a wedding, it’s like all all bets are off.
Caroline Balinska: 41:22
They just I don’t know, I think, it would be different if they had their house paid off, if they had the money put aside for their child’s, like education and they’re in a very different situation and all of those things. I think that would be a different situation, but that’s not really what you see.
Rachael Burns: 41:39
Like that’s not what I see, that’s what I see.
Caroline Balinska: 41:41
That were like my parents better give me this money because they owe me, because I’m their daughter, is sort of like like my parents didn’t pay for things like that. My father never paid for anything, like he didn’t even throw. In Australia, everyone has a 21st birthday. My father didn’t even give me a present, let alone a birthday party, and so I’m used to not getting anything like that. And then you’ve got these girls are like, yeah, hell, yeah, he’s going to pay for my wedding. And it’s like why should that money? Like that’s fine if, if your parents have saved that money and everything else is paid off and they want to give you that money as a gift because they have gone to that effort to save the money and I do know people that have done that yeah, Totally different. And I’ve also seen your parents to pay for a wedding, which I have seen that I’m like, oh my God, like it’s your day, you really want to pay for it. Or I remember a particular person who she was building a house at the same time invited all of his family and he was like I don’t even know these people, why are you inviting them? I haven’t never even met these people and she’s like they have to come to our wedding and he’s like I don’t care about them, I don’t even know them. And then yet she was building a house and she came into me one day, the salon, and she’s like, okay, so I have a choice this tile, I really want this tile for my bathroom, or I get this one and this one’s a quarter of the price, but I really like this tile. But I could only afford this one if I want to have my wedding and I’m like your wedding is one day. Get the tile you want, because you’re going to be looking at those for a long time and, trust me, you’re going to end up divorced before like anything else. And you want the tiles that you want because the wedding day is not going to be like, not going to be worth it. I saw her about six years later down the street one day and they were divorced.
Rachael Burns: 43:20
So yeah, really.
Caroline Balinska: 43:24
Because it was about this wedding day, that was just nothing else mattered to her, and it was getting ridicule bordering on ridiculousness instead of it being about their future. What actually mattered, not just this one. I think that one day, I think, is too much, and if you can afford it and you’ve saved up, specifically I do know you do whatever you want that their lives saved while their parents have. That’s different, but I think putting yourself in a financial situation that puts you in a negative situation for a wedding day doesn’t make your marriage more successful.
Rachael Burns: 44:00
Right, it’s not getting off to a good start Right off the bat.
Caroline Balinska: 44:04
No, so if women are in a situation and they feel completely clueless about finances, what should they do? I don’t know.
Rachael Burns: 44:13
So I encourage people figure out what your best method of learning new stuff is. For me, I like to listen to podcasts. I have little kids so I can’t sit and read a book. I haven’t read a book since they were born, so I have to learn through podcasts. That’s my favorite way. But if you’re someone who likes to read books or if you’re someone who likes to look at social media whatever your preferred method is just learn a little bit whenever you can. I mean make a point to every day, sit down and read about financial stuff for five or 15 minutes or whatever you can spare, and you don’t have to read a ton at a time, but over time that knowledge is going to build on itself and you’re going to be surprised at how much more you know. And I really want to encourage people that learning can be approachable if you approach it in a way that it’s the way that you like to learn and it’s going to be the easiest to keep up consistently. But you don’t have to read a textbook, you don’t have to take a class. You can just find some books online or find there’s so many financial podcasts that are so great. So I think, just figure out what’s best for you and then just do some digging, I mean do some Googling, just get curious and keep at it.
Caroline Balinska: 45:49
Yeah, that’s great advice. I came across the what’s his name. I forgot his name Rheth.
Rachael Burns: 45:56
Oh, the guy with the show on Netflix.
Caroline Balinska: 45:59
Yeah yeah, that’s actually hilarious. So if you’re not into, if you like, finances are not your thing, that’s actually worth watching because he gives some really good point to the special in relationship situations that some of these situations, like he said, like they need therapy, and he ends up being the therapist between them, which becomes hilarious.
Rachael Burns: 46:18
I only watched part of one, but I watched it the other day and there was a couple where there was a lot of unspoken stuff and I was like that poor guy he’s like a finance guy and he’s turning into a marriage therapist.
Caroline Balinska: 46:33
Definitely, definitely.
Rachael Burns: 46:34
But he knew what he was getting himself into.
Caroline Balinska: 46:36
Yeah, exactly, but because he’s actually got a YouTube channel as well, so I’ve watched it quite a bit. I became obsessed at one stage and then, once you start watching something on YouTube, then you only get those videos, and so I’ve watched like probably about 20 of his and yet a lot of the times it’s like, yeah, you’re the therapist here, not the financial guy at all, and that’s really. You see that from the beginning. Yeah, that a lot of the times it is that it’s therapy that’s needed and it’s working on your financial stuff. Because I don’t think anyone wants to feel like they’re not secure. Even whichever partner is the person going, who cares? I’m not going to think about it. I don’t think, fundamentally, living under a bridge is something anyone wants to do. Sleeping in a box that’s not anyone’s goal in life. Just some people don’t realize the importance of making sure you set yourself up correctly.
Rachael Burns: 47:28
Yeah, yeah. Sometimes people don’t understand the consequences of not planning. They think, oh, it’ll be fine, I’ll have social security, or my parents will die and leave me money or something. If you don’t have a plan, you could be very shocked at what can happen.
Caroline Balinska: 47:48
Yeah, and what are some resources for nearly single women if they do need some?
Rachael Burns: 47:54
help. So I think, honestly, this doesn’t sound very helpful. But I think Googling whatever your specific issue or question is a great place to start. But if it’s something not everyone is like, oh, I’m going to take this upon myself to figure out the answers. You can get help and obviously I’m biased because I’m a financial advisor but you can hire a financial professional. You can hire them for an hour just to answer some specific questions, or a couple hours to look at some documents or whatever, or you can have them do a full financial plan. It really like, no matter what your budget is, no matter what your needs are, you can get professional help. Some people don’t realize that they can access that. Some people think that, oh, you have to have millions of dollars or you have to. I’m going to ruin that. So just calling up and saying I just need an hour of someone’s time just to have the basic questions that I need help with, and not all advisors work on an hourly basis, but you can totally Google hourly financial advice in my area and you can get a little nugget of advice that can really change the trajectory for you. It doesn’t have to be a big investment for you, but you really need to make sure you’re doing the right thing and if you need to pay someone a little bit to make sure you do the right thing, you can end up saving so much money in the long run by not making mistakes. So I tell people, don’t be afraid to ask for help and don’t be afraid to pay for help, because it’s probably not nearly as expensive as you think it is.
Caroline Balinska: 49:42
And just to help everyone understand. So you’re a financial advisor and there’s different types of financial advisors, and so if someone was in the situation they’re going through a divorce or thinking they’re going through a divorce or there’s been a death of their partner, what are the different types of financial advisors and what would be more beneficial? You did mention before as well, estate planning. There’s a few different types of specialists.
Rachael Burns: 50:11
So I can only speak to the US because I’m not sure how the titles are elsewhere. But financial advisor is a very general term and there’s not a lot of requirements to call yourself a financial advisor, unfortunately. So there are certain designations that are available that advisors or professionals will get, so that it shows that they are competent in that area and they’ve passed exams and they have a minimum amount of experience. So I’m a certified financial planner, which means I did a really big exam and I have to do many hours of continuing education every year. So that’s a way that you can make sure that they are at least minimally competent. I’m also a certified divorce financial analyst, which means I’ve done a lot of reading. I’m an expert in finances specific to divorce, which is a very, very different field than just general financial planning. So you can find people who specialize in whatever issue you’re having or whatever need you have. But just be cautious with the titles, because financial advisor doesn’t really mean anything. Like, you can have an insurance salesman that calls themselves a financial advisor, but they’re an insurance salesman, so you just have to be cautious. Okay, oh, and to answer the part about the, sorry to interrupt, but estate planning attorneys are a bit a really important professional and attorneys are attorneys. They pass the bar exam, they are licensed attorneys. Financial advisors can’t give legal advice. Tax people can’t give legal advice, vice versa so. But estate planning attorneys are really important for, like, your wills and trusts and things like that.
Caroline Balinska: 52:15
And they’re useful after the fact. So if there’s been a death and that hasn’t been arranged, would you go and see an estate?
Rachael Burns: 52:24
Yeah, Estate planning attorney. So yeah, if you are, if someone passed away and didn’t have their affairs in order and you have a mess on your hands and estate planning attorney can help you untangle that mess and get you through that process. They’re very helpful with that sort of thing.
Caroline Balinska: 52:43
Okay, so I’m going to put in the show notes the couple of levels of financial advisors that you the safe ones, because there is so many stories about people, especially if you are a woman who’s, like you said in the beginning, has come into a lot of money through maybe a death or something, and suddenly you’ve got this large amount of money on your hands that you’re not used to, and if you take it to a financial advisor that’s actually not a real financial advisor, you could end up losing that very money, that money very, very quickly through there, using it to invest it for you, and then it’s gone. And once someone’s invested your money and you’ve given them permission I know it’s like this in Australia if you give someone permission and say you look after my money and you advise that you you invest it for me on my behalf, if they lose it, you have no financial.
Rachael Burns: 53:33
Yeah, you’re taking on a lot of risk, so you have to choose. Even if they have all the qualifications, you still have to be careful because there’s risk with any type of investing. Yes, you want to make sure that. That’s why it’s good to get referrals from people that you know and trust. Like if you have a divorce attorney, you can ask your divorce attorney for a referral for a financial person or vice versa, Like that. I like referrals because, like, when I want to get my hair done or my house painted or something, I ask my friends who, who do you use? And I would rather go to someone that I know did a good job rather than just looking someone up on Google. I think that’s just a good way to find professionals.
Caroline Balinska: 54:19
Yeah, that’s good advice. And, rachel, I do have a question that I ask all of my guests and I want to ask you as well, which I think there’s no right or wrong answer, so anything you say is helpful to everyone out there. What are three life tips that you would give to women over 40? And there could be anything, so any three life tips?
Rachael Burns: 54:42
I think, never stop learning, whatever the subject doesn’t have to be about finance, but I think there’s so much interesting stuff to learn out there in the world and we all have different interests. But never, never stop, you’ll like. I just think it’s so easy to be continually growing just by being open to receiving new information every day. I think that I’ve grown a lot just from making a point to like learn, just be always learning. And another tip is have a plan for the worst case scenario. And I know I’m such a buzzkill, but unexpected things happen. I mean, I’ve had major unexpected things happen that I’ve had to adapt to, and I’m not special. This stuff happens to everyone and you can avoid a catastrophe by just having some basic what if? Scenarios. You know, what if I lose my job? What if I pass away? What if my partner passes away? Like, you don’t have to get super morbid, but just have just make sure that you’re not going to be in a really bad situation if something unexpected happens. And the last one, I think don’t stress about having it all figured out, because it works itself out. And it’s crazy how one day you look back and you’re like, oh, I kind of know a lot now about you know, I’ve learned a lot. I just there’s a lot of wisdom that comes with age and you don’t need to worry about having everything figured out right. The second because it’s just going to come and it’s not going to be. It’s going to come naturally. I think to a certain extent.
Caroline Balinska: 56:35
Yeah fantastic. Really like. I love this question because everyone gives me such different responses, so that’s fantastic. But, rachel, you have been amazing and I think you are. I really love about you is how open and genuine you are, because I think it’s a time of women’s lives if they do go through something that it’s really traumatic on so many different levels. And, yeah, I think you’re amazing. Do you work only in certain states of the US or are you allowed to work across the whole of the US? How do you work?
Rachael Burns: 57:04
I work all over the US. Most of my clients are local, so I live in California and I just meet more people where I live, but I certainly work with clients all over the US, so I don’t work with people outside the US, though.
Caroline Balinska: 57:17
No, that’s my only limitation. That makes sense, Rachel. How can everyone get in touch with you if they need any advice from you?
Rachael Burns: 57:25
So my website is a great place to start. It’s trueworthfpcom and you can find information about my services, and you can also book a free strategy session. It’s a 30 minute zoom session where people invite them to tell me about their situation, and I’m happy to share some sort of tips or, even if it’s not a good fit to work together, I’m happy to give you my thoughts, and so I think there’s always something to gain from just having a quick chat, but that’s a great place to start.
Caroline Balinska: 58:03
Fantastic and you’re very knowledgeable, so people would be crazy not to take you off on that. I will put your information in the show notes so people can get in touch with you if they want to get in touch with you and Rachel. You’ve been amazing and you’ve opened my eyes up to so many things as well, and I’m sure there’s a lot of people out there that you have probably changed their lives, so that’s fantastic. Thank you for your time and thank you for all your advice.
Rachael Burns: 58:26
Thank you so much for having me on. This was great.
Caroline Balinska: 58:28
No problems, thank you, and thank you everyone for watching. Bye, bye.